Washington post: Investors want MS to kill Xbox
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GeorgioCostanzaX
Member
Pretty much, I think Kara Swisher summed it up pretty well on NPR the other day when someone asked what an activist investor hoped to gain out of divestment in the Xbox division and Bing: "I don't know another beach house maybe?"
Seriously, these guys can make millions just on a 1% increases in stock price and then they leave. They could potentially be making millions right now just by speculating to news media that MS will divest.
Truespeed
Member
Online is the only area that makes a loss.
Do you really think their "entertainment" division solely consists of Xbox? It's a bucket in which they dump a bunch of things into. And because all of these things are mixed into this bucket it's difficult to tell what made money and what lost money, but the Xbox has always been a chronic money losing division.
Dreamgazer
Member
I'm sorry for going OT, but I'm so sick of hearing this "competition is a good thing" line.
Competition is a good thing when consumers have the willpower and know how to properly identify their needs. Competition can be an absolutely horrible thing when consumers are weak minded, often time biased and susceptible to price and message manipulation (see: US medical industry, credit card industry, etc.)
Good competition has to be proven and be performed.
In addition, competition does not guarantee creativity. If anything, in a saturated market, it can create an anchoring effect...("COD is selling like crazy, let's make our games more like COD.")
Is competition always good?
Ovek
7Member7
Microsoft is currently refocusing back to the enterprise sector, you have to ask where does the Xbox devision/brand fit in that future? Bing yes, Surface I can see it, even Nokia can fit in to a enterprise focused Microsoft but Xbox it's nothing but a consumer device and huge money pit at that.
ultratruman
Banned
Also, I believe a great deal of the money from their entertainment division comes from a patent that google uses for Android (which gets them something like $8 for every android phone sold) but was ruled invalid by the European Union in December last year.
Oh god this again.
Dreamgazer
Member
I honestly don't know why so many people are so sensitive to the spin-off idea.
General Investors would get what they wanted.
Short term investors would be more than happy to go for the xbox pie.
MS gets xbox off their book.
Gates/Ballmer/MS can still dump money into it without care.
What's not to love?
Truespeed
Member
And yet IBM is still one of the most valuable brands in the world (#3 according to Business Insider, #5 according for Forbes, #4 at Interbrand). You don't reach these positions without having mind share.
People are worried without a deep-pocketed sugar momma it will die.
Not only that but the belief that no one would step up and take the spot. Someone will enter.
UnObtainium17
Member
Yeah... No fucking body would be using windows few years from now if they kill Xbox.
Bing is only alive in MS's eyes. It's been dead to all of us eversince it was launched.
Bing is only alive in MS's eyes. It's been dead to all of us eversince it was launched.
Yes, this very likely accurate assumption that may have factored into investors' wanting to kill Xbox, this assumption again.
Microsoft and investors don't worry about decade old losses.
Natureboy99
Banned
Pretty much. They thought they could buy the industry, and everything since has been trying to make that initial idea work.
That is not really true. I think they probably make more just off of patents compared to the Xbox. In this case, they would make more money if they licensed MS services rather than MS staying with Xbox. More money in the longterm and total volume I think. I don't have any proof of this besides the fact they make a ton of money just off of patents from android devices, which I read in an article on the internet. They would basically take down Xbox but could possible license things out as well as publish future games but keeping it simple like that might be in their favor.
GeorgioCostanzaX
Member
You'd be surprised at how much money Bing makes on advertising revenue alone. Sure it's nowhere near what Google does but some larger brands spend 10's of millions of dollars per year marketing on the platform.
If Microsoft leave the market and Apple step up and create a games console how much damage could that potentially do to MS in the longer term?
cyber_ninja
Member
Would like to see some other company take over the xbox brand; ms is just too filthy and greedy. I miss Sega...
Penguins&PolarBears
Member
Bing market share has grown consistently and substantially in the United States up to 18.2%. Bing is succeeding in the United States. Bing is powering search on Yahoo, Siri, Kindle Fire, and Facebook.
We know that...
There is virtually no chance of them dumping Bing or Xbox in the near term.
We know that...
- Windows is now dependent upon Bing and Xbox services for content (news and entertainment). Bing and Xbox services are going to continue to get embedded deeper into Windows and Xbox One.
- "Cortana" (Bing assistant) is coming to Windows and Xbox.
- Microsoft just bought a hardware manufacturer with 34,000 employees for over $7B. They are not going to stop making tablets and phones.
- Microsoft are opening up MS stores all over North America to sell devices.
- Microsoft is incubating wearable devices such as glasses and watches.
- Microsoft is the only major manufacturer of ARM-based Windows devices.
- The CEO of the company is originally from the Bing team.
There is virtually no chance of them dumping Bing or Xbox in the near term.
EmptySpace
Banned
Online is the only area that makes a loss.
and people wonder why investors want to kill off xbox. seriously, they don't care if the next halo comes out or not. they won't want to kill it if it makes a ton of money for them.
Truespeed
Member
Yahoo will be getting rid of bing as soon as they can. Meyer is already laying the ground work to get rid of them and take search back. And with Yahoo gone, their share of search falls even lower. As for that Nokia device division albatross around their neck - that's going to hemorrhage millions, if not billions, per year. And the additional 30,000 employees (a 30% increase) is going to be an additional burden. Microsoft will never be Apple and if they think they can compete against the OEM's then they're in for a world of hurt.
I don't understand this line of thinking when Xbox Live Anywhere was introduced in 2007, Zune (now Xbox Music and Xbox Video), Windows Phone, Windows 8 PC, and Surface, all of which feature Xbox (entertainment) content. It's been a broader consumer play for a long time now, since mobile took off for Android and iOS. And they've attempted multiple times, and failed every time, to break into the PC market (they now have Valve's former Steam lead heading up PC).
They were late to react and have stumbled a lot on it, but there's no denying that Xbox is more than just the living room and has been for a long time.
Penguins&PolarBears
Member
Yahoo is stuck in a contract with Bing until 2019. By 2019 nobody will be left going to Yahoo for web searches. Bing has already devoured more than half of Yahoo's search share. Marissa Mayer (former Googler) already tried to get out of the 2019 search contract and she was denied.
Yahoo cannot get out of the contract. By the time they can it won't matter anymore. Regardless Microsoft has been signing up more relevant companies since the 2009 Yahoo deal (Facebook, Apple, Amazon).
Liberty4all
Banned
Bing is getting better. I started using Bing about 6 months ago as it's embedded in my phone OS and has a dedicated hardware button to it (Nokia 920). I still prefer Google but it's not as lopsided as it used to be in terms of search results.
GeorgioCostanzaX
Member
Wouldn't be so sure about that. Honestly, Yahoo!'s share of search is pitifully small and shrinking which is why they continue to get guaranteed revenue share from Microsoft. Bing has a better brand resonance with advertisers in my experience and Yahoo! is more like an afterthought. Yahoo! has much better content on it's top verticals like News, Sports, The Home Page, and Finance but the amount of folks that actually search on Yahoo! is pretty small.
If they drop Microsoft I think Yahoo! is effectively dropping half it's audience unless they do something really cool that improves upon Google's blue links in a meaningful way.
The Hermit
Member
really? intersting
I tried using Bing. It works, but there's this other thing called google and it's much better.
My thoughts on the issue is-- the console market as it is at this moment is a mess and will be even messier in the near future with all companies wanting to put their foot in the console market (ie. valve, amazon, samsung, apple and probably more tba). Someone has to go.
My thoughts on the issue is-- the console market as it is at this moment is a mess and will be even messier in the near future with all companies wanting to put their foot in the console market (ie. valve, amazon, samsung, apple and probably more tba). Someone has to go.
IMO. There is no other systems out there that can replace the Xbox for me. Nothing.
Going through pages and reads that some wants the Xbox to fail is just measurable.
I mean I get that you some of you don't like it, And no one is forcing you to do. That's why you obviously have another choice to choose from. You see the irony here? Choice.
Ever thought about those who actually like it? Or the hatred just covers your wisdom?
choice is what the industry needs.
that is why you love whatever and some love whatever. If we are stucked with one than there is no competition.
As for me, If Xbox dies. Which I don't think it will do anytime soon, Then it's over for me as a gamer. I wouldn't consider any other alternatives cuz I have them all , Tried them all and knows where my heart is. With Xbox
Penguins&PolarBears
Member
Take the one time aQuantive write off out of the 2012 numbers (aQuantive has nothing to do with 2012) and you see a chart that shows Bing is growing steadily towards profitability. There is no justification to divest Bing when we don't have any idea where it's profitability or usage will eventually plateau. Microsoft's strategy with Bing appears to be moving in the right direction for now.
Windows is far more troubling for Microsoft than Bing at the moment.
MrNyarlathotep
Banned
Because Ms are the only people who see any benefit whatsoever in such devices.
Consumers don't.
Agreed. The profits that they made with the Xbox division from 2008 to 2013 are peanuts compared to Windows, Office, & even Servers, & most likely didn't even erase the losses that they made from 2005 to 2007, except for RROD that costed them $1 Billion.
From what I understand, 2011 was their best year with $1.2 Billion.
Imperfected
Member
Again: no, you don't, and this doesn't work anyway.
No one buys a PC because they own an X-Box. If anything, owning an X-Box gives you one less reason to buy a PC. Microsoft doesn't need brand loyalty. If you live near in an urban center, look down the street. You see all those businesses? The retail outlets, the hotels, even the management offices of your apartment building? They use Microsoft products.
You pay a Microsoft 'tax' pretty much any time you shop anywhere or do anything. This is where the company's phenomenal revenues come from. The portion of their income that comes from intentional user-level interaction with their goods and services is trivial, unreliable, and ultimately not worth bothering with. They are to software what Monsanto is to food, what Exxon-Mobil is to automobiles, what General Electric is to utilities: a company you can't actually opt-out of buying from or working with, a foundational entity that stands to make eternal profits in their core competency regardless of consumer will as long as they don't do something ridiculously stupid like sacrifice their stranglehold on that field in pursuit of quick riches in far more fickle, consumer-facing industries.
If they wanted to hold onto their home computer sales, they should have spent the money they've wasted on X-Box growing PC gaming. That ship has long sailed, though - or at least moved a few blocks down the road, along with the former Microsoft employees who knew better - and there's no real stopping the home market from getting cannibalized now. They can either try to leapfrog Apple to the next innovation or opt-out and refocus on enterprise services, as many are suggesting.
There's no scenario where they "grow the brand" of X-Box so much that it magically causes everyone to go out and buy Windows Home Deluxe and Office 2014, though. I have no idea where you guys are even getting this notion. No one at Microsoft ever even believed that was going to happen, much less industry analysts. Again, the X-Box is cannibalizing the home PC if it's doing anything, because a person with an iPad and an X-Box One seriously has to ask themselves if they need a home PC for anything. They're robbing their own till at this point.
KingJ2002
Member
Bing - Makes sense but not recommended as search will play a big part in the future of all software tech.
Surface - rebrand or kill this off... Microsoft needs to provide a true tablet experience that takes advantage of metro
Xbox - Keep around... best way to get into the home. especially with Apple & Google finding a way to get in themselves.
WIndows - Windows 8.1 clearly didn't marry the world of Windows Desktop and Metro. Windows 9 needs to succeed there.. a unified OS with NO TIERS is the future.
Surface - rebrand or kill this off... Microsoft needs to provide a true tablet experience that takes advantage of metro
Xbox - Keep around... best way to get into the home. especially with Apple & Google finding a way to get in themselves.
WIndows - Windows 8.1 clearly didn't marry the world of Windows Desktop and Metro. Windows 9 needs to succeed there.. a unified OS with NO TIERS is the future.
Penguins&PolarBears
Member
They sold 35 million Windows Phones last year and several million Surface/Lumia tablets. Windows Phone sales more than doubled from the previous year. The numbers may pale next to Samsung or Apple, but there is significant growth happening (enough to justify buying Nokia's mobile hardware division).
There will most likely be additional devices that run Windows on ARM (glasses, watches, etc.).
Intel is not a big enough player in mobile to make Windows reliant on Intel delivering mobile chips competitively with ARM manufacturers like Qualcomm.
A 500 dollar videogame console is not a good way to get in the home. And getting into the living room is already a very dated concept anyways.
I imagine some of those costs are related to Xbox One R&D, console development, launch, and marketing, right? I don't have Microsoft financial statements in front of me so I might be wrong.
Moneyhatting worked last gen. Do investors have patience to wait for similar results this gen? I want stronger Xbox One first party support. That's just me, selfish gamer, giving my two cents.
KojiKnight
Member
Microsoft won't put their games on iphone till they give up the dream of windows RT and windows phone, which is what the investors want. After they have their way in that regard, you can bet it'll come up if they can't take the xbox division down.
Louis Cyphre
Banned
IMO. There is no other systems out there that can replace the Xbox for me. Nothing.
Going through pages and reads that some wants the Xbox to fail is just measurable.
I mean I get that you some of you don't like it, And no one is forcing you to do. That's why you obviously have another choice to choose from. You see the irony here? Choice.
Ever thought about those who actually like it? Or the hatred just covers your wisdom?
choice is what the industry needs.
that is why you love whatever and some love whatever. If we are stucked with one than there is no competition.
As for me, If Xbox dies. Which I don't think it will do anytime soon, Then it's over for me as a gamer. I wouldn't consider any other alternatives cuz I have them all , Tried them all and knows where my heart is. With Xbox
I too find it odd that those who seem to revel in how great the PS4 is always manage to find the time to tell everyone why the XBox is bad. Didn't the PS3 show Sony at its weakest after having the most successful console in history? Looks to me like MS is the only ones capable of keeping Sony grounded by being the biggest competitor to them.
Truespeed
Member
That doesn't really bode well when one of your biggest clients is trying to weasel their way out of using your search engine. Yahoo will continue to look for loopholes to get out of the contract and even if they are forced to adhere to the length of the contract then they'll simply jettison bing in 2019. Yahoo is still one of the most visited portals on the Internet and will continue to be so. A better question would be what share of the search market will bing have after 2019 when Yahoo gets back into the game and Facebook starts using their own engine.
Yes, but is that the most profitable route?
Spoiler: No it is not. Especially not for the investors.
Also they'd be selling those departments, not closing it.
Penguins&PolarBears
Member
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Microsoft can do both. You can put software out on competitors platforms and make your own hardware. iTunes running on Windows is what made Apple such a success story. Putting your software and services on other platforms is a great way to eventually get people to buy your hardware. Apple -iTunes. Valve -Steam. Amazon -Kindle.
Xbox makes sense of first to go actually if they're looking to change to business oriented.
Bing - Why lose Bing? It's the #2 search engine right now behind Google. Think about that. It's not been around very long and it's #2. The tech can be used for all sorts of internal applications at the enterprise level.
Surface - If we're looking to sell to enterprises, surface isn't bad. It's consumers that you're not going to see want a surface. It's actually a really great tablet, just everyone hates Windows 8 so much there's no winning without a good OS. I can see them ditching it as a consumer product, and refocusing it to businesses.
Xbox - Completely consumer oriented. There's no where to go with it but to more consumers. If people aren't interested, they're not going to buy it (see: Surface). Unless the X1 can really bring some money in, I don't see how they can spin it to be business oriented.
Bing - Why lose Bing? It's the #2 search engine right now behind Google. Think about that. It's not been around very long and it's #2. The tech can be used for all sorts of internal applications at the enterprise level.
Surface - If we're looking to sell to enterprises, surface isn't bad. It's consumers that you're not going to see want a surface. It's actually a really great tablet, just everyone hates Windows 8 so much there's no winning without a good OS. I can see them ditching it as a consumer product, and refocusing it to businesses.
Xbox - Completely consumer oriented. There's no where to go with it but to more consumers. If people aren't interested, they're not going to buy it (see: Surface). Unless the X1 can really bring some money in, I don't see how they can spin it to be business oriented.
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