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[meanspartan]

investors, idiots with no vision except for the immediate bottom line

I get this, but, it HAS been over ten years with only a few years of modest profits to speak of, and overall big losses.

So it is fair to argue that Xbox had its chance, but given going on 13 years now has not been a profitable venture.

That said, if I were in charge no way I'd get rid of the division. Because we JUST spent all this money getting Xbox One out there, no way I pull back now. Just see how it goes, but perhaps not spend so much getting exclusives other than maybe timed exclusives.

And then, if at the tail end of this generation the division still isn't making decent profits, no next gen Xbox.

 

[SPDIF]

It's topical enough. There's a new CEO, the strategic direction of the company is now in new hands, and consumer devices have long been a contentious subject for Microsoft.

Well I'm not saying this shouldn't be a thread, but it doesn't change the fact that it's a thread based on an article that contains no new information. As I've already said, Nadella's keen on carrying on with the devices and services approach. If people are really interested in hearing his views on the future direction of the company they should watch these two videos:

Satya Nadella: His first interview as CEO of Microsoft

Susan Hauser interviews Microsoft CEO Satya Nadella (more in depth 16 minute long interview)

 

[Steel]

The other side is already touched upon in this thread, which is the opportunity cost of the Xbox platform. Even if they could control the living room, or operate profitably in that space, it's not enough. If those dollars could be more profitably invested in other areas, then that is what they should do. It's similar to if you had a choice between 2 investments, one returned 15%, one 5%, you obviously take the 15. Some of Microsoft's investors feel like they could take those dollars and resources, invest elsewhere, and make more.

While I mostly agree with what you're saying there's value in a diversified business. Putting all your eggs in one basket isn't a great idea, there's no gurantee that one thing will always make a profit. That being said, microsoft already has their hands in a lot of things. It's just that a lot of them aren't that successful or are outright failures. The company just seems like it's been throwing ideas at the wall for safe ways to diversify their business, and hasn't quite found a place where they can stick. That being said, they can certainly afford to keep this up.

 

[Phades]

Nintendo buys Xbox

swerve

I think in the printed paper based newspaper we read the next day about how the internet went down in flames would have been prefaced with a reference to something of this nature.

 

[justsomeguy]

We often talk about the consumerization of business products, the CEO wants iPad development because he has an iPad at home, employees start bringing in their Android and iPhones. People start using at the office the software they like at home. This turns people away from Microsoft.

Very true and we (Microsoft) are way later to the market than we should have been. But CoIT is a huge opportunity too - cxos play with the iPad, but when we show them what we can do (Surface Pro) or what our partners can do (Dell venue pro 8 to name one stand-out example) , throw in the usual good Enterprise Management story we have, then you find an awwwful lot of them suddenly get very interested in what we have to offer on the Windows platform around portable devices. There's also a huge opportunity managing all those "bring your own device" scenarios, so while it's a threat to our traditional market, it opens up new ones.

Would it be better for MS if everyone was already bringing in Windows devices and ipads were the "lol" device? Yes of course but there's a new market for us there still.

Btw anyone who hasn't seen the venue pro 8 and is in the market for a portable device, check it out - 8" tablet that runs full windows. Folks at work who have one are raving about them.

 

[jcm]

Why wouldn't it? Opportunity costs don't stop being a consideration just because you're big. Resources are still finite, and low returns are still low returns.

Because they can afford to do literally anything they choose. Want to set up a bunch of fabs and challenge Intel for CPU dominance, or to create a new professional football league and challenge the NFL, including a dozen new stadiums?* By all means.

I can see the argument that it's a distraction, or the argument that they'd be better off selling services to Sony, Nintendo and a standalone Xbox Inc**, but lack of capital isn't holding them back any. Spinning off Xbox isn't going to free up cash that they'll put into an exciting new business. What MS really needs is ideas, not money, and making video game consoles isn't costing them ideas.

* I mention these ideas because they are crazy and capital intensive, not because I think they're a good ideas.

** This might actually be true

 

[Gestault]

The opportunity cost is the cost to continue to operate, and the profitability thereof, compares to the costs & benefits of doing something else. Profits and losses in past years have no bearing, nor do prior investments. That's all sunk.

They're not going to drop the Xbox division just because it was in the red for 10 years, because that's the past and nobody cares. But at the same time, if it's going to only produce low returns going forward, it's basically a distraction, one they might decided they don't need, or one they think they could better use those resources elsewhere. It could be a profitable business, but that doesn't make it one worth having.

You were rationalizing that the capital used in the Xbox division was preventing investment elsewhere. I pointed out that the company has a large pool of capital on standby for whichever investments it thinks are worthwhile.

 

[gcubed]

I'm always amused that people tend to forget that there was time less than 20 years ago when Apple's OS 8/9 was a ugly OS and Apple hardware were mediocre machines that no mainstream user would ever care about (not to mention unnecessarily heavy for their specs.)

Any reputation can be changed in a second.

Although that's the problem with MS. No one has the guts to change that corporate culture like Job's did with his return to Apple.

Soo... You're agreeing with me?

 

[Occam]

As Microsoft shareholder I fully agree that Microsoft should kill Xbox.

 

[Hari Seldon]

I'm guessing that this will be the last gen of xbox.

 

[SEGAvangelist]

Well I'm not saying this shouldn't be a thread, but it doesn't change the fact that it's a thread based on an article that contains no new information. As I've already said, Nadella's keen on carrying on with the devices and services approach. If people are really interested in hearing his views on the future direction of the company they should watch these two videos:

Satya Nadella: His first interview as CEO of Microsoft

Susan Hauser interviews Microsoft CEO Satya Nadella (more in depth 16 minute long interview)

Exactly. The news article title from the Washington Post is pretty much click bait. They can get away with it, though, because there is a new CEO making this discussion relevant of course.

 

[Doffen]

there's no way they'd sell the patents to other tech companies, they'd either start patent trolling themselves or, more likely, pass them off to an existing troll firm like intellectual ventures (founded by ex-microsofters and part owned by microsoft) in exchange for a cut of whatever settlements/judgements come their way

Microsoft's entertaimnent patents, assets and IP's are easy to avoid for competing companies. Selling them would give them a certain income. Holding them and kill the division would only guarantee no future investments loss and save them for R&D.

I'd be okay with that. ms makes great software (windows, office, visual studio, server) but their jump into consumer devices has been such a waste. I'm inclined to add the bone to that list after the DRM debacle. if be preferable if they jumped out and Nintendo or someone else got their head in the game

Wii U is a product of Nintendo not focusing on the competition. Do you really think 1 less competitor would help them gain focus on what the market wants?

 

[Randolph Freelander]

While I mostly agree with what you're saying there's value in a diversified business. Putting all your eggs in one basket isn't a great idea, there's no gurantee that one thing will always make a profit. That being said, microsoft already has their hands in a lot of things. It's just that a lot of them aren't that successful or are outright failures. The company just seems like it's been throwing ideas at the wall for safe ways to diversify their business, and hasn't quite found a place where they can stick. That being said, they can certainly afford to keep this up.

It was a simplified opportunity cost analysis, where the implication is that you can only do one. For a company, there's going to be lots of choices between competing things, just as there are in your own personal investments, so it's not to say there's no diversification. At the same time, you don't add a low return vehicle if a high return vehicle achieves the same diversification goals within your risk strategy.

 

[Linkified]

It's topical enough. There's a new CEO, the strategic direction of the company is now in new hands, and consumer devices have long been a contentious subject for Microsoft.

Which will be following the same approach and double down on the Devices/Services/Software.

Phil Spencer stated Satya liked the Microsoft Studios, plus Satya kept reinforcing the idea of Play & Productivity in the first interview he did.

 

[SPDIF]

We're talking about profits. I doubt .NET and Visual Studio register, however popular they may be as tools.

Well VS is part of their Server and Tools business (or whatever it's called nowadays after their reorg) which is a big money maker. And in more recent times they have their Azure cloud business which has been growing very quickly. It's recently joined their "billion-dollar business club" in fact.

 

[nib95]

Look back to 2005/06 and see what Sony did when they felt they had the market to themselves...

I loathe the direction MS took the Xbox brand in, but let's not assume that the PS4 would be as attractive as it is if Sony hadn't gotten their ass kicked last gen.

But that's fine by me, since it does not affect my love for the hobby in the long run. I can just choose not to buy the console and opt for a competitor (Nintendo/PC) instead. There's a big difference between creating a console that is too high priced, and trying to usher in new anti consumer policies that will change the face of console gaming forever.

 

[staticneuron]

First, those costs are already spent. You don't abandon a product because it cost you money to develop it--you abandon a product because it's costing you money NOW, which the Xbox One isn't. If R&D is the issue, the to exit the industry is before you develop a console, not after.

Second, at no point while they were spending that money on R&D was the division ever a money-loser. Xbox 360 gains made up for Xbox One R&D losses.

Xbox isn't a problem like Bing or Surface, which are actively pissing away cash. Xbox is a distraction. Investors who are critical of MS aren't arguing that Xbox is a money pit, they're arguing that Xbox is taking away focus and tying up capital that could be use on more lucrative projects and programs. Basically, when you're a company that has multiple ten+ billion dollar profit market segments, why play around with 1 billion dollar market profit segments?

But isn't the possibility of pushing their products into home environment worth it? Like a really high budget advertising push, except they make a bit of profit? The UI for the one, the bing searches, making skype, outlook, skydrive and others accessible and upfront for home users sounds like a positive move and one that will push the brand in two directions. Home and corporate focuses.

 

[aeolist]

Very true and we (Microsoft) are way later to the market than we should have been. But CoIT is a huge opportunity too - cxos play with the iPad, but when we show them what we can do (Surface Pro) or what our partners can do (Dell venue pro 8 to name one stand-out example) , throw in the usual good Enterprise Management story we have, then you find an awwwful lot of them suddenly get very interested in what we have to offer on the Windows platform around portable devices. There's also a huge opportunity managing all those "bring your own device" scenarios, so while it's a threat to our traditional market, it opens up new ones.

Would it be better for MS if everyone was already bringing in Windows devices and ipads were the "lol" device? Yes of course but there's a new market for us there still.

Btw anyone who hasn't seen the venue pro 8 and is in the market for a portable device, check it out - 8" tablet that runs full windows. Folks at work who have one are raving about them.

so when is windows RT going to be killed off?

 

[SMOK3Y]

The Xbox strategy doesn't even make sense anymore. Spend a bunch of money every 5-6 years in the hopes of making it back over a generation, to do what? Stymie Sony?

to me this is the only reason they are in the console market at all theres no history or passion from them

 

[Concept17]

Isn't the cost of Xbox somewhere between 7 and 10 billion now when you include Kinect and X1? With only a couple years of profit with the 360, you can hardly blame them.

 

[thehunter01]

Isn't the cost of Xbox somewhere between 7 and 10 billion now when you include Kinect and X1? With only a couple years of profit with the 360, you can hardly blame them.

How can you even spend that much money on such devices just boggles my mind. Where does all the money go?

 

[Randolph Freelander]

Because they can afford to do literally anything they choose. Want to set up a bunch of fabs and challenge Intel for CPU dominance, or to create a new professional football league and challenge the NFL, including a dozen new stadiums?* By all means.

I can see the argument that it's a distraction, or the argument that they'd be better off selling services to Sony, Nintendo and a standalone Xbox Inc**, but lack of capital isn't holding them back any. Spinning off Xbox isn't going to free up cash that they'll put into an exciting new business. What MS really needs is ideas, not money, and making video game consoles isn't costing them ideas.

* I mention these ideas because they are crazy and capital intensive, not because I think they're a good ideas.

** This might actually be true

They cannot afford to do literally anything they choose. Literally anything requires infinite resources, they do not have it.

The fact is they don't build up that capital just to spend it freely, and Xbox versus one other thing isn't the only choice they make. Again, just because they're big doesn't mean they can blow money on whatever they wish and if it makes a dollar, that's good enough. They have to spend that money wisely. Sometimes, it's investing in new business areas. Others, it's reinvesting in what they're already doing. Still other times, it's giving that money back to shareholders. Them having $XXX billion in the bank doesn't give them license to do whatever low-return investment they feel like. It's still a choice between doing that versus doing something better, or multiple things better, and that doesn't change just because you have a lot of capital.

 

[Eoin]

But the thing is, the Playstation brand is more profitable for Sony than the Xbox brand is for Microsoft. And even if Sony goes down, there's a higher chance that the Playstation brand will be bought by another company more so than the Xbox division because of all of the losses that Xbox has racked up.

Gaming has existed long before Microsoft came into the picture, & it will still go on, with or without Xbox.

Lol, you think any potential buyer would care about losses from 7+ years ago? They would only care about the current state of the business and future projected earnings. Also where did you get the idea that Playstation was currently more profitable? That wasn't the case last gen, maybe with the ps4 that could change, but it hasn't yet.

 

[Imperfected]

Closing or selling the Xbox division will bring about the end of Windows? How did you arrive at that conclusion?

Obviously, the X-Box brand has a huge conversion rate of causing people to go out and buy Windows PCs.

... oh wait, if it weren't for consoles gaming would probably split between PCs and mobile devices, and Windows still reigns as the de facto operating system for PC gamers. If anything, it would probably push more users into Windows if the X-Box didn't exist, and it does almost nothing to "convert" users into their "ecosystem". Hmm!

That said, the main problem with them selling off the division isn't mustering up the desire or approval to do so, it's finding a buyer willing to pay enough. Even assuming they carve up some of the pieces to try and reduce the lump sum cost any single buyer would have to pay, they'd be looking at a pretty high asking price for a relatively low-performance collection of assets.

If they want to sell, they're probably going to have to ride it out for a few years and let the value of the division diminish - as it naturally will, right now it's pretty much peaked because the R&D and initial marketing for the X-Bone is sunk but most of the potential profits are still ripe on the vine, the further into the generation we go the less potential profit it has and the more the costs for next generation begin to loom. A year or two from now the asking price will probably be low enough they can start shopping around for a buyer, especially if the X-Bone under-performs expectations.

Right now - at least for a brief time longer - they have too strong of a bargaining position, since the division at least looks strong on paper (their sales compared to the 360 are very good). Most buyers would probably want to wait a bit and hope that sales stall so that Microsoft finds themselves antsy to off-load the division for cheaper.

 

[GravityMan]

Yawn. Not much in the way of interesting news here.

Investors are saying these things because they are acting in their own best interest. So of course they want MS to put most or all of their focus on their biggest market segments (e.g. enterprise).

Unless the Xbox One somehow ends up being a major failure (unlikely), MS ain't getting rid of Xbox. Or Surface, either.

 

[Lokbob]

High risk low profit business. I can't blame them, If theyre in for the money its kinda not worth it.

 

[Earendil]

Samsung Xbox has a nice ring to it.

Galaxy SBox...

 

[badcrumble]

Obviously, the X-Box brand has a huge conversion rate of causing people to go out and buy Windows PCs.

... oh wait, if it weren't for consoles gaming would probably split between PCs and mobile devices, and Windows still reigns as the de facto operating system for PC gamers. If anything, it would probably push more users into Windows if the X-Box didn't exist, and it does almost nothing to "convert" users into their "ecosystem". Hmm!

That said, the main problem with them selling off the division isn't mustering up the desire or approval to do so, it's finding a buyer willing to pay enough. Even assuming they carve up some of the pieces to try and reduce the lump sum cost any single buyer would have to pay, they'd be looking at a pretty high asking price for a relatively low-performance collection of assets.

If they want to sell, they're probably going to have to ride it out for a few years and let the value of the division diminish - as it naturally will, right now it's pretty much peaked because the R&D and initial marketing for the X-Bone is sunk but most of the potential profits are still ripe on the vine, the further into the generation we go the less potential profit it has and the more the costs for next generation begin to loom. A year or two from now the asking price will probably be low enough they can start shopping around for a buyer, especially if the X-Bone under-performs expectations.

Right now - at least for a brief time longer - they have too strong of a bargaining position, since the division at least looks strong on paper (their sales compared to the 360 are very good). Most buyers would probably want to wait a bit and hope that sales stall so that Microsoft finds themselves antsy to off-load the division for cheaper.

This. MS abandoning console gaming wouldn't look like them pulling the rug out from under the Xbone mid-generation like what happened to the Dreamcast. It would look like them continuing through this generation as per normal, but never beginning the R&D process for the next generation.

 

[Doomshroom]

They dont need to drop just focus it. Dont try to be everything try to be the best at something. Also fuck kinect dont try to be the best at kinect.

 

[rager]

I would love for xbox to die and for sega to reemerge. Sega, Sony, Nintendo would be a great combo. I always hated the name xbox too. stupid.

 

[Earendil]

We're talking about profits. I doubt .NET and Visual Studio register, however popular they may be as tools.

I doubt they have lost money on it. That was the point I was trying to make, not that they are huge money makers.

 

[GoodCoffeeJoey]

Never gonna happen while Gates and Balmer are against it.

 

[jcm]

They cannot afford to do literally anything they choose. Literally anything requires infinite resources, they do not have it.

The fact is they don't build up that capital just to spend it freely, and Xbox versus one other thing isn't the only choice they make. Again, just because they're big doesn't mean they can blow money on whatever they wish and if it makes a dollar, that's good enough. They have to spend that money wisely. Sometimes, it's investing in new business areas. Others, it's reinvesting in what they're already doing. Still other times, it's giving that money back to shareholders. Them having $XXX billion in the bank doesn't give them license to do whatever low-return investment they feel like. It's still a choice between doing that versus doing something better, or multiple things better, and that doesn't change just because you have a lot of capital.

But you're no longer talking about opportunity cost. You've changed the subject to maximizing ROI. Which is a noble goal, but it's an entirely different thing.

We're talking about profits. I doubt .NET and Visual Studio register, however popular they may be as tools.

Server and Tools is a much better business for them than Xbox is.

 

[140.85]

Isn't the whole reason for Xbox existing because MS imagined a future where an all-encompassing multimedia/game Playstation would take over the living room uncontested?

I feel like that was a bad read. The landscape has changed so much. I don't think that scenario is the biggest threat to Microsoft.

 

[Randolph Freelander]

But you're no longer talking about opportunity cost. You've changed the subject to maximizing ROI. Which is a noble goal, but it's an entirely different thing.

?

That's basically the point of what an opportunity cost is.

 

[KojiKnight]

In in Microsoft's case investment capital isn't infinite... The money they spent on xbox over the last decade would have likely netted them more money simply being invested in a simple stock portfolio...

Investors only care about one thing, return on investment. The greater RoE the better... no doubt they'd prefer microsoft got rid of the BAD first (bing and surface) but after those are gone they'll go after the less profitable entries next.

 

[thehunter01]

This. MS abandoning console gaming wouldn't look like them pulling the rug out from under the Xbone mid-generation like what happened to the Dreamcast. It would look like them continuing through this generation as per normal, but never beginning the R&D process for the next generation.

I never understood why they builded the x1 anyway. they could just have gone for something what steam boxes are going to be. Make sure you have a minimum spec that all these boxes have to do with ( let other company's just make tv fit solutions with that hardware solution ). and just let your first party developers build games for that spec. So everybody basically can get there own product at different prices and with different requireements.

Also let it run windows and throw the games also on the windows department.

But instead they had to make some box again that runs its own software etc etc, and just furters consumers more away from windows all together.

I never understood why they alienated gamers from there windows platform, seems like bad business to be honest.

 

[jcm]

?

That's basically the point of what an opportunity cost is.

No, it's not. The opportunity cost of a choice is the value of the best alternative forgone. What I'm saying is that there is no alternative forgone due to the Xbox capital requirements. If they weren't putting it into Xbox it'd be in T bills.

 

[Septimus Prime]

Windows has to stay relevant in the consumer market, because that's where their competition is playing. Apple and Google are gaining, or already have everything they need from hardware, OS, and/or services to enable consumers and businesses the easiest and most complete online ecosystem for fun and work. The more inroads they make on consumers the less relevant Windows, Office, Azure, etc. become.

Productivity and entertainment are going all digital and moving to the cloud. It's a software and services future. The best long term strategy you could have in an all digital future is hooking someone into an ecosystem early, letting them build their productivity and entertainment library on a single account. They become invested, and then the services provider becomes invested in keeping them in the ecosystem. Apple and Google already have alternatives to nearly everything Microsoft does, so the more consumers they get into their own ecosystems the more they'll invest in keeping them there.

Don't think out just a handful of years. Look at the lifetime value of a consumer in an all digital world. What would you do? I would continue investing in mobile, cloud, productivity, and entertainment, with a focus on delivering high value services and experiences that draw people into the brand.

The thing is, they don't actually need a physical Xbox console for any of this. Xbox LIVE and Kinect are already strong brands on their own (arguably stronger than Xbox itself), and MS could really just license out Xbox LIVE to run on multiple platforms, like iOS, Android, Mac OS, and eventually even competitor platforms. Then they can still hook people and push their services.

 

[Graphics Horse]

If they want to sell, they're probably going to have to ride it out for a few years and let the value of the division diminish - as it naturally will, right now it's pretty much peaked because the R&D and initial marketing for the X-Bone is sunk but most of the potential profits are still ripe on the vine, the further into the generation we go the less potential profit it has and the more the costs for next generation begin to loom. A year or two from now the asking price will probably be low enough they can start shopping around for a buyer, especially if the X-Bone under-performs expectations.

Right now - at least for a brief time longer - they have too strong of a bargaining position, since the division at least looks strong on paper (their sales compared to the 360 are very good). Most buyers would probably want to wait a bit and hope that sales stall so that Microsoft finds themselves antsy to off-load the division for cheaper.

Sounds like they should put that Nokia guy in charge.

 

[Occam]

investors, idiots with no vision except for the immediate bottom line

I'd appreciate it if you didn't insult me. As a Microsoft shareholder myself, I share the vision of those other investors of a video game industry without Microsoft in it.

 

[Biker19]

Lol, you think any potential buyer would care about losses from 7+ years ago? They would only care about the current state of the business and future projected earnings. Also where did you get the idea that Playstation was currently more profitable? That wasn't the case last gen, maybe with the ps4 that could change, but it hasn't yet.

With the exception that Sony has pretty much lost all of the money that they made from PS2 (& probably PS1) with PS3, the PS division as a whole is still in the black.

Even if you don't count the losses that Microsoft has lost in the past with Xbox, the Xbox brand as a whole is still in the red as of right now. What smart company would purchase a certain brand that's been in the red for so long, in which they also have to pay off the losses that a certain division/brand has occurred in order to own it?

 

[RedSwirl]

So basically, some people think that if Microsoft wants to "take over the living room" it should do so purely through its software and services on other devices.

 

[ShinMaruku]

Isn't the Xbox division one of the few making profit at MS? They'd be insane to kill/sell it.

Profit from it does not make up for losses in other areas.

 

[SlipperySlope]

Xbox is the one that makes the most sense to keep around.

To be honest, for me it's Bing. Biggest upside in both revenue and profits. For X1, I see the division at best flat-lining compared to last gen.

But if Bing becomes a decent second to Google, there's massive ad money to be had for Microsoft. And frankly, Bing is Google's only real competitor in the search space. I don't want Google to be a monopoly again in search.

Edit - And Microsoft can push people to Bing unlike XBox. Windows Phone, Windows, IE, XBox, Surface, et all can all use Bing as their default search engine. It's easily integratable into a bunch of their devices and software.

 

[hoos30]

Same investors, new article. Not much really new here.

 

[digoutyoursoul]

I'd appreciate it if you didn't insult me. As a Microsoft shareholder myself, I share the vision of those other investors of a video game industry without Microsoft in it.

Could you elaborate on why you think they should call it a day with Xbox ? Not being aggressive or anything, just curious to see a shareholders perspective.

 

[Sydle]

Isn't the whole reason for Xbox existing because MS imagined a future where an all-encompassing multimedia/game Playstation would take over the living room uncontested?

I feel like that was a bad read. The landscape has changed so much. I don't think that scenario is the biggest threat to Microsoft.

They thought a competitor in the living room for entertainment would threaten Windows. They were right about entertainment, but wrong about the device -- it was mobile.

That said, if they're serious about being an entertainment brand they cannot give up a major screen (the TV), especially when it's the only really successful device in their devices lineup to build up the entertainment brand side of things. And I'd argue there is more money to be made by selling millions of $20-$60 games, as well as getting royalties off of third-party games, than there is in having just a Roku box that plays casual games.

 

[thehunter01]

Obviously, the X-Box brand has a huge conversion rate of causing people to go out and buy Windows PCs.

... oh wait, if it weren't for consoles gaming would probably split between PCs and mobile devices, and Windows still reigns as the de facto operating system for PC gamers. If anything, it would probably push more users into Windows if the X-Box didn't exist, and it does almost nothing to "convert" users into their "ecosystem". Hmm!

That said, the main problem with them selling off the division isn't mustering up the desire or approval to do so, it's finding a buyer willing to pay enough. Even assuming they carve up some of the pieces to try and reduce the lump sum cost any single buyer would have to pay, they'd be looking at a pretty high asking price for a relatively low-performance collection of assets.

If they want to sell, they're probably going to have to ride it out for a few years and let the value of the division diminish - as it naturally will, right now it's pretty much peaked because the R&D and initial marketing for the X-Bone is sunk but most of the potential profits are still ripe on the vine, the further into the generation we go the less potential profit it has and the more the costs for next generation begin to loom. A year or two from now the asking price will probably be low enough they can start shopping around for a buyer, especially if the X-Bone under-performs expectations.

Right now - at least for a brief time longer - they have too strong of a bargaining position, since the division at least looks strong on paper (their sales compared to the 360 are very good). Most buyers would probably want to wait a bit and hope that sales stall so that Microsoft finds themselves antsy to off-load the division for cheaper.

Why would they even do this? They can far rather keep the whole brand and push it in software form on windows or other products. No point in selling it at all. Investers just want to get rid of all the massive amounts of cash thrown away for hardware that only pushes more and more people away from the windows brand.

They wll far rather throw the entire xbox devision in the garbage then sell it of for absolute nothing and create more competition against there only left platform windows.

 

[RustyNails]

This will be so bad for the industry. But investors always say all sorts of dumb shit.