I thought it was the fact that Square Enix and Tri-Ace are partners not Microsoft and Sqaure.

If FF XIII is announced for the x360, yes it is the end for any hope for the ps3.

Do you really believe that? I think it would more likely equal a new beginning for MS. I have to applaud them because they seem hell bent on making the Xbox brand work.

For MS this is about protecting the Windows platform.  They want to keep Sony from establishing a successful competitor to windows based around the TV.  If this is like their other conflicts they will try as hard as possible to make Windows an advantage, my guess is that someone there sees some advantage no matter how vague in trying to tie the two, XBox and PC, together.

Why should share holder be pissed..... they have a company which increased its net income by 2,5% if I recall... where sony is loosing 1,1%.... they are sinking 5 billions and so what??? it's just a third of their net income.... and it's a long term investment.... and no they won't shift their user base to PC again... they stated clearly (and before sony) that they have a long term objective of taking over your living room.... no what you might see though is the XB becoming a PC in your living room.... but 5bilion investment you don't cry after 3 years.... it's a gigantic company such investment are on a long term basis.... and the share holders know that.... you buy MS stock and you keep them 20 years not 2 weeks (i'm simplifying for the picture)

now for the japanese market it's a problem of marketing strategy and advertising... with the right idea the right strat, the right media.... trust me you could sell freezers to Inuits living in igloos..... after all Perrier pull it of to sell water in bottles to people.... aquafina (pepsi) is selling you purified tap water... (basically what you can do with a 20 bucks filter on your tap)

Where did this sinking of $5B came from? It's $6.7 B already and counting.
And I sure hope Square Enix is not stupid enough to partner with MS.
MS partners are usually destroyed.

Fortunately they aren't partners. The situation for Infinite Undiscovery (or whatever the name) is that MS PAYS for the game, SE publish and Tri-Ace develops.
So, it's business as usual for MS in Japan: moneyhats! And I understand that gamers don't like that.
That makes one more console to buy, that no one wants, and that steals some games by using an unsustainable model (moneyhats).
It seems like you can't buy your way to marketshare, at least in Japan, and unfortunately, that's the usual MS business model. It seems like it doesn't work in most cases, like the Zune and countless other failed products showed.

I understand developers' fears too. You just can't associate yourself with such a failure in Japan, as the stigma will stick to you forever after that. Mistwalker already destroyed their brand new company's reputation. I can never understand why they did that, and I doubt making a DS game will save them.

Yea MS partners are usually always destroyed.... im not even gonna comment.

At this point many are believing that SE is stupid to only side with sony, unless sales pick up. I cant believe SE hasnt built a relationship with microsoft till now.

How did Mistwalker destroy its reputation? Many xbox fans were overjoyed by the sound of Mistwalker and MS working together.  Destroyed? Mistwalker is made up of 10 people, thats it. How are they in any sort of trouble of being destroyed? Seriously.

Having created blue dragon which sold over 200k on a 400k system in japan is rather quite good, its sold another 160k in the US in two weeks and we have yet to see Europe release (wont be very high but will still help). This game will easily sell over 500k. Artoon made BD, not Mistwalker all they did was supervise, i dont understand how anything they would be destroyed.

Currently LO is on Fams top list for games at 8 with TGS coming up with brand new footage. We barely know anything about the game, yet it is quite hyped. 

Again how could they be destroyed, siding with MS has nothing to do with being destroyed so take that out of your mind.