BananaSprinkles
Banned
You're taking this way too personally, and nobody said Microsoft as a company was failing.
June 2014 NPD (U.S. Hardware) Predictions - Closes July 15th
- Thread starter donny2112
- Start date
You're taking this way too personally, and nobody said Microsoft as a company was failing.
I always wonder why fans of the system can't acknowledge the state of the system when the executives do through their actions. But I guess they are just ripping out the kinect lowering the price, bundling games for free and giving away gift cards and bonus money because MS are such nice people.
ethomaz
Banned
XB1 did have a great start in US/UK.
But the last two months it did terrible... this is a fact... number close to Wii U level and way under previous consoles.
It is not only losing to the PS4... it is not eve giving a fight in the last month... yeap I call that terrible.
I hope it increases sales over 100k this month to start look fine.... over 150k will be great.
BTW if XB1 was doing fine MS won't take all these desperate actions to fix it sales.
But the last two months it did terrible... this is a fact... number close to Wii U level and way under previous consoles.
It is not only losing to the PS4... it is not eve giving a fight in the last month... yeap I call that terrible.
I hope it increases sales over 100k this month to start look fine.... over 150k will be great.
BTW if XB1 was doing fine MS won't take all these desperate actions to fix it sales.
You know, using May is not really being fair here. It's only done less than 100k in May, a month where early in the month they announced a SKU that many people were hoping for to come out next month. Other than that at worst it's been a little more than half the PS4 sales and that's only on some months. Yes, May's numbers were horrible, but that was one month. A month where people could have been holding out for the new SKU in June. I don't really think we can say they are doing terrible yet. They're definitely (not even slightly) doing better than Wii U or Vita (which I agree doesn't say much but you're acting like they are almost Wii U levels). I think they're doing well enough to at least keep getting most third party developer support (They aren't going to get abandoned by the third parties yet anyways).
And I say this as some one who does have a bias and wants to see PS win. And at one point wanted to see MS fail but now I'm back to don't care for them but not actively annoyed by them either (and I think they've hurt enough to get the point, I do think their policies should hurt them even after the 180 to show them that yes, it does hurt to try it even if you take it back so maybe next time you should listen rather than attempt it anyways). They've at least managed to show they are willing to cave to the consumer.
And yes, I do think that in their mind they caved, it's not that they really cared to give the consumer what they wanted but they realized they had to. But that's more credit than I gave MS at one point in time. At one point in time I figured MS would just say "Deal with it" and still try to push it until it was just way too obvious it wouldn't work. Hell, they got rid of the thing that made me really incensed at them even, the paywall for internet apps.
Anyways, I digress (I'm bad about doing that...
).Read the last NPD thread for a lengthy debate about typical June over May growth. Search my username in the thread to get to that point.
June typically sees an increase over May in week for week sales. It's also a 5 week tracking period vs a 4 week. So you're looking at a baseline of at least 25%. The exact number beyond that is up for debate. I think an "in a vacuum" sales rate expectation for the PS4 would be around 300k. Consider the lack of competition and it ought be substantially above that. However, I believe the entire console market is in relatively sharp contraction which means those may be substantial overestimations.
The XBone on the other hand could/should be expected to see nice looking growth relative to May. The announcement of a price cut hurt sales in that month. So you're getting the +25% tracking period, +sales growth from a price cut and finally a larger % growth over the previous month due to its artificially deflated sales for May.
WiiU - damned if I know. It seems to have picked up a lot of momentum following Nintendo's E3 presentation but I've done 0 research into it.
ProfessorMoran
Member
If ms wants to really push the xbone they should bundle the master chief collection for $399. It's time to buy up some market share before it's too late, the Xbox brand has lost a lot of its luster and it's hard to get that back.
Microsoft can afford it but the devision can't and all signs point to Microsoft investors being very upset and calling for the divison to be sold even more if they go back to their strategy of throwing money down a hole just to gain marketshare like the early days of the division.
MrNyarlathotep
Banned
In fairness, the CEO of Ms literally just released a memo describing the importance of the xbox brand to MS.
Yeah but there is a difference in thinking it's an important brand and being willing to throw money down the hole that is never coming back ala bing.
I don't think investors are calling for the division to be sold. Plus the CEO just talked about the importance of Xbox to MS. Keeping a strong brand may be worth the price drop.
Aquamarine
Member
The only thing that statement showed is that Mr. Nadella has yet to modify the existing corporate strategy regarding Xbox.
If Xbox One continues to underperform through Holiday 2014 and into 2015 I assume investors / management will get increasingly intolerant in supporting it.
And Mr. Nadella needs to prove his worth as CEO of Microsoft. If he excessively supports Microsoft's underperforming sectors, people will start to wonder about his ability to effectively reform and orient the company towards growth and profitability.
Yoda
Member
It doesn't change the fact the higher-ups won't approve any capital injections to the division. Investors aren't happy with any segment of Microsoft that dampens the profits of their office/enterprise division. Funneling cash to buy 3rd party exclusives or subsidize the console would be a 9 digit figure which could easily balloon into a 10 digit figure.
spatenfloot
Member
In fairness, what else is he going to say about a major product that launched less than a year ago?
"You know what, guys? Screw Xbox! Have you seen Windows 9?"
If he had any plans to change course with Xbox he would never had mentioned it in his memo at all. Instead he went ahead and talked about its importance.
Mass Effect
Member
Of course they can afford it, but they are probably very unwilling to do that (unless things get really bad) because it would severely hurt their profitability.
Not to mention that I doubt they want to get into a price war with Sony. If MS decides to drop the prices to $399/$299 and Sony reacts by doing the same, then what? They end up right back where they started. It quickly becomes a race to the bottom. And Sony has gone on record saying that the PS4 was designed to be price competitive, meaning if they needed to, they could (and would) drop the price quickly if necessary.
Yoda
Member
The X1 division is profitable; saying it isn't in dire straights is simple denial. They lose more market share in the U.S. to Sony every month that goes by, this is a market they literally dominated all of last gen. Microsoft gave up trying to market the device in most of Europe and "tier 2" countries which leaves the UK, which if I'm not mistaken they are still getting outsold by Sony there too. If they can't get a marketshare foothold anywhere the division is going to generate less profits than the 360 did post RRoD fiasco. There is also the Live subscriptions they will lose to PS+ and the software royalties they will lose due to the PS4 being the defacto system for 3rd party titles. Obtaining marketshare is very important for Microsoft and while it's still early in the cycle, the trend is looking bad for them.
A price war with Sony is easily won. MS can afford take the hit. Sony can not. Remember the games division is not making a profit for Sony as is.
Aquamarine
Member
Mr. Nadella made that statement to clarify he wasn't changing anything at the moment.
That's what new CEOs do. As new management, they have to clarify their position on the various sectors in the company. Obviously they're going to call every area that they continue to invest a bunch of money in "important."
Doesn't mean Mr. Nadella won't react to a reality where Xbox One consistently underperforms.
"At the moment" Xbox is an important brand to the company.
Yoda
Member
The X1 division would still have to go into the red to accomplish that, something Microsoft won't do.
If they could afford to take the hit, why did they use ddr3 and not go balls to the wall with specs for the system and still sell it at $499?
They would have lost some money with every console sold, but less than they would lose if they started to sell at $299
Why? They do it all the time. Sony is in the red with the PS4 as well and they have to where near the cash as MS.
Edit: ^^^^^^^^^^^^^^ Xbox just started being profitable so that wouldn't be good. There are also many signs that this is a shrinking market.
[360] 70k
[3DS] 150k
[PS3] 50k
[PS4] 260k
[WIU] 100k
[XB1] 190k
I tried to use math, but my gut feeling kept modifying the numbers. I am hoping Vita is above 20k considering the stock situation. That would mean there is some demand :/
[360] 70k
[3DS] 150k
[PS3] 50k
[PS4] 260k
[WIU] 100k
[XB1] 190k
I tried to use math, but my gut feeling kept modifying the numbers. I am hoping Vita is above 20k considering the stock situation. That would mean there is some demand :/
Just because they can afford to make a hit doesn't mean they don't want to make a profit.
spatenfloot
Member
Microsoft can. The Xbox division can't. Shareholders won't let companies continually throw money down a black hole. Money losing divisions get cut or reorganized.
Yoda
Member
Most analysts believe the console market is going to contract. What is the purpose of investing billions of dollars to subsidize a console to gain market share if said market isn't believe to be growing? There is also the point Aqua is marking. Nandella didn't get brought on to simply continue the floundering management of Ballmer. If a segment is not only under-performing but actually taking profits from other segments of the company there will be an expectation of him to get rid of the division in some fashion.
Then the game division for Sony is in big trouble with shareholders then.
spatenfloot
Member
No, I believe the losses were from Sony Online Entertainment. PlayStation is one of their only good deal divisions right now.
The game division is in the red and had been for awhile. Their only good division is insurance.
Imru al-Qays
Banned
Yes, but his point was that the PlayStation part of the game division hasn't been in the red.
The PS3 is one reason why Sony is in big trouble. MS would be smart not to attempt the same if the XB1 won't sell.
Edit: Sad about Sony Online Entertainment. Planetside 2 is a great game.
Yoda
Member
If you don't count R&D the Playstation brand is in the black. The last FY report had a lot of accounting tricks to shift all the bad news out the door now rather than later but it's a moot point to be honest. Neither company wants to subsidize their consoles similar to how it was done in previous generation because it's bad business.
Aquamarine
Member
Well, Sony and Microsoft are two very different companies with different management and different expectations for short-term profits.
I expect Sony, as a Japanese company with lots of domestic investors, to be more lenient with short-term losses, prioritising growth over the long-term.
The general sentiment at Microsoft seems to be less tolerant of under-performing segments.
Surely a MCC bundle at $399 is inevitable? Even so, I can't see it really kicking sales into high gear. Halo is too close to the core Xbox market so I'd expect a lot of the existing HW userbase to buy the game but not for it to drive many new HW sales.
It has been sold in most of those for quite some time. Tons of XB1 consoles available in Norway right now .
spatenfloot
Member
How could you know that?
They project a tiny profit. Which would be in the red if they tried to match any price drop from MS. We will see if the projection is correct soon.
I think it is more likely they'll try and innovate on the entertainment side (which would also be cheaper and not require heavy investment). Eg opening the windows App Store on Xbox one to bring more entertainment and information apps to the living room; and Cortana is surely inevitable? That would also be wanted to counter whatever Apple might do with Apple TV.
A living room box with TV pass through, that you can talk to naturally (cortana > Kinect voice recognition), and can surface more than just game related info, could be pretty compelling. And yes, I realise that might not be so interesting to the gaming forum
The game division was minimally in the red in year where they launched a new console. When historically they were much further in the red at launch with other console launches despite the PS1 and PS2 having much healther sales in their twilight years then the PS3 is showing now. So essentially the news is good for the games division projecting forward.
Imru al-Qays
Banned
The first year of any console generation is always the diciest. There are tons of one-off costs and the install base needs time to grow in order to ramp up software licensing and subscription revenues. If the PlayStation division is already making a profit so early in the game it's pretty well-situated for the long term.
Imru al-Qays
Banned
A living room box with TV pass through, that you can talk to naturally (cortana > Kinect voice recognition), and can surface more than just game related info, could be pretty compelling. And yes, I realise that might not be so interesting to the gaming forum
The problem, though, is that the Xbone is priced like a gaming console, not a Netflix box.
spatenfloot
Member
Don't forget:
Kaz Hirai: "PS4 hardware is already profitable"
http://m.neogaf.com/showthread.php?t=823567
And
Sony CEO Believes PS4 Will be More Profitable Than PS2
http://m.neogaf.com/showthread.php?t=826459
Kaz Hirai: "PS4 hardware is already profitable"
http://m.neogaf.com/showthread.php?t=823567
And
Sony CEO Believes PS4 Will be More Profitable Than PS2
http://m.neogaf.com/showthread.php?t=826459
Am I the only one who looks at that chalkboard and thinks that the only thing MS are truly praying for this year is that of the probable 6m people minimum looking to buy a console go into a store and find everywhere sold out again for PS4 so pick up an XB1 instead?
For me this xmas will be the make or break all of the machines.
For me this xmas will be the make or break all of the machines.
Yoda
Member
I think it is more likely they'll try and innovate on the entertainment side (which would also be cheaper and not require heavy investment). Eg opening the windows App Store on Xbox one to bring more entertainment and information apps to the living room; and Cortana is surely inevitable? That would also be wanted to counter whatever Apple might do with Apple TV.
A living room box with TV pass through, that you can talk to naturally (cortana > Kinect voice recognition), and can surface more than just game related info, could be pretty compelling. And yes, I realise that might not be so interesting to the gaming forum
The problem with competing with Apple TV is the price-point. Apple TV is $310 cheaper, the Xbox would have a very tough time trying to justify it's higher price-point to a consumer who as you said probably isn't interested in games. The more realistic strategy to counter Apple/Google for a living room device would be to simply make a different device in the same vein as the Playstation TV, with reduced functionality but a much softer price-point.
ProfessorMoran
Member
The bundle is for playing keep away, they have to try to retain existing xbl users who don't have xbone to move them to the xbone instead of being poached by the PS4. They're already on the defensive, stop the bleeding first.