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[jedimike]

Perfect Dark Zero... maybe. Kameo? Doubtful. If you mean million across all territories, I'll give you that, but definitely not here in the US.

Kameo will easily do a mil in the US... it's MS's Luigi's Mansion. It will sell well throughout it's lifetime, especially with all of the upcoming marketplace downloads.

 

[kaching]

Obviously, someone at MS, and probably more than just one person, expects the console division to be profitable at some point or they simply wouldn't even be in the biz.

Do they, necessarily? The concern for MS is that the company overall be profitable, specific divisions don't have to be profitable to achieve that end. Cringely put it best:

Until the last two to three years, Microsoft was able to keep its stock price continually climbing and stock splits coming by steadily increasing earnings per share. Every quarter Microsoft beat analyst profit expectations and the stock went up and up and up as a result. Lately that hasn't been the case, not because profits haven't been good but because of Microsoft's legal problems. In the long run, though, things might return to what Microsoft used to consider "normal,” so Ballmer and others continue to manage for steadily increasing earnings. Now most companies increase earnings by pushing sales, sometimes at the expense of the following quarter and Microsoft may do some of that from time to time. But the other way they manage earnings is through their simple ability to stop wasting money. Rather than boosting earnings, Microsoft manages expenses. As part of this technique, they've even been accused of accounting irregularities that pushed earnings DOWN, not boosted them, like just about very other company with accounting problems.

Here's how earnings management works. When Bob Scranton and I took a bowling class a million years ago at the College of Wooster, there were two girls in the class who didn't bowl nearly as well as we did, but they got a better grade at the end of the term. They did this by deliberately doing poorly at first, then got slowly better through the term, while Bob and I just stupidly bowled our hearts out right from the start. Our scores were always better, but their scores dramatically improved and ours didn't. The teacher (imagine a bowling teacher -- now there's a concept) graded on improvement. And so, historically, does Wall Street.

Microsoft is so incredibly profitable that it can carry all those losing businesses along quite deliberately, knowing that at any time they can be shut down or trimmed back and the money that might have been spent converted instantly and precisely into profit. If Microsoft simply shut down all its money losers, sales would shrink by about 20 percent, but profits would double. And Wall Street would love it. But then what do you do next year? That's why Microsoft does business this way. It's better to grow earnings by 15 to 25 percent per year for several years than to show all the growth at once. And absent the accounting gimmicks, since dealt with by a consent decree and a few changes in the way Microsoft accounts for this and that, all this is perfectly legal. There is nothing wrong with overspending.

http://www.pbs.org/cringely/pulpit/pulpit20031113.html

 

[DarkMage619]

Are we to assume the X360 will never become cheaper over the lifetime of the console and become profitable for M$ to make? If you look at the 360, M$ has taken a number of steps to ensure that the cost of the console scales downward as time goes on. If the 360 will never be profitable for M$ what does that say for Son¥ and PS3 which has even more hardware features and a brand new and expensive Blu-Ray Drive?

I also had a question about the losses M$ has taken in the previous generation. How much of that money was spent on brand building. When I say that I mean creating a new console brand that has no previous history, getting developer support, R&Ding the console itself, manufacturing costs, shipping, and marketing. The losses need to be taken in context with what they were doing. Think of how much more they would lose after spending all of that time and effort in building a brand to abandon it because it was expensive. That would be the LAST thing they'd want to do.

Anyway the 360 has been out less than 3 full months, just because they aren't selling the 360 at a profit today doesn't mean they never will and its WAAAAAY too early to question whether or not M$ will be in the industry next gen. Bill Gates already said they'd want to create a new console next gen after 360 so I don't know how ANYONE can doubt whether or not M$ is in this for the long run.

The Dark One

 

[Spider_Jerusalem]

I know Microsoft is a rich company and doesnt have to worry about these losses. But still, it'd be pretty pointless to enter a market if you cant make any money from it.

A little tale about Microsoft: 9 years ago, they decided to enter the handeld market, going aginst the market ruler at that time, Palm. For 9 years they went on trying and trying with several iterations of their system (Win CE, Pocket PC, Win Mobile), *alway at loss*. The last quarter, after 9 years, they made the first moneys in that market. And they've managed to become the markete leaders: heck, eve Palm now uses Windows Mobile!

Little losses in some areas are nothing for them and their investors, while MS continues to be highly profitable.

 

[qirex]

A little tale about Microsoft: 9 years ago, they decided to enter the handeld market, going aginst the market ruler at that time, Palm. For 9 years they went on trying and trying with several iterations of their system (Win CE, Pocket PC, Win Mobile), *alway at loss*. The last quarter, after 9 years, they made the first moneys in that market. And they've managed to become the markete leaders: heck, eve Palm now uses Windows Mobile!

Yeah but Palm basically handed them that market by doing almost no OS development for 4 years and reorganizing/splitting/remerging the company tons of times. Besides, just because it's turning a profit now doesn't mean it's made back what it took to get there. Microsoft isn't going away any time soon but they're not an invincible juggernaut anymore either. Plus they've told their investors the 350 will be consistently profitable by FY2007.

 

[blazinglazers]

Yeah but Nintendo/Sony basically handed them that market by doing almost no online gaming / infrastructure development for 4 years and instead focusing on handhelds.

hypothetical fix. kinda stupid I know, but it's possible to see parallels.

 

[zou]

I think they'd probably be making money on xbox now if they hadnt decided to jump to 360 so quickly.

Not really. Every single console they sold, they lost money on, since they got screwed by both nVidia & Intel (which didn't pass "savings" along, unlike now, where MS will profit as soon as yield improves and/or they can shrink the gpu/cpu/die)

I need confirmation on those PD0 numbers. I doubt 300,000 sales has generated $12 million.

Sony has been in some financial trouble for awhile now. If the PS3 fails, they'll be in even more trouble. I'm not saying it will fail of course.

300,000 * 40$ (that's approx. the wholesale price).

 

[quetz67]

A little tale about Microsoft: 9 years ago, they decided to enter the handeld market, going aginst the market ruler at that time, Palm. For 9 years they went on trying and trying with several iterations of their system (Win CE, Pocket PC, Win Mobile), *alway at loss*. The last quarter, after 9 years, they made the first moneys in that market. And they've managed to become the markete leaders: heck, eve Palm now uses Windows Mobile!

Little losses in some areas are nothing for them and their investors, while MS continues to be highly profitable.

Nice story and true of course, still it doesnt mean it will work in the video games market too.

I think it might work, but it may take longer than the 15 years the projected for being #1.

One problem is Japan, even trying their best they only got worse numbers and it wont change. US and europe arent that bad but until now they are off for a slow start, and with a probably technically slightly inferior machine it will hard to gain speed.

And there are two more problems called Sony and Nintendo. Nintendo, even if not the main comptetitor, refuses to leave the hardware market and will at least take some marketshare away.

Problem #1 is Sony of course. The scenarios are:

1. Xbox 360 does quite good, maybe even better than PS3 (although extremely unlikely). In this case Sony will start a price war making the xbox 360 unprofitable again.

2. Xbox 360 does pretty bad. Then MS will start a price war, again killing off all profits.

I know MS have the money to fight the war, but even if they double marketshare this gen the next gen will make no difference, Sony will fight with all means, which probably just means less profits for all.

And if MS isnt market leader after 3 gens and still makes no profits, they might just give up. They might as well not and still fight another 3 gens, I just dont believe it.

 

[I <3 Katamari]

Kameo will easily do a mil in the US... it's MS's Luigi's Mansion. It will sell well throughout it's lifetime, especially with all of the upcoming marketplace downloads.

lol, no. It definitely isn't.

 

[monkeymagic]

A little tale about Microsoft: 9 years ago, they decided to enter the handeld market, going aginst the market ruler at that time, Palm. For 9 years they went on trying and trying with several iterations of their system (Win CE, Pocket PC, Win Mobile), *alway at loss*. The last quarter, after 9 years, they made the first moneys in that market. And they've managed to become the markete leaders: heck, eve Palm now uses Windows Mobile!

Little losses in some areas are nothing for them and their investors, while MS continues to be highly profitable.

A decade for success in a market with weak competitors - Palm were leaders by default in that market just as MS became leaders in the OS market by default because of the incompetence of other players at the time or just being there first.

Sony and Nintendo are far from incompetent - both making huge profits from different sectors of the same market and with differing strategies.

You don't need to be brand leader to make a profit in this market as Nintendo has shown. You don't have to be the world's largest company to be the brand leader in this market as Sony has shown.

Unfortunately for MS, they don't get that - they can throw billions at it but when you have people like Peter Moore and Allard in charge of where that money goes you're not going to get very far.

Let's not forget that for every success MS has had (no matter how minor that success may be or that it may have taken a decade) there have been many many more failures - XBox being one of them.

 

[zou]

Problem #1 is Sony of course. The scenarios are:

1. Xbox 360 does quite good, maybe even better than PS3 (although extremely unlikely). In this case Sony will start a price war making the xbox 360 unprofitable again.

2. Xbox 360 does pretty bad. Then MS will start a price war, again killing off all profits.

I know MS have the money to fight the war, but even if they double marketshare this gen the next gen will make no difference, Sony will fight with all means, which probably just means less profits for all.

And if MS isnt market leader after 3 gens and still makes no profits, they might just give up. They might as well not and still fight another 3 gens, I just dont believe it.

1) Uhm, no. Sony can subsidize their PS3, I give you that, but in NO way can they last a price war. Hell, there is now way they would START one. Plus they have no reason to do so. MS on the other hand might just do that, and screw up Sonys plan, they got a) the motivation and b) the money

2) Likely, but I doubt it will "kill" off all their profits. By the time PS3 launches they most likely got their Yields up & optimized their assembly, external components went down in price, so while cutting the price of the X360, they certainly wouldn't lose a lot more than what they are/were losing.

 

[jett]

Probably not.

 

[monkeymagic]

1) Uhm, no. Sony can subsidize their PS3, I give you that, but in NO way can they last a price war. Hell, there is now way they would START one. MS on the other hand might just do that, and screw up Sonys plan, they got a) the motivation and b) the money

Sony's projections for their Playstation products are 10 years not 4 years like MS.

They can outlast MS easily - their revenue from BR licenses alone will eclipse MS' game revenue yearly. Add to that revenue from games, music, and connect downloads on an install base that will likely be 4-5x that of X360 and whether they can outlast MS in a price war is really a null question.

 

[zou]

Sony's projections for their Playstation products are 10 years not 4 years like MS.

They can outlast MS easily - their revenue from BR licenses alone will eclipse MS' game revenue yearly. Add to that revenue from games, music, and connect downloads on an install base that will likely be 4-5x that of X360 and whether they can outlast MS in a price war is really a null question.

Yeah, except speculating about things that might or not happen in 2 years is kind of pointless.

Fact is, if Sony launches their PS3 this fall/spring, they'll subsidize it quite a lot. More so than MS (that should be a no-brainer). And if any of the previous consoles are an indicator, they'll sell like hot cake, and many times better than the 360. Especially looking at what they are doing right now with the PS2, it would make no sense for them to take they money they made, and drop the price of something that just started to be profitable, considering they still got "some" debt to pay off.

If we'll see a price war, it'll get started by MS, and I wouldn't be too sure if Sony follows suite.

 

[qirex]

hypothetical fix. kinda stupid I know, but it's possible to see parallels.

It would be if handhelds weren't doing incredibly well now.

Also, both Sony and Nintendo have online plans for their next systems. It's not like the functionality of Live is some amazing special jewel that no one could ever reproduce. It's well implemented for sure but it's not like it took them billions of dollars to develop it. Plus there's still the fact that unless you're an 13-25 male having other 13-25 males yell racial and sexual slurs at you, blast Insane Clown Posse or drone on about how high they are isn't a good consumer experience. Live is a great technical solution and a crappy social and community one.

Especially looking at what they are doing right now with the PS2, it would make no sense for them to take they money they made, and drop the price of something that just started to be profitable, considering they still got "some" debt to pay off.

Are you serious? Pleas post a link to your source because i was operating under the impression that the PS2 has been insanely profitable ever since the first year it was out.

 

[monkeymagic]

Yeah, except speculating about things that might or not happen in 2 years is kind of pointless.

No that is exactly the point of projections.

These companies don't make strategic decisions based on last months NPDs.

We're talking billions of dollars at stake here and you can bet Sony has factored the projected revenue from BR licenses, games, music, movies, Connect downloads for the next 10 years into PS3's pricing strategy.

If we'll see a price war, it'll get started by MS, and I wouldn't be too sure if Sony follows suite.

Of course anyone can start cutting the price of their products - but if their competitors don't follow suit then it isn't a price war.

I doubt Sony would enter into a price war with MS not because they can't but because they don't need to - PS3 will outsell X360 even if it is $100 more expensive.

I suspect PS2 will outsell it too for the rest of the year should Sony drop the price.

 

[xsarien]

Yeah but Palm basically handed them that market by doing almost no OS development for 4 years and reorganizing/splitting/remerging the company tons of times. Besides, just because it's turning a profit now doesn't mean it's made back what it took to get there. Microsoft isn't going away any time soon but they're not an invincible juggernaut anymore either. Plus they've told their investors the 350 will be consistently profitable by FY2007.

Also: The WinCE/Mobile losses weren't anywhere near the XBox losses. Comparing Microsoft's performance with Software Package Y with Hardware Z isn't exactly the best way to look at it.

You need to look at how much they pushed Ultimate TV and WebTV before basically conceding those markets.

 

[Piper Az]

No that is exactly the point of projections.

These companies don't make strategic decisions based on last months NPDs.

We're talking billions of dollars at stake here and you can bet Sony has factored the projected revenue from BR licenses, games, music, movies, Connect downloads for the next 10 years into PS3's pricing strategy.



Of course anyone can start cutting the price of their products - but if their competitors don't follow suit then it isn't a price war.

I doubt Sony would enter into a price war with MS not because they can't but because they don't need to - PS3 will outsell X360 even if it is $100 more expensive.

I suspect PS2 will outsell it too for the rest of the year should Sony drop the price.

Uhhh, right... But your argument has serious flaws - assumptions of 1) Sony actually making significant money from their other businesses (e.g. movies, music). BR licenses are likely to come but in a few yrs. Their music and movie companies are gasping for good profit, and their Connect downloads? Pleaze...dude. 2) MS does other things than selling Xbox360s. Heard of Windows and servers?

When it comes to cash, M$, whether you like it or not, can crush Sony like a tin can.

 

[Dave Long]

Kameo will easily do a mil in the US... it's MS's Luigi's Mansion. It will sell well throughout it's lifetime, especially with all of the upcoming marketplace downloads.

That would be fine if there were a market for a game like Kameo on Xbox, but there just isn't. The people who buy the 360 do not want to be a little girl inside a fantasy creature's body and the only way a game like this sells is to find a new group of users. Unfortunately, they show absolutely no sign of enticing that market to buy their system.

Just look at launch title sales if you need a sign. This game just doesn't appeal to the 360 userbase and even with time, it's highly unlikely it will get to a million in sales.

 

[Wulfer]

When it comes to cash, M$, whether you like it or not, can crush Sony like a tin can.

This is why Sony will avoid a price war with M$ at all cost. Sony won't go this route until it has no choice aka M$ starts out selling PS3 2 to 1 or more. Then Sony will try to slide down the slippery slope with it's butt dragging the ground to try and stop the red ink from flowing. It's really quite interesting, I wonder how far will M$ try to push down the price to try and put Sony in the stranglehold?

 

[jedimike]

One problem is Japan, even trying their best they only got worse numbers and it wont change. US and europe arent that bad but until now they are off for a slow start, and with a probably technically slightly inferior machine it will hard to gain speed.

The path to #1 does not lie in Japan. Take the PS2 out of Japan and PS2 is still the #1 selling console. Japanese developers will still make games because they know that the Western market is so huge.

1. Xbox 360 does quite good, maybe even better than PS3 (although extremely unlikely). In this case Sony will start a price war making the xbox 360 unprofitable again.

Come on now... I'm not an economics major, but I don't think it takes one to figure out the the company with the most revenue and assets wins a price war. Sony can not possibly compete.

2. Xbox 360 does pretty bad. Then MS will start a price war, again killing off all profits.

I know MS have the money to fight the war, but even if they double marketshare this gen the next gen will make no difference, Sony will fight with all means, which probably just means less profits for all.

Less profits means price war... MS still wins.

And if MS isnt market leader after 3 gens and still makes no profits, they might just give up. They might as well not and still fight another 3 gens, I just dont believe it.

I think that if Xbox 3 does not work for MS, then they will find a way to still be involved with the business. Licensing out development tools, etc.

You need to look at how much they pushed Ultimate TV and WebTV before basically conceding those markets.

They never conceded. Now they just sell the software to cable companies. I know that my Comcast HD-DVR uses a Microsoft OS.

That would be fine if there were a market for a game like Kameo on Xbox, but there just isn't. The people who buy the 360 do not want to be a little girl inside a fantasy creature's body and the only way a game like this sells is to find a new group of users. Unfortunately, they show absolutely no sign of enticing that market to buy their system.

Granted, launch owners for GameCube and 360 are not from the same demographic... however, once the system hits mainstream, there will be a market for Kameo. It's just that Luigi's Mansion was the best Gamecube available at launch, the same can not be said for Kameo, at least not at $60.

... but once it hits Greatest Hit status, I expect a lot of sales. Mark this thread and then you can call me on it when Xbox 3 arrives.

 

[xsarien]

They never conceded. Now they just sell the software to cable companies. I know that my Comcast HD-DVR uses a Microsoft OS.

Yes, but it's not a UTV box. Not only that, but I'd put actual money down that Microsoft, should they ever get their OS on a major console, would kill the XBox faster than you can say "Blinx."

 

[Guileless]

Plus there's still the fact that unless you're an 13-25 male having other 13-25 males yell racial and sexual slurs at you, blast Insane Clown Posse or drone on about how high they are isn't a good consumer experience. .

:lol :lol :lol
It's funny because it's true.

 

[monkeymagic]

Uhhh, right... But your argument has serious flaws - assumptions of 1) Sony actually making significant money from their other businesses (e.g. movies, music). BR licenses are likely to come but in a few yrs. Their music and movie companies are gasping for good profit, and their Connect downloads?.

1. BR licenses are paid up front - and again it doesn't matter if they come in a few year or 10 years - as long as they come in that timeline they will be factored into PS3's price.

2. Gasping for profit? You probably don't understand the movie and music business but the majority of the profits from any particular title come many months after theatrical/MTV release. DVD, UMD, Blu-Ray and Connect sales are going to fatten the bottom line very nicely.

3. Connect hasn't been released. If you think MS is making good money from XBL arcade (which it does and will continue to do so) and Apple makes good profits from iTunes store then you won't be able to imagine the profits to be taken from the redistribution of content in digital form by the content owner AND content distributor to a userbase of 100M+.

2) MS does other things than selling Xbox360s. Heard of Windows and servers? .

Irrelevant.

If we're going to take the stance that MS is the cash king (which in itself is an irrelevance as they've proven) then where they make that money isn't of concern.

How are Windows Server sales going to help X360 sales and their entertainment division's bottom line?

The answer is they aren't.

When it comes to cash, M$, whether you like it or not, can crush Sony like a tin can.

Again, cash really means nothing especially in this industry.

As MS has proven.

 

[SolidSnakex]

lus there's still the fact that unless you're an 13-25 male having other 13-25 males yell racial and sexual slurs at you, blast Insane Clown Posse or drone on about how high they are isn't a good consumer experience.

I could deal with the other stuff, but ICP? People sitll listen to them?

 

[Dave Long]

Granted, launch owners for GameCube and 360 are not from the same demographic... however, once the system hits mainstream, there will be a market for Kameo. It's just that Luigi's Mansion was the best Gamecube available at launch, the same can not be said for Kameo, at least not at $60.

... but once it hits Greatest Hit status, I expect a lot of sales. Mark this thread and then you can call me on it when Xbox 3 arrives.

Thread saved!

I just don't see it. The Xbox demographic never changed appreciably from early adoption through its abbreviated lifetime of four years. (And let's be honest here... it's pretty much over on the Xbox now.) Games like Grabbed by the Ghoulies and Voodoo Vince and Blinx were supposed to bring that mainstream market something to play and all of them tanked. Kameo, while probably being a better game than those three, isn't going to find an audience on the 360.

To be honest, I think the 360 demographic is skewing even more toward "adult" entertainment options and even further away from something that families, kids and/or mainstream people are going to be interested in. It's near impossible for me to convince people to get the thing online who have already bought one and the games they're playing are all typical Xbox fare like PGR3 and Call of Duty 2.

Microsoft has a real problem with the appeal of their console products and games like Kameo aren't helping change the perception or influencing the sales and demographics of their box.

I mean, I've heard what you say for the last three years about the original Xbox and yet they never made more than a dent into the mainstream gamer group and even when they did, the things that sold were first person shooters.

 

[monkeymagic]

All those who are saying MS will squeeze Sony with a price war must have missed the last generation.

Where was the price war?

Or did MS just not 'try' last time round? :lol

As I said before can't have a price war if your competitor doesn't need to enter into it especially so if your console is being slaughtered month after month in sales worldwide and poses little or no threat to said competitors.

See XBox vs PS2 if you're still not sure.

 

[Kojiro]

MS are in the industry becase of the love of it.

:lol :lol

 

[Jiggy]

This isn't a Microsoft bashing thread. I like the fact that they are in this industry. More competition means better games and lower prices.

Thus the $60 X360 games, the (good version of the) 360 costing $100 more than its predecessor, and the PS3 slated to cost at least $100 more than the PS2.

 

[Last Hope]

I doubt off the Xbox itself but if they can sell enough crap to you over the Xbox and rip off enough people with their overpriced accessoies and crap like the retard pack, then maybe they stand a chance. MS does not manufacture anything so they are paying the middleman for all the hardware they come out with. Sony does not. Nintendo just works out good deals. Also, looking at MS financials, they have never ever made a profit off hardware. If it was not for Windows and Office, MS would be a terrible failure as a company.

 

[Piper Az]

1. BR licenses are paid up front - and again it doesn't matter if they come in a few year or 10 years - as long as they come in that timeline they will be factored into PS3's price.

BRD will bring in money, but it's not going to bring in cashload as you put it until a few yrs because of the format war.

2. Gasping for profit? You probably don't understand the movie and music business but the majority of the profits from any particular title come many months after theatrical/MTV release. DVD, UMD, Blu-Ray and Connect sales are going to fatten the bottom line very nicely.

I may not understand the movie and music business but apparently a lot more than you do. As far I as I know Sony's film division had a operating cost of 3 million dollars last quarter - and this includes everything (i.e. DVD UMD stuff that you mentioned). Their music division fared better with ~$150 million

3. Connect hasn't been released. If you think MS is making good money from XBL arcade (which it does and will continue to do so) and Apple makes good profits from iTunes store then you won't be able to imagine the profits to be taken from the redistribution of content in digital form by the content owner AND content distributor to a userbase of 100M+.

It's possible, but I don't think Sony will fare a lot better than MS in this regard.

Irrelevant.

If we're going to take the stance that MS is the cash king (which in itself is an irrelevance as they've proven) then where they make that money isn't of concern.

How are Windows Server sales going to help X360 sales and their entertainment division's bottom line?

The answer is they aren't.

prove what? You've stated nothing but your opinion in an attempt to "prove" things. Everyone agrees that Sony is in the middle of restructuring due to profit drag. Its gaming division is the only bright operation they've got. The point is, I disagree with your post saying MS can't last long, or that they can't afford a price war. They make much more money than Sony - and yes, this is pretty relevant - and they can stay in the market as long as they see it fit in their businees plan. Plus, they're not simply pumping in the money - they actually make decent business decisions to expand their market share.

Again, cash really means nothing especially in this industry.

As MS has proven.

And as Sega, Atari, and SNK and all the other failed companies have showed that your argument is flawed. While I agree that no money can save a failing venture, I think you are wrong in assuming that all MS has got in their hands is money and money only. The Xbox brand is strong, and it has become the formidable force against Sony's Playstation - worldwide, minus Japan, of course.

 

[quetz67]

The path to #1 does not lie in Japan. Take the PS2 out of Japan and PS2 is still the #1 selling console. Japanese developers will still make games because they know that the Western market is so huge.

I dont know if the path lies in Japan, but not selling there makes it a lot harder to be #1

Come on now... I'm not an economics major, but I don't think it takes one to figure out the the company with the most revenue and assets wins a price war. Sony can not possibly compete. Less profits means price war... MS still wins.

You dont need multi-billion in assets to win a console price war, there is no winner anyway. But if both consoles would be at a very low price it would probably still the PS3 that sells better.

I think that if Xbox 3 does not work for MS, then they will find a way to still be involved with the business. Licensing out development tools, etc..

Of course they would be. MS makes lot of money with games, wouldnt it be great for them not to lose that money and more just because of their stupid plan to invade our living rooms? Their inital plan to make xbox the ultimate Media Center/HD Recorder has already failed anyway.

 

[monkeymagic]

It's possible, but I don't think Sony will fare a lot better than MS in this regard.

So you think Sony will fare only slightly better with a userbase at least double the size and offering their own game, movie and music content as opposed to MS offering XBL arcade games to a smaller userbase and maybe acting as middlemen for other content providers?

The money is in owning the distribution and owning the content. MS' distribution base will be no larger than 30M and of course they own absolutely no music or movie content.

The point is, I disagree with your post saying MS can't last long, or that they can't afford a price war.

I think you misread me. I never said anything about MS not being able to last long or afford a price war.

What I commented on was your assertion that Sony couldn't afford a price war but I put it to you any price war MS starts will be with themselves because both Sony and Nintendo will ignore them as they did this gen.

Because of this there will be no price war - it will simply be MS slashing their prices which will no doubt look like desperation from retailers and consumers alike.

The Xbox brand is strong, and it has become the formidable force against Sony's Playstation - worldwide, minus Japan, of course.

XBox is a brand - nothing more.

A strong brand is Sony, Apple, Nintendo - brands that sell to tens of millions of consumers on their name alone without throwing billions at them to build a fleeting userbase.

XBox barely reached 20M users last gen - anything but a strong brand.

As of now XBox is not 'a formidable force against Sony's Playstation worldwide minus Japan' - there is the US, the US and the US.

And even that is arguable considering both XBox consoles are being outsold by Sony's 6 year old PS2 there.

 

[JavyOO7]

They'll make profits eventually. If not on Xbox360 then Xbox3 or whatever they decide to call it.

 

[SolidSnakex]

The Xbox brand is strong, and it has become the formidable force against Sony's Playstation - worldwide, minus Japan, of course.

I sitll don't get this, in the US I under stand, but worldwide with the exception of Japan? Over 50% of the Xbox's hardware sales came from the US. It didn't do very well in Europe at all, and the PS2 actually outsold it by a wider margin there than it did in Japan.

 

[jedimike]

Of course they would be. MS makes lot of money with games, wouldnt it be great for them not to lose that money and more just because of their stupid plan to invade our living rooms?

Last time I checked MS isn't losing money... and yes, I would be sad if they did because I have had a lot of fun gaming on Xbox and 360. And it's not just MS's stupid plan to invade the living room. It's also Sony's, Toshibas, Comcasts, Warner Bros., any company that has you in the living room watching, viewing, or playing their product is in a fight for your dollars. Why would I be mad at MS for wanting my living room? It's like being mad at Mitsubishi for making cars and electronics.

Their inital plan to make xbox the ultimate Media Center/HD Recorder has already failed anyway.

The initial plan is a 15 year plan. Here we are at year 5 and MS is much closer to their goal with the Xbox brand then they were at year 1. Using the 360 as a Media Center extender is a very good multimedia HD device.

 

[DarkMage619]

XBox is a brand - nothing more.

A strong brand is Sony, Apple, Nintendo - brands that sell to tens of millions of consumers on their name alone without throwing billions at them to build a fleeting userbase.

XBox barely reached 20M users last gen - anything but a strong brand.

As of now XBox is not 'a formidable force against Sony's Playstation worldwide minus Japan' - there is the US, the US and the US.

And even that is arguable considering both XBox consoles are being outsold by Sony's 6 year old PS2 there.

How old are the Nintendo, SON¥ and Apple brands? Those companies spent decades (and billions of dollars over the years BTW) building up their brands from obsurity to household names. Rome wasn't built in a day and the XBOX name won't be popular overnight. I do think it is quite funny that you dismiss the 20 million XBOX units sold when the XBOX as a brand isn't even 5 years old yet! And it managed to garner those sales in a hostile games market with 2 MUCH older and well established competitiors. It even outsold one of those competitors although no one here would admit that. SON¥ had the industy handed to them by Sega and Nintendo and Nintendo WAS the industry for a long time. OF COURSE it took billions for the XBOX to get anywhere, look who they were up against.

You also appear to be dismissing the US as it isn't the largest and most important market in the industy. Right now the biggest and best selling titles come from the US, the biggest publisher resides in the US, and the country that seems to be willing to spend the most on game entertainment are from the US so saying the XBOX did well in the US is IMPORTANT! Japan was NEVER going to see XBOX as anything more than a joke, it doesn't matter what games they have on their platform. And M$ made some serious mistakes with pricing in Europe so they fumbled up right from the start. We'll see how things work out this gen.

Your comments about the PS2 outselling XBOX and the 360 are laughable because in both cases I'd say M$ is more responsible for the sales difference over anything SON¥ has done. The 360 has issues with distribution and the original XBOX is no longer supported by M$ wow way to go SON¥!! Not saying that SON¥'s sucess last generation, longer time in the market, and larger game library didn't have anything to do with their success but you have to admit that much of PlayStation brand was built up just because it had little or no real comptition until M$ came along. What will be truly interesting is to see just how much developers will be willing to start from ground zero supporting the PS3 with no installed base over the 360 which should have a sizable base by the time the PS3 hits. Of couse the exception here is Japan, but as I've already mentioned the 360 NEVER had a chance there, and luckily they aren't nearly important as they once were.

The Dark One

 

[Piper Az]

So you think Sony will fare only slightly better with a userbase at least double the size and offering their own game, movie and music content as opposed to MS offering XBL arcade games to a smaller userbase and maybe acting as middlemen for other content providers?

The money is in owning the distribution and owning the content. MS' distribution base will be no larger than 30M and of course they own absolutely no music or movie content.

And you know this how? Stop posting non-facts as facts.

I think you misread me. I never said anything about MS not being able to last long or afford a price war.

What I commented on was your assertion that Sony couldn't afford a price war but I put it to you any price war MS starts will be with themselves because both Sony and Nintendo will ignore them as they did this gen.

Because of this there will be no price war - it will simply be MS slashing their prices which will no doubt look like desperation from retailers and consumers alike.

This is true, but the reverse can be said the same.

XBox is a brand - nothing more.

A strong brand is Sony, Apple, Nintendo - brands that sell to tens of millions of consumers on their name alone without throwing billions at them to build a fleeting userbase.

XBox barely reached 20M users last gen - anything but a strong brand.

As of now XBox is not 'a formidable force against Sony's Playstation worldwide minus Japan' - there is the US, the US and the US.

And even that is arguable considering both XBox consoles are being outsold by Sony's 6 year old PS2 there.

Xbox is a well-known brand now, imo. When I start reading mainstream (NY Times, BBC, MTV) media terming videogames as "Xbox", I say this is a fair reasoning. And Xbox, when it launched, was a new brand, so there's nothing wrong with MS spending money in marketing to push its name. Besides, you make it sound like Sony and Nintendo do minimal marketing - tell me the same when PS3 launches. And fleeting userbase? I disagree. Plus, you contradicted yourself by naming Nintendo; it's probably the most well known videogame company in the world, but your reasoning again fails because the Gamecube actually lagged behind the Xbox. And yes, I agree that the Xbox's dominant market is the US.

 

[monkeymagic]

M$...SON¥...

I might read that when you learn to type MS and Sony correctly.

 

[monkeymagic]

Gamecube actually lagged behind the Xbox.

Gamecube will outsell XBox when all is said and done.

And I wasn't confining those brands to the console industry (hence the mention of Apple) - Nintendo is a strong brand in the handheld industry.

 

[_Angelus_]

Does it really matter? Without both of them we wouldn't be seeing such a competitive war going on.

Learn to love them both already.

 

[puebla]

How old are the Nintendo, SON¥ and Apple brands? Those companies spent decades (and billions of dollars over the years BTW) building up their brands from obsurity to household names. Rome wasn't built in a day and the XBOX name won't be popular overnight. I do think it is quite funny that you dismiss the 20 million XBOX units sold when the XBOX as a brand isn't even 5 years old yet! And it managed to garner those sales in a hostile games market with 2 MUCH older and well established competitiors. It even outsold one of those competitors although no one here would admit that. SON¥ had the industy handed to them by Sega and Nintendo and Nintendo WAS the industry for a long time. OF COURSE it took billions for the XBOX to get anywhere, look who they were up against.

You also appear to be dismissing the US as it isn't the largest and most important market in the industy. Right now the biggest and best selling titles come from the US, the biggest publisher resides in the US, and the country that seems to be willing to spend the most on game entertainment are from the US so saying the XBOX did well in the US is IMPORTANT! Japan was NEVER going to see XBOX as anything more than a joke, it doesn't matter what games they have on their platform. And M$ made some serious mistakes with pricing in Europe so they fumbled up right from the start. We'll see how things work out this gen.

Your comments about the PS2 outselling XBOX and the 360 are laughable because in both cases I'd say M$ is more responsible for the sales difference over anything SON¥ has done. The 360 has issues with distribution and the original XBOX is no longer supported by M$ wow way to go SON¥!! Not saying that SON¥'s sucess last generation, longer time in the market, and larger game library didn't have anything to do with their success but you have to admit that much of PlayStation brand was built up just because it had little or no real comptition until M$ came along. What will be truly interesting is to see just how much developers will be willing to start from ground zero supporting the PS3 with no installed base over the 360 which should have a sizable base by the time the PS3 hits. Of couse the exception here is Japan, but as I've already mentioned the 360 NEVER had a chance there, and luckily they aren't nearly important as they once were.

The Dark One

please don't respond to monkeymagic. his sony bias is astounding & as u can see it makes him post stupid things.

 

[Piper Az]

Does it really matter? Without both of them we wouldn't be seeing such a competitive war going on.

Learn to love them both already.

Hey, I love them all. I just want to point out flawed logic.

Gamecube will outsell XBox when all is said and done.

And I wasn't confining those brands to the console industry (hence the mention of Apple) - Nintendo is a strong brand in the handheld industry.

Again, how do you know? And using your logic of "not confining beands to the console industry, I'm sure you won't argue that MS is a strong brand in the software industry.

 

[vangace]

I don't normally post in the gaming forum but this thread is so stupid in every way imaginable. This issue has been discussed long before the 360 came out. MS will eventually make money on the 360, my guess is by the end of the year if they don't reduce the price. Unlike the xbox, microsoft owns the IPs on major components of the console which means they are not tied down with licenses like they were with nvidia. Manufacturing and component costs will go down eventually and MS has a chance to break even or make a profit. However, they might choose to reduce the price when PS3 comes out and in that case it will take them another year before they make money.

On the other hand MS might not be so overly concerned with profit right now since 1) they make money on games 2)Losses sustained by 360 might insignificant since they are offset by profits from other divisions.

You also have to look beyond the literal meaning of Profit. Companies like MS, Berkshire Hathaway have a stock pile of billions of dollars, however stock piling money is pretty dangerous since it reduces the companies ability to grow (MS suffered from this for years since they stock piled all their retained earnings and did not start giving dividents unitl last year). So they might invest in projects in which they won't see any profit for years, at the same time they are creating goodwill in other they are cultivating a brand name. A good example is Toyota, for a longtime they were a joke in the US, just GM and Ford.

The point is, the way MS perceives Profit is different to the way Sony perceives Profit. The only way to see if MS will make money is wait at least another 10 years. Its probably the same way Sony looked at it 15 years ago when the playstation idea was conceived.

I don't even know if what i wrote makes any sense but fuck it, this is GAF, nothing makes sense here

 

[_Angelus_]

Hey, I love them all. I just want to point out flawed logic.

Well I agree with your points anyways so my post was geared towards some of these people who come up with some oddball view points,such as the guy youre debating back and forth with. :lol

 

[monkeymagic]

Again, how do you know?

Because MS has killed XBox.

Killing the hardware sales and at the same time killing future development of games for the platform with their botched BC.

GCN will outsell it this gen leaving MS 3rd for their $6 Billion spend.

A failure by anyone's book.

And using your logic of "not confining beands to the console industry, I'm sure you won't argue that MS is a strong brand in the software industry.

Yes MS is a strong brand in the software industry.

But again, no bearing on XBox brand which isn't a strong brand by any stretch of the imagination.

 

[Piper Az]

But again, no bearing on XBox which isn't a strong brand by any stretch of the imagination.

So, I ask you again - How did this "weak" brand called Xbox beat out Gamecube of Nintendo, which you consider as a strong brand when both were in the market in full force? Oh yeah, I'm considering this time window only since you kindly pointed out that the Xbox is killed now by MS - it wouldn't be comparable to emphasize Gamecube's staggering sales over the Xbox when one of the two no longer exists, right?

 

[monkeymagic]

So, I ask you again - How did this "weak" brand called Xbox beat out Gamecube of Nintendo, which you consider as a strong brand when both were in the market in full force?

You don't seem to be understanding - Nintendo is a strong brand in the handheld sector, Sony/Playstation in consoles and Apple/iPod in MP3 players.

They all dominate their respective sectors.

Please state which market the XBox brand dominates with such considerable margins.

I know Americans like to perceive the XBox brand as strong but the reality is it is no stronger than the likes of N-Gage here in Europe and virtually non-existant in Japan.

As well as dominating their primary markets, strong brands transcend international borders and cultures - they don't just exist in arbitrary microcosms to suit their proponents.

 

[CassidyIzABeast]

the short answer is fuck no

 

[AdmiralViscen]

Because MS has killed XBox.

Killing the hardware sales and at the same time killing future development of games for the platform with their botched BC.

GCN will outsell it this gen leaving MS 3rd for their $6 Billion spend.

A failure by anyone's book.



Yes MS is a strong brand in the software industry.

But again, no bearing on XBox brand which isn't a strong brand by any stretch of the imagination.

Cube's sales died down now that the holidays are over. Have you seen the January numbers?


Why won't you allow MS' strong brand name in software to be applied to XBox, but you will allow Game Boy and DS' strong names to be applied to GameCube?