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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 $2 billion funding Xbox live over the next five years, suggesting it will be some time before the home entertainment division break into the black."
The main reason the x-box is losing money is quite simple: because it uses the pc architecture.
Other systems such as the playstation2 or the gamecube have been sucessful because they have a large amount of propreitary games and use propreuitary hardware. For instance you can't buy a gamecube or playstation2 to and run linux on it, but on the x-box you can.
Apple uses propreitary hardware and software, and they have had consistantly good sales for the past few years. By using the PowerPC chip instead of the standard x86 architecture for computers apple has created a propreitary market which is very profitable. EG. If you want to run Itunes you have to buy a 3,000$ computer. Microsoft hasn't latched on to this and by using standard PC hardware anyone can use their system any way they want.
Since microsoft loses 100$ on each xbox sale, a person would have to buy at least 2 games for them to make the money back. If a user simply buys an x-box to run linux on it, which many have done, then MS loses 100$. The simple answer is: Linux has killed the X-box sales. This is good. Lets just hope Microsoft doesn't begin to take legal action on X-box hackers.
GoatPigSheep, the 3 most important food groups
- 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.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.
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!
-BrentI 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]
Need help treating your acne? Come here!
Ha! Ha!
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.