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How Microsoft Tried To Buy Nintendo
An anonymous reader submits: "A new book, Opening the Xbox: Inside Microsoft's Plan to Unleash an Entertainment Revolution discusses Microsoft's plans to buy Nintendo for $25 billion in late 1999. By January 2000 however, talks dissolved and each company went their seperate way. Makes you wonder how the home entertainment industry would be different if they had gone through with it. Stories are at Gamers and Cube Europe."
I think Microsoft will never be a big player in the videogame industry, regardless of how much money they pour into it.
They need to dominate both the American and Japanese markets to stand a chance.
Here are some of the things that will stop them:
- Most important video game developers are Japanese. Those companies have strong relationships with Sony and/or Nintendo. You simply can't buy your way into a closed industry in Japan. I know, I work there.
- Culture clash. Japanese gamers don't like the Xbox. It's big, ugly and all the exclusive games are very American.
- Microsoft has absolutely no way to force anyone to buy an Xbox. Their Windows/Office tactics don't apply here.
- MS actually looses money on each Xbox they sell. If they don't have a big market share a couple years from now (and they wont), they will NOT keep trying. Not even M$ can afford to do this.
If I was Microsoft, I would make Xbox2 run PC games directly. No porting needed whatsoever.
Cheers.
"Then they go to plan B - offer a similar product for free at a vastly reduced price (or free) - force them out of business - then you have a monopoly! "
Harldy a winning strategy. If MS were to drop the price of the XBOX, they'd go DEEPER into the hole on each machine sold. As it is, it costs like $400 or $500 to build one of the machines. Nintendo, however, is either close to break even point, or even making a profit on their $200 machine.
MS cannot legally undercut the price of the XBOX, it's called 'Dumping'. The FTC would strangle them over it. (In theory, so far the US gov't doesn't seem too wild about telling MS no to anything.) I vaguely remember Atari threatening to sue Sony over it when the Playstation was announced to be $200 (I think it was released at $300, though...) for similar reasons. (Anybody remember that?)
Nintendo could easily afford to drop the price of the Gamecube even farther. It'd either be extremely bold or extremely stupid of MS to try to get into a price war with them. That's not MS's biggest problem though.
XBOX just doesn't have the winning titles yet. There are some okay games for it, but they really need a Miyamoto on their side. One of the things that kind of drove me away from being a game player is the lack of imagination and thought being put into games. If MS were smart, they'd drag out every Miyamoto and RARE game ever made and devote a group to figuring out why they're fun. Then, they need to set up a division intended to make games like these. (not copy them, I mean continue the spirit of them.)
MS would be smart to make better games, that'd be a far better strategy than trying to beat them at price. That is unless they start giving away XBOX's along with the purchase of Gateway PC's....
"Derp de derp."