Xbox 360 To Profit Next Year, Says Bach

An anonymous reader writes "Robbie Bach, president of Microsoft's entertainment and devices division, has stated he expects the company's console business to finally break even some time in 2008. After years of losses from the games division, this would be a significant breakthrough for Microsoft's efforts in the games industry. '"Xbox is the hardest piece of consumer electronics hardware to produce in the world, no debate," he said, admitting that "costs are a little higher than we'd like." Microsoft doesn't expect to make a profit on hardware alone, but "we'll probably be gross margin neutral on that over the life cycle of the product, and try to break even on that."'"

Comments

Re:So really...

[blackicye]

I think you're missing part of the lesson to be learned from the Wii. That being that innovation in gameplay

I'm calling it a fluke. Judging from their last 2 consoles, N64, Gamecube..the innovation in Wii was part calculated risk and part sheer dumb luck instead of any revolutionary forward thinking.

Re:Lessons

[theStorminMormon]

Your statement about better margins in the high end market is conjecture.

Yay for obnoxious Slashdot know-it-alls. You'd be one of the resident representatives of the anti-social branch of nerdom, right?

My example (Dell vs. Alienware) is actually factually true. The general rule that luxuries have a higher profit margin is also pretty well-established. The idea that high-end consoles will have higher margin in the future and that that is why Sony and MS are chasing that martket segment is obviously conjecture (since it's about the future) but you know what? That's what we do when we talk about the future. We use available facts to make conjectures.

Thanks for providing me a stupid comment to vent at anyway. Cheers!