Slashdot Mirror
A History of the Xbox Red Ring of Death Fiasco
VentureBeat has a lengthy story about the situation surrounding the Xbox 360's "Red Ring of Death." It starts with the developmental phases for the 360, looks at the marketing decisions that drove Microsoft to aim for a release ahead of the PS3, and talks with sources and engineers within Microsoft about what could have been done to prevent the problems. Quoting:
"Leading up to the launch in the fall of 2005, the number of defective units would soon grow to tens of thousands. Any other consumer electronics company would likely have postponed a launch with such low yields. But Microsoft had more money in the bank than anyone else. The decision this time would fall to Bach and Moore. The costs of launching with low yields -- where you take big losses on every product sold -- could bankrupt other companies. But Microsoft could afford to do so. Microsoft did delay the launch date from October until November. But some inside the company still believed returns would be out of control."
In b4 fanboi console war shitstorm...
How timely seeing as I just got mine....WHY????
I'd appreciate it very much if someone could please explain to me, how is it possible that one company sells something at a loss and it's called "dumping" (which you can get in trouble for, IIUC), and another company sells something at a loss and it's called a "loss leader?" Wtf? It's especially clear in this case, when you have orange rings of death and whatnot, that the purpose is to bankrupt the competition by selling yours for less. By the time someone spent their Christmas money on one product, they won't buy the other. Hence, dumping.
McCain/Palin '08. Now THAT's hope and change!
In 3, 2, 1 ...
What if the company is just facing the domino effect of collapse because their engineering and management does not work anymore. It makes me depressed to observe all this. They were unable to deliver VISTA in time. Customers and hardware suppliers actually hate VISTA.
They develop a game console with gigantic losses. They develop the next game console as a second choice. Maybe something is broken in their management of development. I mean look, where is the bugzilla server for the xbox?
Do you remember the story about the lawyer's letter to the parents of the baby killed by an Xbox fire?
But this Slahsdot post finally reminds us that Microsoft was never different. When we look back there is actually a history of autism in the company but it always paid off in the past. Like Napoleon, an insane leader who did every mistake but for some time he was quite lucky.
Maybe not in time for you, but seeing that another price cut for the 360 models is imminent, could be that an editor at Slashdot thinks that warning potential buyers is a Good Thing (TM), at last.
A World in a Grain of Sand / Heaven in a Wild Flower,
Infinity in the Palm of your Hand / And Eternity in an Hour.
I remember reading the stories back in 2000/2001 when people first found out about the Xbox. It was taken as a given that it was only a few months from launch that Microsoft would take over the console market.
"Microsoft has billions!"
"Gates always gets what he wants!"
"Microsoft will just buy every developer and make them work on the Xbox!"
and a million similar claims were made.
It is shocking to look back over the 7 year long train wreck that the Xbox turnd out to be. Some 7 billion dollars has been wasted on so little to show for their efforts and now with the 360 they have taken on the reputation of having created the worst console in the history of gaming.
Microsoft really needs to wake up and get back to supporting the troubled PC gaming market. All those billions wasted on the Xbox could have done wonders for PC gaming. PC gaming was one of the major factors that made Microsoft OSes so popular with IT guys over the past twenty years.
Wait, what? You mean the evil old space-shuttle-sized black toaster had the red ring of death problem just like the sleek new 360? Oh, wait, you just forgot to put "360" anywhere in the summary. Or the tags. Or the category icons. Good job, guy(s).
Bio questions? Ask me to start a Q&A journal. Computer analogies available for most topics!
It's kinda like their software. They know it doesn't work and has glitches and will crash and they release it anyway. I'd list examples but it's basically all software they've ever written. When people made games for the N64 there was no patching. They tested it until it was basically perfect and then released it because a crash glitch was unacceptable. These days companies like Microsoft can change it from beta to release whenever they feel like it's just barely stable enough to work most of the time. It's all because they want their money now. Okay, I gotta list one example. Windows ME!
Google's Super Secret Search Algorithm: SELECT @search_results FROM internet WHERE @search_results = 'good'
The future profits that the company once hoped for are now likely to wind up in Nintendo's pockets.
Right, just like a defective Audi will drive people towards purchasing a Toyota Yaris. Nintendo and Microsoft aren't competing for the same market niche, and apparently the author doesn't realize that. The Wii is for casual gaming, the XBox and PS are for hardcore gaming. Might as well say that peggle is taking sales from Half Life 2.
The XBox360 is getting a lot of negative press, but I think they made the right call by launching early. They've been able to displace a lot of the negative press by extending the warranty and making sure that people get their xbox's replaced. Also, the PS3 is too expensive and the controllers are crap; it gives an overall feel of not being worth the money. The mass exodus as exclusive titles left Playstation to go multi-platform says it all, really.
No pussy for YOU!
I wonder at the timing of a Xbox-critical article on the exact day the latest price cut hits, bringing the Arcade version under the price of the Wii.
The first two questions to ask about any news story:
Why am I hearing about this, and why now?
It's amazing how much is revealed by these 2 questions.
clearly you are new here.
If you mod me down, I will become more powerful than you can imagine....
We've seen it time and time again, how Microsoft can afford to buy it's way into a market segment. I wonder if it will pay off in the long run, because it seems they've hit a saturation point with this product they have. Not much growth over the last product revision, and barely making a penny in the last few quarters (let's not talk about making up for all the loses to date yet).
With the stock price stagnant, how long can upper management convince shareholders that this is the right thing to do?
AirSpeak - http://itunes.com/apps/AirSpeak
...right now with their G84/G86 GPUs at the moment. They estimate their losses to be in the range of 100-200 million USD. Dell, HP, ACER, Lenovo, and other laptop makers are affected by this with no end, or resolution for the owners of the units containing the defective chips, including yours truly.
The failure rate has been measured in either weeks, months or years. Owners of the affected laptops have been buying extended warranties to cover replacement in the event they should fail.
Dell has acknowledged this issue but has given no solution either. The other companies have stayed mute on the matter. All of the Dell built laptops that have the faulty chips fail are replaced with laptops with the same GPU in them, no alternatives or options given to the owners.
First rule of holes; When in one, stop digging.
The red ring of death actually made more sales, you xbox dies, and while waiting for a new one, you go buy a 'spare' xbox!
My XBOX 360 dis 4 months ago and I bought a PS3, re-purchased all 6-8 games I play (mostly FPS team games, GRAW, COD, RS).
How do I feel? I feel like using Linux: it is better than windows, but lacking stuff. PS3 is superior (like linux) but it is lacking a strong community feeling like xbox live. It is also lacking the sometimes needed, but sometimes hated strong core (assholes) who play 600 hours a month to be the best in certain games. These are the guys who sometimes hate, but the ones who give a strong core. It is like when I used to race bikes. Many people hated us, but so many respected us that we kept the sport up. Well .... this is something I am missing from ps3.
The system is superior, the blueray is SUPER-DUPER, but I go online, 4 out of 16 have a microphone, and then 2 start team killing.
Bottom line: I am not buying a xbox because it will die on me, I am not getting a wii because I do not want to host family parties (nor play mario #122 or other kiddie games), and I keep my PS3 to play once a week (I pkayed XBOX 4 times 2+ hors a week)......
Well, maybe I just keep all that money I spent on games and spend it on my motorbike, and if I really want to shoot at people I just go and play paintball....
Dunno .... really, just opened a game coming from amazon (grid) and I realized, that without a strong online backing (like XB LIVE, whic I [prapaid for a year) any console is as good as a brick .....
Still I am with this shiny piece of shit, and the other white crap (xbox) is on the floor disassembled with a red ring of death ..... well .//... really I like games, but dunno where to go .....
Sony fanboy ? My siby canera developed a dead pixel after 2 weeks of diving (30+ meters, maybe one hard impacts). Local support SUCKS so much I never bothered to even try. While MS support is the WORST, and I use linux, than OSX (apple) for an operating system for the last 16 years) I rally wish anyone had such a cool service as xbox live.....
I guess ... hmm dunno ... can apple maybe make a console and make a service that costs but works, and then I do not have to rely on crap MS hw&sw and crap sony service?
OK I am complaining, but even being a gamer I am just trhinking of selling my ps3 and just forget about it till a quality console with a quality service comes along...
If you consider the number of AAA titles that are release exclusively for xbox, then it is pretty clear that MS must have done something right. My second 360 is now worshiping at the altar of the ring of death gods. My first went seven days after I purchased it, during a nonstop weekend of Gears, they replaced it immediately. I expected my second request for a replacement/repair to be shut down quick smart, but my 360 is currently undergoing a resurrection at MS HQ (or whoever they use in oz). It is ages out of warranty yet they are still happy to repair it. Nice one brother! People can bitch and moan all they like about how design defects shouldn't make it into production, but this shit happens. Whether it is because of a tactical decision or just sheer stupidity, doesn't really matter as long as they deal sensibly with the consequences. I can't fault MS's after market service, save for the dodgy Indian call centre experience. Now I loath IE, Office, XP and Vista is much as the next /.er, but the range of titles, the ergonomics of the 360 controller and the sheer enjoyment I have derived from my 360 means I will be a fanboy for a long time to come. It is a quality product, albeit executed poorly.
Thankfully the average consumer is well-enough informed to boycott such a deeply-flawed product, thus preventing Microsoft from profiting off of this business model! I mean, can you imagine if they were selling millions of 360s, taking broken units back, and still making money?
I'd appreciate it very much if someone could please explain to me, how is it possible that one company sells something at a loss and it's called "dumping" (which you can get in trouble for, IIUC), and another company sells something at a loss and it's called a "loss leader?"
Dumping is a form of predatory pricing under international trade law whereby a product is sold below cost or below market value in the country of origin. Economists sometimes take a more general definition of dumping to mean any kind of predatory pricing but in my experience this is a less common usage. Dumping often occurs when a producer has excess capacity beyond what their home market can absorb so they sell the excess in a different market either to damage current/potential competitors or to gain market share.
A loss leader is basically a sales promotion. One product is sold cheaply (possibly below cost) with the expectation, but normally not the requirement, that customers will be enticed into buying additional more profitable product(s). The most famous version is the razors and blade model pioneered by Gillette.
The important difference is that a loss leader isn't necessarily destructive. With dumping there is no attempt at profitability, at least not in the short term. However predatory pricing in general, including dumping, can be very hard to prove. It's quite rare to have clear evidence that dumping is occurring. Furthermore in some countries (notably China) it's not unusual for the government to hold stakes in manufacturing firms. Naturally it is rather difficult subpoenaing records from a state owned Chinese manufacturer so you can sue them for dumping.
For instance, it can't be that difficult to design an OS that works. Linux has done the basics, and it is free. Apple has done the GUI, with much less money than MS. Yet the best MS can do is a spend millions of dollars on pointless commercials. Is this because it has no idea how to fix the software? Is there no way to invest the 77% profit margin in making working products. Does it all have to spent on yachts.
And it is not rocket science to design a game console. We have had generations of them that worked very well. MS just jumped in and borrowed existing tech, then used the windows 77% percent profit margin to subsidize the costs. And the xBox 360 is the second generation product.
Of course, we must acknowledge that MS tried to design custom hardware, a task for which it has no experience. This leads to the question of why it couldn't just pay for someone to do it right. Oh yeah, the yachts.
People like to compare IBM to MS, and see MS slowing down, but then ultimately being successful like IBM. What people fail to realize is that IBM spent the money to make rock solid products. The Selectric was a damn near perfect machine. The big iron did their job. The IBM PC was bulletproof. I don't know how MS is going come out the other side of the desktop monopoly when Google moves all the customers to the clouds with a six nines failure rate, and MS is still living in a world where a four nines failure rate is acceptable.
"She's a scientist and a lesbian. She's not going to let it slide." Orphan Black
FTFA: "Microsoft has still sold more Xbox 360 consoles than Sony to date."
Damn, I never saw that coming!!!
"16MB (fuck off, MiB fascists)" - The Mighty Buzzard
Microsoft's problem is pretty simple, hubris. It's illustrated quite well when you look at the kind of management practices taken by Ballmer and to a lesser extent Gates.
Microsoft has been so enamored of their own success that they believe that they cannot go wrong, simply because of who they are. They are also more than willing to pursue business with the kinds of principles and ethics that you'd expect from a used car salesperson. They really don't care what the customer experience is, they care about making money and believe that no matter what they do, they will succeed regardless.
Well to some extent that's true, or was true in the past, as mass and momentum are real. However it's also very clear that eventually momentum decreases and customer loyalty is a fickle thing. MS is already seeing the fruits of their poor judgement. Apple is selling more Mac's than ever, and I'd argue that Vista has played a big part in that success. I for one don't own an Xbox 360, I own a PS3. I probably won't ever buy a 360.
I'm sure Microsoft will recover, but to what extent remains to be seen. But unless they change their principles and work toward attracting the kind of loyalty through quality and connecting with your customers that Apple has enjoyed they will continue to see, if nothing else, a customer base that will be willing to jump ship at the first opportunity.
I was playing Halo 3 the other night and my network connection was acting up, then the game lurched, froze and put tons of bars across the screen, followed by a loud screeching noise
so yeah, my Xbox RROD'ed on Sept 1st. I think its kind of odd that this story would pop up on /. within a week of it happening to me. I should pry call Microsoft sometime soon to get it replaced, but seeing as I'm a busy engineering student I haven't gotten around to it yet. Does anyone have any tips for dealing with Microsoft concerning this problem?
wish me luck
I usually wait 6-12 months after a console is released before I purchase it so that I can get one with a working mod-chip from Canada. I'll be damned if Sony, Microsoft, or Nintendo are going to tell me I cannot play backups. Yes, Backups. So I had nearly a year to watch this infamous shit storm start, and not become a victim.
The problems with the console were known fairly early by pretty much everyone. People talk. Kids talk even more, and most times you cannot shut them up. After about 6-8 months I myself heard about RROD constantly from people. Microsoft really "screwed the pooch" on this one and AFAIK, the losses on the returns have been at least 1.9 billion. That is a staggering number.
The only thing new about this is that there were people in Microsoft that knew they had quality problems, and yet made a business decision to push forwards anyways. The only word for that is hubris. That is what really amazes me.
That is awesomely full of shit. It says that he is an executive though, so I am not surprised.
The WHOLE reason I have still not purchased a XBOX360 is the Red Ring Of Death fiasco. It has to be the most unreliable product put forth in decades, probably since the Ford Pinto. I am not a fanboy and I own both a PS2 and a XBOX. I would really like to get a XBOX360, but to this day I cannot be assured that it will not fail within 6 months.
I bet that the "gamers" polled in that little research project were ALL under 14 years old. Of course they "forgave" Microsoft. They're kids! Try asking their parents if they can receive forgiveness. I bet there would be a different story entirely as shipping costs are not free. The time and hassle on the phone to get it taken care of takes its toll.
Forgiveness? That's a riot. Nobody that had to pay for that console is going to forgive or forget about this for a long long time. This WAS Microsoft's version of the Ford Pinto, even more so than Vista. That is saying something too.
The first Xbox was just shy of being killed off when management grasped the magnitude of the fiasco but they were convinced to hold on.
When they were forced to pull the plug on the first Xbox there were all sorts of promises that the 360 would be the console where the E&D division 'got it right' finally. The E&D execs were given a stern warning that the first Xbox style losses were not going to be tolerated a second time.
The 360 has racked up Xbox style losses once again.
Needless to say the Xbox is the most hated project amongst Microsoft people with a 'how can we work so hard and those Xbox clowns are dragging down our earnings and stock price and not be fired' attitude.
Microsoft has been moving Xbox services over to Windows gaming over the past year. And Microsoft execs have stated that they aren't going to be killing off the 360 and letting the E&D fuckups create a third financial and marketplace fiasco. The 360 will be allowed to just fade away in the market as Microsoft turns their attention to Vista exclusive gaming.
Although if Ballmer gets the boot or loses power the entire E&D division is going to be essentially wiped clean by whoever comes in to clean up his mess. The Xbox and Zune disasters will be the top of the list.
more gr48diose
I think that Xbox is the best thing that happened to PlayStation. In the real world, there is nothing like a little competition, especially direct competition. From Wikipedia's article on competition: "Merriam-Webster defines competition in business as 'the effort of two or more parties acting independently to secure the business of a third party by offering the most favorable terms.' Seen as the pillar of capitalism in that it may stimulate innovation, encourage efficiency, or drive down prices, competition is touted as the foundation upon which capitalism is justified."
Yes, because potential Wii buyers were hesitating between 360 and Wii are now shocked to find out Microsoft's 360 is the most poorly designed console ever.
360s have been RRoD from months before the mess of a console even launched. Microsoft has had three years to get their shit together and still 'My Xbox died' threads in gaming forums all over the Net are gigantic and active daily with the latest batch of 360 owners posting their RRoD stories.
It's not the media's job to do damage control for Microsoft's shit console hardware. If anything the media let Microsoft get away with it for far too long last year.
...I can't fault MS too much because they have the best console on the market, with the largest selection of must have games and hands down the best online service. I own a first day XBox 360 and it's been happily running for over two years because I had the foresight to buy the external fan. Meanwhile my PS3 collects dust and I haven't even bothered with the biggest gimmick in electronics history...the Wii.
It must be rough on the poor little Xbots after Zonk got kick off Slashdot. No more daily barrages of anti-Sony/PS3/BluRay stories.
What a bunch of fucking losers. No one wants your piece of shit gimped and wimpy console. Keep buying replacement 360 retards, maybe you'll be able to barely outsell the first Xbox marketplace flop.
im wondering if those cheaps units are the flawed remanufactured ones.....nahhhh...those are financed by those pesky vista licences sold throuhg OEMÅ
I must be... when did Apple start making a console?
(...and when you get done showing me that, someone show where the other three horsemen of the apocalypse are?)
(yes, I own a Mac. It ain't exactly a popular gaming platform...)
Quo usque tandem abutere, Nimbus, patientia nostra?
...if I lived in Japan that might be ranked as insightful.
The right thing they did was launch early before the PS3, which gave them a big lead, which led game makers to give them juicy exclusives.
The wrong thing they did was launch early, which led to hardware problems which (reputation wise) will dog the system to the end of its days, leading for most game makers to also develop for at least the PS3.
Note the trouble is the thing they did wrong is the thing that makes the most difference long-term.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
For most people shipping costs are in fact free. The replacement process is not without hassle -- I had to request a box 3 times before actually getting one, though you could legitimately blame their shipping company for that -- but the whole thing never cost me a dime, and I had my '360 back within two weeks of sending it off. I live in Canada; I don't know how it is overseas, of course.
(For reference, the process is this: you call their toll-free line, spend about 10-20 minutes going through an automated system and then waiting on hold, then talk to a person for a few more minutes. A couple days later there's a box on your doorstep, which you pack up and send off at no cost. A week or two later the console comes back fixed. They'll do this for any '360 purchased ever, if you have RROD -- I worked on a "launch window" title and had one I got on launch day direct from MS.)
TFA says that that Xbox 1 has 90% yields from start to finish. How surprising is that? MS simply built a practically industry standard PC. It had a hard drive, an Intel processor, an NVIDIA chip, a DVD-ROM and a power supply. These components were so standard, time tested, and widespread that combining these components into a machine with high yields was child's play. Add to that, the fact that MS was willing to hemorrhage cash with some presumably going towards for build quality on each unit sold, and it's no wonder the Xbox 1 was reliable. What's more, the PCBs and heat sinks had plenty of open air around then to encourage heat dissipation and removal through the fan at the rear.
Many people complain about how incredibly hot their electronic devices become during use, and laptops get the most complaints. Why? Because everything is packed into a nearly air-tight space, hampering heat removal. The 360 designers sabotaged the 360's reliability by building a small and sexy machine that can't dissipate heat from the internal components fast enough to keep the running reliably.
The 360 designers dug themselves a deeper hole by rushing unique hardware elements, in contrast to the Xbox 1, which had industry standard components. Intel had its Celeron's for the Xbox 1s "dialed in" at its factories: yields should have been in the nineties. Likewise, the SDRAM chips were industry-standard, along with the DVD drives. As far as I know, the NVIDIA GPU was neither new nor groundbreaking. Microsoft commissioned IBM to build a custom chip--who's IP would be owned by MS, so no skin off of IBM's nose if the custom processor failed due to MS's unrealistic usage in production--based on a fledgling microprocessor technology. This was a big risk that hasn't paid off because the 360s physical dimensions seem to belie an overly optimistic idea of heat production from the CPU. With the Xbox 1, any veteran engineer could say, "Look, here's a Celeron, here's its heat production, we NEED a heat sink of such and such size, we need open space around it, and this much airflow." With the custom 360 CPU, engineers may have been afraid to speak up about the thermal requirements because the CPU was so new and unfamiliar. Then, there's the ATI GPU, again custom. MS went ahead and crammed it into the system while telling themselves it wouldn't overheat, would perform admirably, and, if not, they could make it work reliably. Well, they should have been more cautious and properly spec'ed and tested the GPU. After taking the time to test and establish the GPU's operating conditions, only then should they they begun design on a case that would be small and still allow adequate heat dissipation.
In the end, the Xbox 1 was a great console because of three things: one, MS didn't innovate: they simply built a Wintel PC based on reliable, time-tested, industry standard components. Two, MS used its position in the software market to cover its losses for producing a high-powered, high quality PC. Three, MS built the Xbox 1 with more regard for function than form. The case was huge, but was great for thermal management.
It's called "dumping" when it's done by someone you dislike, and "loss leader" otherwise.
For the politically unconnected company, there are three pricing models, all predatory:
Dumping - lower than competitors
Ripping off consumers - higher than competitors
Cartel - the same as competitors
"And it is not rocket science to design a game console."
Rocket science? No! But it's harder than you think to bring conflicting goals down to an economic level the majority can afford. Featuritus didn't help.
"Of course, we must acknowledge that MS tried to design custom hardware, a task for which it has no experience. "
Funny, the main two parts that caused most of the issues were from companies that had the expertise (IBM,ATI).
"What people fail to realize is that IBM spent the money to make rock solid products. "
You didn't read the article, did you? The yield on the new IBM processor was hardly "rock solid".
"The IBM PC was bulletproof. "
IBM PC original power supply problem (long)
Shai Schticks:"You don't make peace with friends, you make peace with enemies"
Just like the ps2.
The could have made it smaller, with laptop HD, and external PSU. Still sold millions to cheaper markets and poorer people and still sold tonnes of great games and made it work with the new wireless controller too.
So they didnt like nvidia, but they could have worked out a long term deal,not just cut and run.
I guess never again will nvidia make deals with MS.
Liberty freedom are no1, not dicks in suits.
The difference here is that the Xbox cost them a huge amount of money (I don't think they ever made a profit off an Xbox sale), and did not benefit from integration of parts. For instance, one of the most acclaimed bonuses of a 360 (by developers) is the integrated memory (I'm not a hardware engineer, so if I'm off here, correct me). The fact that the memory can be used both as video ram and standard ram allows for serious optimization benefits.
Just throwing together some PC parts doesn't make it better. It may be more reliable and save on R&D costs, but a console like a PS3 would blow a PC equivalent (512mb RAM, 6800GT, let's not talk about the CPU) out of the water. In the console market, you have to build a "console" and not a PC, otherwise you'll never bring down the cost sufficiently, and it won't have a very good lifespan (graphically).
The only thing it reveals to me is that you are probably a conspiracy theory nutbag.
The day of such a price cut probably is a good day for a bit of a retrospective.
What would you prefer? That they only reported the price cut? I don't see why simply regurgitating a press release would be the sort of reporting we should wish for.
Boffoonery - downloadable Comedy Benefit for Bletchley Park
... is a new Xbox 360 logo.
And I'm sure those $200 cheap Xboxes aren't all refurbished red ring casualties. Not all of them.
http://rocknerd.co.uk
I didn't see any anti-dumping petitions for Kia's Buy One Get One Free event. Didn't notice any powerful lobbies in opposition either. But then, maybe that's why the Big Three are in such dire straits right now.
(sorry, I couldn't resist!)
I must be... when did Apple start making a console?
First there was Pippin. Then there was the wii little Mac mini.
When talking about Microsoft and it's business areas people often seem to completely lose perspective.
Whilst Microsoft has a monopoly in the operating system market it's worth noting that despite this, on a global scale Microsoft is hardly one of the biggest players. Even Sony, it's main competitor in the console market is worth around $120 billion vs. Microsoft's $80 billion.
The point to take away from this is that Microsoft needs to buy into these markets because they're already dominated by other monopolies, or conglomerates of companies that are essentially monopolies. Microsoft isn't even close to the size of many of the big financial institutes, or many of the oil companies, but that's what a company dreams of being, and to do so Microsoft needs to extend the areas it is strong in, it's expertise is in technology and if other technology areas are already tied up then the only option is to buy their way into these areas. Quite why you see that as a bad thing however I'm not sure as the only reason a company would need to buy into a specific area in the first place is because another company or group of companies already have a monopoly there!
Would you suggest it was a bad thing if an alternative OS vendor bought their way into the operating system market by paying the likes of Dell to offer their OS as an option?
Regarding the shareholders, they don't mind, because the profits across the company are high and whilst the 360 doesn't currently have much more penetration into the console market than the last generation XBox, it's still early days- console numbers go up when console prices go down to a point where it's an impulse buy. To be at the stage of the last generation XBox when the console is still fairly pricey. More importantly though their main competitor Sony isn't even close to the sales of their last generation so there's certainly clear progress being made all round and that'll be enough for the shareholders. If Microsoft can continue the trend through to the next generation and beyond then they will attain market dominance over Sony, certainly the blow they've struck this time is a damn good start for them. If I was a shareholder I really wouldn't be worrying as the future is fairly bright whilst the company overall is still extremely profitable and doing well to extend into other areas.
People can hate Microsoft all they want, but at the end of the day not liking them doesn't change the reality of their financial and business situation. They're still making a lot of right moves and ever fewer wrong moves.
Big company releases defective product to get a foot in the door. Hardly anything new?
Typical of Microsoft, thinking of themselves rather than the people who have to use their product.
Incomplete when reaching the market and let the client base do the beta testing. I think Visual Studio is their best product. Still, Microsoft make really good mice and keyboards that even work under Linux, so credit where credit's due.
My ism, it's full of beliefs.
The real issue was MS deciding to design, and therefor own, the chips used in the 360. Even a seasoned hardware manufacturer like Sony wasn't stupid enough to take that on, they partnered with IBM to do most of the heavy lifting. They are a software company, and developing software is very different from manufacturing chips.
The article sure made it sound like the classic case of marketing making too many early decisions, as in picking a small curved case, then forcing engineering to figure out how to pack it all in.
I'm still pissed that they kneecapped this entire cycle by releasing a console without a hard drive for cost purposes.
//TODO: Insert catchy phrase
yea, sure, as long as you don't have monopolies.
Not sure of the validity of this claim, but an EE friend of mine claims to work with an ex-Microsoft Xbox EE. The story goes that supposedly Microsoft has an "in-house software only" policy with regards to all product development. However, an industry standard production management software package, which I can't for the life of me recall the name of, was being used at the very beginning of the 360 production process. Once the big wigs at MS discovered this, they demanded that the production software be changed to a Microsoft-created alternative....and the rest is history.
No idea about the validity of this story, but there you have it.
It's called "dumping" when it's done by someone you dislike, and "loss leader" otherwise.
For the politically unconnected company, there are three pricing models, all predatory:
Lower than competitors - Dumping
Higher than competitors - Ripping off consumers
The same as competitors - Price fixing
Most XBox 360 consoles before the recent hardware changes will die with unreasonably short lives. It's just a matter of time. It's a design flaw, not a manufacturing flaw.
i was also amused at the coincidence of this article hitting the actual day we finally broke down and bought a 360 (mainly in anticipation of rock band 2). keeping us away from the 360 until now had been price, a dearth of games that interested us (i used to be all about the fps, but no more) and the RRoD problem. i had asked a friend, about a year ago, about the issue and was astounded to learn the failure rate was in the double digits (i think he said it was around 13% back then). my faint hope is that, by waiting until this most recent hardware release, we're less likely to encounter the issue. have there been real changes made, or am i just living in a land of candy canes and fairies?
soupy twist
Someone mod this up. Aside from some formatting issues, this comment is a great explaining of why dumping would ever happen, and why it can be anticompetitive.
For starters it's not sold. If it were sold you could do what you want with it, mod it to your particular desires, run what you want on it. As it is, it's like buying a record or CD player from one of the 4 big music companies and finding out that it only plays records/CD's from that company, which they sell you at immense profit!
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
I do not like Microsoft as a company for this reason. They have a history of releasing products that have great potential but too many defects and high failure rates. They rush something out the door stuffing sh&% into stores before it is ready. I like the games for the Xbox 360 and its capabilities are still pretty good among the current generation of consoles. However, their reliability record is unacceptable both with the Xbox 360 and with Windows. My next computer will be an Apple. Thanks a lot Micro$oft. Focus on Office and development tools like Visual Studio that are brilliant instead of trying to sell crap like Windows and Xbox 360.
If the Wii didn't exist would MS have sold several million more 360s? Of course they would.
Maybe - but note that I am not interested in either PS3 or XBOX - but I sometime do look at Wii with interest.
So it not the same market - it's an overlapping market, yes - but not the same. Because there are current and potential Wii customers who would have bought nothing at all if Wii did not exist.
Martin
Because when you see it you turn 360 degrees and walk away.
Intercooler: $14 at your local gamestop.