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Forums - Microsoft - XBOX 360 profitability - an analysis

MaxwellGT2000 on 12 May 2009
JGarret said:
MaxwellGT2000 said:
Bitmap Frogs said:
lhill81 said:
if microsoft is truly in the plus, the only reason is because they charge for xbox live, take that away it would be a different story, sony dosent have that income, and 360 been out longer, they also make money on a lot of add ons that should have been included in the unit like wifi another 100.00 bucks, recharge units that run 20 .00 bucks per controller, all stuff sony gives out of box, everybody bitches about the price of the ps3 its worth every penny, how much is just a blu ray player, 2-3 hundred, then to have a superb game console, w/ blu ray, 80 gig hd, a dvd player that up samples dvd, they look good, wifi ready, free online play, hdmi, self charging controllers, internet browser, and it goes on for 399.00 is a great price, buy a 360 with all these features and a blu ray player and you will spend around 800 .00 bucks plus

 

Sony does have however income from two profitable platforms, the psp and the ps2. Amazingly enough, that's not enough to cover the losses generated by the ps3..

 

The PS3 destroyed all the profits they made with the PS2 and now getting into some of those PS1 profits... it could end up sending SCE back to square one.

Why is it so difficult, after so many examples in a lot of industries and a lot of history lessons, for companies not to fall into the trap that is overestimating the power of a brand, no matter how successful it is?..This should be basic requirement for a successful business in the medium and long terms.

 

 

The main reasons why the brand has done so well in the past is because it was priced right with cheap technology.  I've heard stories it was a bitch to program on but even then with the weaker hardware it kept development costs down.  Now you have the PS3, priced outside of most peoples gaming budget, strong expensive hardware, expensive to develop on, and hard to program your games.  They took away everything that made their brand such a success, I love my PS3 and I enjoy Sony's games but they make some bad mistakes :\



MaxwellGT2000 - "Does the amount of times you beat it count towards how hardcore you are?"

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thx1139 on 12 May 2009

What is amazing is that in the EDD division all the costs are associated with the 360 and none of them to projects like the following:

http://www.engadget.com/2009/05/12/microsoft-june-2009-will-be-an-important-month-for-zune-lovers/



Its libraries that sell systems not a single game.

heruamon on 12 May 2009
thx1139 said:
What is amazing is that in the EDD division all the costs are associated with the 360 and none of them to projects like the following:

http://www.engadget.com/2009/05/12/microsoft-june-2009-will-be-an-important-month-for-zune-lovers/

They are?  BTW...the latest update states that this is a hoax.



"...You can't kill ideas with a sword, and you can't sink belief structures with a broadside. You defeat them by making them change..."

- From By Schism Rent Asunder

thx1139 on 12 May 2009
heruamon said:
thx1139 said:
What is amazing is that in the EDD division all the costs are associated with the 360 and none of them to projects like the following:

http://www.engadget.com/2009/05/12/microsoft-june-2009-will-be-an-important-month-for-zune-lovers/

They are?  BTW...the latest update states that this is a hoax.

 

 No they arent. Doesnt matter if MS is ready to make the announcement or not. The truth of the matter is MS is pouring money into Windows Mobile and Zune to compete with the iPhone. MS is not going to just let Apple have that market.  MS is playing catchup and that means they are spending cash on those areas, while with current products they are losing marketshare.  So less revenue and much more expense.



Its libraries that sell systems not a single game.

heruamon on 13 May 2009
thx1139 said:
heruamon said:
thx1139 said:
What is amazing is that in the EDD division all the costs are associated with the 360 and none of them to projects like the following:

http://www.engadget.com/2009/05/12/microsoft-june-2009-will-be-an-important-month-for-zune-lovers/

They are?  BTW...the latest update states that this is a hoax.

 

 No they arent. Doesnt matter if MS is ready to make the announcement or not. The truth of the matter is MS is pouring money into Windows Mobile and Zune to compete with the iPhone. MS is not going to just let Apple have that market.  MS is playing catchup and that means they are spending cash on those areas, while with current products they are losing marketshare.  So less revenue and much more expense.

I'm not sure I understand what you meant by "in the EDD division all the costs are associated with the 360 and none of them to projects like the following"...from a reading of the 10-Q's and 10-K over the last year, M$ has poured a signifigant amount of resources into windows mobile.  I'm with you on this working to counter the iphone, and retain windows mobile #2 slot, but I'm not certian it's going to be in the form of a Zune HD.  BTW, I'm currently sitting on the fence on pulling the trigger to get my Ipod Touch, but I'm waiting for the lastest gen to launch...if M$ launchss a Zune HD with 360 integration...I would be highly tempted to get that instead. 

 



"...You can't kill ideas with a sword, and you can't sink belief structures with a broadside. You defeat them by making them change..."

- From By Schism Rent Asunder

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thx1139 on 13 May 2009

That was sarcasm. Of course all of the costs arent associated with the 360. A certain group on VGChartz believes the opposite though.  It only makes senses that the Zune team and the Windows Mobile team are working closely together. 



Its libraries that sell systems not a single game.

heruamon on 13 May 2009
thx1139 said:

That was sarcasm. Of course all of the costs arent associated with the 360. A certain group on VGChartz believes the opposite though.  It only makes senses that the Zune team and the Windows Mobile team are working closely together. 


LOL...working on the Zune HD was free...in fanboy fantasy island...

"...You can't kill ideas with a sword, and you can't sink belief structures with a broadside. You defeat them by making them change..."

- From By Schism Rent Asunder

BladeOfGod on 15 May 2009

meh, its still not enough to cover all lost MS made with RROD and original Xbox. MS still lost over 9 billion on Xbox division



thx1139 on 15 May 2009

@herauamon,

My point exactly. So many people at VGChartz think that the business MS is currently spending more money then bringing in dont exist. This includes Zune, Surface, Windows Mobile, sales and marketing activities for Windows and Office retail. They just shove that aside and say no MS doesnt have a separate division for Xbox so they dont have to show that it is a business that is losing money.



Its libraries that sell systems not a single game.

thx1139 on 15 May 2009
BladeOfGod said:
meh, its still not enough to cover all lost MS made with RROD and original Xbox. MS still lost over 9 billion on Xbox division

 

 9 million where you pulling that from. Is it that goofy adjusted for inflation number that has been floating around on VGChartz?



Its libraries that sell systems not a single game.