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XBox + UltimateTV for $500
Daetrin writes "Red Herring reports in this article that Microsoft is planing on combining the XBox with their UltimateTV Recorder with a projected final cost of about $500. The article also talks in some detail about the massive (though partially expected) losses that the XBox is costing Microsoft. There's also another article on Yahoo that sums up what Red Herring said."
Again, they're complicating what is supposed to be blazingly simple. Console games are attractive to many for ease of operation.
And to some, plunking down $500 may seem like a lot, people may decide to make separate purchses for a video game and PVR instead.
Maybe Microsoft should be looking at their offering of games instead to see why they're losing the battle against sony and Nintendo.
I am the evil aardvark!
"A machine that combines the features of the Xbox with UltimateTV" could mean one of two things. The way I understand it, you would have to essentially buy a new Xbox (if you already have one) when you purchase this device. Wouldn't it make more sense to provide expansion and upgrade features for the current Xbox, rather that incorporation its technology into a new device?
"The product is controversial in part because it creates a conflict within the machine: will the game slow down so that the hard drive can record "BattleBots"?"
A game machine is not a PC. It's a game machine. A game machine doesn't want to be $500. A game machine doesn't want to be interrupted by non-gaming experiences. Remember the CD-I (Phillips) or the 3DO? A game machine aspires to being played, that's it.
Microsoft: Halt development of the combo unit, and pump the money into having games made for the XBOX. I don't have an XBOX today because I'm not wild about the game selection on it. Building a PVR into it will not save you, not for $500.
"Derp de derp."
The XBox really really is amazing. Here we have a product that defies the laws of economics. At this point its just a matter of how much money Gates and Ballmer can stand to lose. Its an ego thing. Every other company on the face of the planet would drop a money losing project like the XBox as fast as possible. The world is filled with companies that are not named Microsoft which have stock holders and corporate boards that actually have influence over the decisions of executive management. Not so with Microsoft.
We all know that XBox is finished in Japan. If Microsoft is lucky they will manage to sell their original shipment of 250,000 Japanese XBoxes before the end of this year.
http://www.the-magicbox.com
The XBox is in the process of dying in Europe. Just look at the European software charts. The XBox has just one exclusive game in the top 20:
http://www.elspa.com
And now one of MS game developer partners has pressured MS into allowing it to publish title for the Nintendo GameBoy:
http://biz.yahoo.com/rf/020625/tech_thq_microso
Is there anyone out there who will force Gates and Ballmer to come to their senses? Or would dropping the XBox at this point be such a face losing position for Microsoft that they have no choice but to keep throwing money at it?
And in fact they sort of need to spend money. It might sound nice to have so much cash lying around, but for a big corporation it can be a nightmare. In the current money market, that $40 Bil will not stay $40 Bil for long. And since they follow the "recycle the profits" model (MS stock does not pay dividends), it's only going to get worse. Better to throw the money at a Blue Sky project and tell the stockholders they're generating long-term growth. Which might even be true.
But damnit, it's time to drop all the Reagan-era cliches and face facts. That much economic clout in the hands of one company is bad for the whole software industry. Including Microsoft. This is not a free market. Pretending otherwise is like saying Al Capone was just another illicit beer vendor.
Yeah, I tend to agree with the original poster (although I can't really speak for why PVR's aren't available at Best Buy and the like -- maybe they are just always running out of stock?).
I'm starting to get really touchy about paying any more money out for subscription type services, and that's a big reason why I haven't bought a PVR. In today's society, we're expected to spend an awful large chunk of our monthly income on services. When you sit down and look where your money is going, it's rather scary.
I'm paying out $50 a month for my DSL circuit, another $30-50 for my analog phone line it runs through, $30 a month for my cellphone (more if I use it too much), $25 a month for my DirecTV subscription, $10 a month for a basic "EasyNews" subscription so I can download binaries from Usenet reliably and quickly, and am doing a free trial of the $19.95 per month NetFlix service to rent DVD movies by mail. Of course, none of this includes the "essential" utilities like gas, electricity, water, sewer, and trash pickup -- which are still services that disappear as soon as you quit paying for them.
Everything's always "only $10 a month!" or whatever, and before you know it - you're talking thousands a year in these non-essential services, chipping away at your income.
IMHO, the PVR thing is a neat idea - but really, could have been implemented a lot better if they got "buy-in" from the TV/cable/satellite networks. They cold broadcast some hidden data along with their signals that PVRs pick up -- eliminating the need for a service run by the PVR makers to give them their "brains".
I don't remeber wich store in the mall it was but they had a sign in the window that said xbox $99 with trade in of old game system. When I asked about details they said you have to trade in a dreamcast,N64 or playstaion plus 10 old games. I wonder if this is M$ is giving them a kick back to get the old systems out of circulation.
http://Lenny.com
It seems that the US is pretty fond of heavily taxing or banning imports of products that are sold "below cost"- they call it "dumping". (Think steel, DRAM, etc). I wonder why Japan hasn't banned or put a stiff tariff on the Xbox since Microsoft is "illegally dumping" the Xbox in order to steal market share from Sony's PS2.
Could be an interesting tactic if X-box starts winning some significant share...
I'm not a Microsoft employee but I do contracting work for them in Redmond. On four occassions I have offered Microsoft employees (a Project Manager, an Windows Server architect, and two Resource Kit technical writers) $100 if they could find a single, significant computing innovation that originated with Microsoft and made it to market. This wasn't a bet... I would just pay each $100 if they could find an example.
So far none of them have claimed to find one or asked for their $100. I gave each a week or two (one guy 2 months so he could ask around).
Admittedly this started out as a way to tweek Microsoft's arrogance. But, I'm REALLY curious now. Has anyone heard of a single significant computing innovation attributable to Microsoft?
There is some chance that Microsoft could salvage XBox if they are able to sign up a significant number of people on their upcoming subscription-based gaming network. However, Microsoft loses too much money on the hardware to ever make a profit on the software at current prices. Current royalties per game are generally below $10. So Microsoft has to sell a whopping fifteen games over the life of the console before it starts to see any profit. What's worse, is that Microsoft has already squeezed all of the price out of the XBox, and they are still selling at a huge loss. Nintendo is actually making money on their console, and Sony is breaking even, and both of these companies are going to be able to save money down the line by integrating the chips in their consoles.
In other words, Sony and Nintendo both have the power to go to war with Microsoft on price and still make money, and they will be able to make Microsoft bleed for years. A year from now Sony and Nintendo will really be able to punish Microsoft. The price of making an XBox is only going to drop $100 over the next five years.
Now, if Microsoft can get a significant number of current XBox owners to sign up for their gaming network, then they are in the clear. Plenty of companies have used subsidized hardware to sell internet service. Over time the subscription model would generate enough money to cover the initial cost of the hardware. The dodgy bit is that Microsoft is essentially betting billions of dollars on the success of their gaming network. As things stand now an Xbox gamer that purchases an XBox and ten games, but does not sign up for the online gaming network, causes Microsoft to lose money. In fact, the numbers are so bad for Microsoft that I can't quite figure out why they don't require a subscription. They can't possibly believe that they are going to make up their hardware subsidy with game royalties at the current price structure.
In the end I think that Microsoft is going to end up taking a bath on the XBox. Sure, they can afford to lose money on the XBox, but I could also afford to give my house away and live in a box. Being able to afford something doesn't make it good business.