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Microsoft Loses $177m on Xbox in Three Months

Albanach writes "The BBC News are reporting in this story that Microsoft's Home Entertainment Division has filed a submission to the Securities and Exchange Commission reporting a loss of $177 million for the three months to 30 September 2002. The loss comes on revenues of $505m for the division that manufactures the Xbox games console. Microsoft are said to be prepared to spend $2 billion funding Xbox live over the next five years, suggesting it will be some time before the home entertainment division break into the black."

6 of 719 comments (clear)

  1. How to make the Xbox a success by b.foster · · Score: 2, Troll
    As an avid gamer and self-proclaimed "gadget freak," I can tell you that Microsoft has spent the last two years shooting itself in the foot with regard to their Xbox strategy. I have seen Xbox Live, and to be frank, the extra voice features and other refinements are nothing to write home about. I have a few suggestions as to how Microsoft can turn the trend around and avoid a massive failure like Microsoft Bob or UltimateTV:
    • Keep it open, stupid. The barrier to entry is very high for Xbox development - the very opposite of the strategy that have made Linux and Windows very successful amongst amateur programmers such as the founder of this site. "Developer" Xboxes which will run all signed and unsigned software should be plentiful and cheap - not subsidized, but rather sold slightly above cost. This has the benefit of making Microsoft's economy of scale pay off for thousands of potential game developers (read: licensees) as well as hardware hackers who are looking for a cheap PC.
    • Buck the content industry. Manufacturing Xboxes that defeat region encoding and macrovision with small modifications would cause sales to skyrocket. Likewise, since Sony has their own gaming arm and no other RIAA/MPAA company is involved in game production, the support of the content industry is meaningless.
    • Focus on getting better games. Why does nobody develop good games for the Xbox? For starters, Microsoft has failed to push Xboxes in the game capital of the world, Japan. Microsoft needs to revamp their entire strategy with regard to this country, starting with the release of hentai games and ending with the successful ports of many PS2 games over to the Xbox platform. The Xbox will go nowhere if there is no good software to run on it.
    • Keep manufacturing costs down. Microsoft needs to switch to AMD or Transmeta chips, which pack more power for the buck, run cooler, and are 100% compatible with their existing software base. Also, this will allow them to use cheaper graphics coprocessors by using a cheaper, more powerful main CPU.
    These are just a start, but if Microsoft takes these suggestions, their Xbox division will be well on its way to profitability.
  2. HOLY COW 177 Million! by Real+World+Stuff · · Score: 0, Troll

    Amazingly that is not even half of what VA Softare burned through. At least Microsoft has a tangible product to sell.

    --
    If we don't fight for ourselves no one will.
  3. Re:Oh sure they're selling consoles... by bmetzler · · Score: 1, Troll
    People are still choosing PS2 over the technically superior X-Box - why?

    How did you come to the conclusion that the XBox is technically superior? Technically, I believe that the PS2 is superior. Look at the tech specs for it. Wow!

    -Brent
  4. Re:Only $177m? Who cares? by Com2Kid · · Score: 0, Troll
    • E.g. genetic manipulated Soja needs to be noted as incridience in european food(by law). Europeans as majority do not buy genetic manipulated food. Feeding animals with genetic manipulated food is not allowed,
    • as it gets to difficult to prove its absence in the final products (like ham).


    I am amazed at how ignorant people are of the basis of genetics. . . .

    Genetically engineered food is, err,

    *sigh*

    food but with just a few molecules changed in the GENETIC STRUCTURE.

    This has ZERO effect on the food after it has BEEN DIGESTED.

    Genetic structures are inherently weak, unless they are protected by some coating such as certain bacteria or viruses have, they are EASILY dissolved by the high acidity in most mammalian stomachs.

    And even if they weren't, plant genes are NOT going to cause your children to take root to the ground. If that was so then REGULAR UNMODIFIED FOOD would effect you the same as GENETICALLY MODIFIED FOOD.

    But hell, if Europeans want to pay more for their food, they can go right ahead and do so.

    Suckers.

    Now I will admit that a number of genetic food companies are total pricks and I will not buy from them for various reasons (being horrible "corporate citizens" and all) but I am all for genetically modified food in general.

    [/end europo rant]
  5. Cue Nelson Laugh... by deanthebean · · Score: 0, Troll

    Ha! Ha!

  6. Nintendo has STATED that GC costs ~$90 to make. by Viewsonic · · Score: 1, Troll

    Stuff it if you think otherwise, this are right from the horses mouth. You can already buy the cube for $99 at EB as long as you buy 2 games with it (Metroid and Mario anyone?) .. They've been making mad profits since the release. Not to mention the biggest games are all from nintendo directly. Sadly, MS will probably kill the XBox because they had no idea how to make a console.