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Why Microsoft Got Into the Console Business
An anonymous reader writes "Joachim Kempin, former vice president of Windows Sales, has explained how the original Xbox came to be. It turns out it was Sony's fault, simply because the Japanese company wasn't very friendly towards Microsoft, and Microsoft eventually decided they had to 'stop Sony.' Apparently, long before the Xbox was even an idea, Microsoft was trying to collaborate with Sony in a number of areas they thought there was overlap. That collaboration was sought before even Sony had a games console coming to market, and would have focused on products for the entertainment sector."
About Bill Gates throwing a fit in front of Sony because they refused to put his garbage software on their hardware. Also not that while Xbox is profitable for Microsoft, it is not considered profitable enough.
They made their own worst enemy. Again.
It was pretty well agreed eight years ago that the living room was a possible avenue for a "Trojan Horse" that would take over as the household computing center and push aside the consumer PC. And Bill Gates was always paranoid about competition, not just established players in personal computing like Apple but also new entrants large and small. That's why MS got into so much trouble with the anti-trust regulators in the '90s. Sony didn't want to make some sweetheart development deal with MS... so what? Sony was big and powerful, and some of the last companies that made the mistake of trying to buddy up to Microsoft were IBM (with the original PC) and Sybase (with SQL Server development for Windows). Jerry Kaplan wrote about his own close encounter with Bill Gates in his book "Startup" (Kaplan demo'd the Go tablet computer for Gates and Jeff Raikes, hoping to interest them in application development; instead, Gates turned around and launched the Pen Windows project. Guess who was put in charge? Yup. Jeff Raikes).
As usual, Steve Jobs got it right... the game console wasn't going to be the centerpiece for consumer technology. It looks so obvious in retrospect.
Reasons to get into business #32:
Spite.
Science advances one funeral at a time- Max Planck
Thats hilarious, because the playstation originally came about from sony and nintendo trying to partner up, and nintendo breaking the deal because of arguments about money. Sony was so mad they created the playstation to rival nintendo.
As a long time user of linux, I have to say that I also enjoy Windows for the moments when it is appropriate. Same for OS X. There 3 amazing accomplishments of the human mind. And should be celebrated as such.
I think Sony made the right decision there. If Microsoft approached me about "co-operating" I wouldn't touch them with a 10 foot pole. Look how well it worked out for IBM (with MS-DOS and OS/2) or Sun (with Java).
I don't care if it's 90,000 hectares. That lake was not my doing.
Microsoft is predicted to get out of entertainment business because it was Microsoft's fault.
http://games.slashdot.org/story/13/01/21/1637209/will-microsoft-sell-off-its-entertainment-division
The one thing Microsoft actually does decently and now they may have to sell it off because of Windows 8.
Of course, if Microsoft were competent enough to do that, they wouldn't have actually needed to stop SONY in the first place. Anyway, SONY did a pretty good job of stopping SONY, with or without the involvement of Microsoft operatives.
I'm trying to teach myself to set people on fire with my mind... Is it hot in here?
Unfortunately, that's also the reasonining behind a number of open source projects.
There's no -1 for "I don't get it."
Given MS's strategy of Embrace, Extend, Extinguish, it's obvious Sony made the right choice.
In all honesty, why would any hardware vendor want to tie themselves to a platform over which they have no control? Look at how MS throws around their desktop hardware partners, dictating to them which minimum and maximum hardware requirements the system can have. No doubt they would try to pull the same shenanigans with Sony. And then look at how MS blames its hardware partners for crappy Win8 sales when it's really fault for designing the OS in ways that no consumer ever wanted? And then there's the atrocity that's Windows RT, and how nothing runs on it!! I'm guessing that there isn't a single hardware vendor on the planet that wouldn't love to never have to deal with MS again, were it not for their desktop monopoly... probably even MS itself!
It's not unreasonable that Sony executives made the simple observation: companies that entangle with MS never do well. Seriously - for each and every company that MS has partnered with that's doing decently, you can name 5 that are in the gutter or dead altogether.
At least MS did a better job with the Xbox than they did with WinMo. That's not saying much, but hey, when you're Microsoft, that's really all you've got...
I have left slashdot and am now on Soylent News. FUCK YOU DICE.
... because Nintendo screwed them. Nintendo and Sony were jointly developing the CD add-on to the SNES (with Sony also building a combined SNES/CD machine named the Play Station). However, Nintendo dropped a bombshell on Sony at the '91 CES: they were severing their ties with Sony and instead partnering with Phillips to develop their CD technology.
Xbox sucks. One must own a Gold membership (about $5/month) to install many key applications, such as Netflix (for which a paid Netflix subscription is required, of course). And whenever an update is available, refusing to install it immediately will close the Live session, preventing any access to Netflix. This is hugely annoying as those pesky updates frequently happen at the least convenient time.
They really do milk the customers. I bought a 1-year Gold membership but I probably won't renew. Unfortunately the alternative (Playstation) is not that great.
lucm, indeed.
While xbox has recently had profitable quarters, over all they are still down several billion after two consoles. Sony has made money on all 3 playstations long term.
Considering the fact that the PS3 couldn't even do background downloading at launch says more about Sony's arrogance than Bill Gates' (if the story is true) temper.
I always thought it was because Sega failed with the Dreamcast. Sega had worked with Microsoft for 2 years for the OS on the Dreamcast. So I assumed Microsoft decided to go on their own with out Sega.
On the other hand, Nintendo made its own worst enemy by dropping out of the "Play Station" (with a space) partnership with Sony to make a CD-ROM drive. The Play Station would have plugged into the clock port on the bottom of the Super NES using the HANDS protocol (Nintendo's version of Blast Processing). The trouble is that HANDS couldn't copy information directly into video memory; instead, it had to be bounced off the CPU's memory, and that couldn't be done full-screen at a solid 30 fps. So Nintendo dumped Sony for Philips CD-i, and Sony began the PS-X (PlayStation Experiment) project to rework what it had left into a stand-alone console.
In the Harry Potter universe, on the other hand, it might be the case that the Play Station accessory for Super NES came out on schedule, which explains Dudley Dursley having a Play Station in mid-1994 rather than the real-world release date of the late third quarter of 1995.
While xbox has recently had profitable quarters
That started 5 years ago, they've had 20 profitable quarters.
over all they are still down several billion after two consoles.
citation? Lots of people say this but nobody ever seems to back it up with any evidence, I'm genuinely interested to know how much has been spent and made over the life of the 2 xboxes.
However, Nintendo dropped a bombshell on Sony at the '91 CES: they were severing their ties with Sony and instead partnering with Phillips
Are you sure it wasn't a lamp oil-shell or rope-shell? This is what became of the partnership with Philips.
Because they don't make a single dime off PC games, even though they are all on their OS.
I know there are a lot that will disagree, but I honestly feel that MS has at least "mostly" learned their lesson. Sony? leaks customer data like there's no tomorrow. DMCA? Bastards fought tooth and nail for it, then have wantonly violated it with rootkits to "protect" their music CDs. Where's the public outcry on that? Where's anonymous? I could go on, but, I think these very few points suffice. Feel free to add on or disagree.
Why would Microsoft care that Sony was releasing the Playstation? How was this any different from the N64, or the Sega Saturn being released in the same generation? The article only mention "Microsoft" saying that they had to stop Sony, that's just a comment from one person and I doubt this was the sole motivation or even the motivation for Microsoft to get in that business to begin with.
They wanted to stop Sony from what, creating one of the best console, the Playstation? Hopefully, we'll know more when the full interview is released on Friday. Right now, it just feels like hearsay.
So you mean that the PS2 could have suffered from BSoDs AND never ending Disc Read Errors!? Why wouldn't we want this?
The jerks have already extorted everybody into using fat and ntfs for storage chips on their devices. You cannot bring out a digital camera and use anything other than fat or ntfs, you cannot use a thumbdrive with your smart tv with any other format than fat or ntfs. If this is not unbridled enterprise extortion then I do not know how else to describe it.
Basic economics. They *could* have gone to the effort of developing their own format, collaborating with all the other device manufacturers to all use the same one and getting it standardized but the more cost-effective measure was to just license one that Microsoft had already created. I don't think you understand capitalist corporations, they don't just spend time and money to create and standardize open formats when it's more cost-effective not to, the lawyer fees alone would cost a small fortune and there is no payoff. Creating a multi-industry collaborative group to build something like that, or to create it alone and give it away to the other industry players is not beneficial when they can just license something that already exists.
I believe Sony got into the gaming biz cause of Nintendo. History repeats itself.
Call it spite, if you like.
If millions of users need an app, or a functionality, that is only available at prices up to ten thousand dollars per seat - you can expect an open source alternative to spring up, sooner or later.
Yeah, call it spite. Or, you could say, "It's the economy, stupid!"
If it can be demonstrated that people can teach an animal to roll over and play dead, should everyone in the world who wishes to do so have to pay ten, fifty, or maybe a thousand dollars to the guy who figured out how to do so?
I say no.
In the case of Microsoft, they taught computers how to blue screen and play dead. I'm not willing to pay for that privilege, thank you very much. Ditto with Autocad, Dragon Naturally Speaking, and the hundreds of other useful things that a person can do with a computer. My computer serves ME, not some faceless corporation amassing unmeasurable fortunes in offshore accounts.
Open source for the win!
"Windows is like the faint smell of piss in a subway: it's there, and there's nothing you can do about it." - Charlie Br
"Cooperate with us or we will crush you". Geez I wonder why Sony would ever give such a cold shoulder to such a friendly gesture?
Way to totally not get a fucking joke.
Why would Microsoft care that Sony was releasing the Playstation? How was this any different from the N64, or the Sega Saturn being released in the same generation? The article only mention "Microsoft" saying that they had to stop Sony, that's just a comment from one person and I doubt this was the sole motivation or even the motivation for Microsoft to get in that business to begin with.
They wanted to stop Sony from what, creating one of the best console, the Playstation? Hopefully, we'll know more when the full interview is released on Friday. Right now, it just feels like hearsay.
Because they knew it could easily be made to go on the net have a browser, hell even do email if Sony chooses and in doing so completely usurp the new windows media pcs that HP and others were pushing with Microsoft software at the time.
This is the real reason why Microsoft released a console, they knew even back then it was only a matter of time before high speed net devices would compliment cable tv in peoples living rooms.
They are still desperate to get a foot hold in the consumer living room, but Busy-Box and the Linux kernel on smart tvs is kicking their ass in this respect.
Do not be at all surprised if next year a Microsoft branded Smart TV is suddenly announced. This is the only step that could potentially put them into peoples living rooms. I would not at all be shocked if they did the same thing they did with the Xbox and peddled it at a loss just to get a foothold in the market, seeing that they are again about 3-5 years late to the party.
Releasing a competing product to usurp a potential competitor is the only way Microsoft operates, they have never truly created anything new or innovative. Their specialty is taking others ideas and using software dominance as a lever to strip off the competition. This goes all the way back to Lotus, OS2, Netscape, the list is endless and the history of their abuses is well documented, so yes Microsoft saw Sony as a target and Sony was smart enough to tell them to go take a hike.
As much as I hate the assholes at Sony and their minions at the RIAA, I cannot blame the assholes for standing up to the assholes in Redmond.
All Microsoft wanted to do was Embrace Sony.... and after that Extend them into new areas....
There's a third E in that but I don't remember what it stands for...
"MIT betrayed all of its basic principles."
That's the problem with your average open source zealot, they aren't very good in social matters. That's why there is so much arrogance and hostility towards their own users when questions, bug reports or suggestions arise. It's also the reason that no open source project has ever been successful without the help of a large corporation.
It's true, and I think it first really hit home with most people when Business Insider posted their "Microsoft Operating Profit By Division" chart about 3 years ago. Since then the XBox group has had some profitable quarters and some losses (a big one last spring), but is still down a couple billion. If you're "genuinely interested" in the exact amount, just open Excel and type in the numbers from all of Microsoft's quarterly reports for the last decade to get an exact amount-- the numbers aren't secret.
E pluribus unum
If cant join em, beat em. Or so they tried, and kinda failed.
I always assumed it was just a case of Microsoft playing to their core competancy. I mean, all the *NIX geeks i grew up around always referred to MS-based machines as toys. :)
This little piece of gaming trivia only seem to get barely mention when you read articles about the early history of Metal Gear, but there was a computer/console called MSX and Japan and a few other places. It was Microsoft's (of Japan) attempt to pull a 3DO before 3DO did. Apparently it was successful everywhere but the US. Sony was one of the companies that made a system that ran the OS.
To be clear, that chart lists "Entertainment and Devices" division, of which Xbox is but one product, the others being Windows Phone, Surface, all MS Hardware, and other things. So it's not quite as easy as saying "xbox is losing money for MS" unless you can actually break that out of the rest of the division.
As described in the book "opening the xbox", it worked on Bill Gates nerves that sony was to powerfull in the living room and it could use its weight to influence what became new standards in the living room. Look at the DVD for example how the ps2 accelerated the adoption of this format. Microsoft dream is about Microsoft everywhere
The same thing happend with blu ray that totally destroyed microsoft hd dvd push. The xbox never has been about gaming and I'm even sure that for the next xbox the focus will be also bigger on non gaming capabilities.
The irony of the whole thing is that the xbox seriously weakend their windows platform as it weakened the argument "I need windows because I want to game"
The two situations are so different. Sony was a hardware developer, and put a lot of time and money into a project that Nintendo pulled out of at the last minute. They took all the time and money they had put into the development, and made their own console.
Microsoft wanted to put windows on the goddamn Playstation. Sony, for incredibly good reasons, said no, (if MS made the OS for the Playstation, I would not be using it; as it is, I avoid the Xbox like a plague). Microsoft had a tantrum, and they only view companies two ways:
1) companies that work with them, which will soon enough be completely subsumed and submissive to them, also, they will take the blame if the product doesn't make enough money, and
2) companies they are going to use their monopolistic power to put out of business, even if they weren't in the same field to begin with. They tried their damnest to make the PS3 a flop, and failed miserably.
Who in their right mind would want to have anything to do with MS?
So MS enters an industry, purposefully destroys the competition, and leaves the entire industry in ruins, with nobody competing to sell the best product but only to stop the others. I'm surprised that MS gets as much credit as it does around here.
And you could say that Valve is getting into the console gaming business with Steam Box because of Microsoft (although blaming that entirely on Microsoft is questionable and ignores other variables, but the point is there on a surface level). History repeats itself indeed.
no open source project has ever been successful without the help of a large corporation
Heh... wait... were you serious?
Just because a large corporation uses something, does not make it "theirs".
Linux, bittorrent, tcp/ip, html are just a few examples that have nothing to do with corporations in their inception.
About Bill Gates throwing a fit in front of Sony because they refused to put his garbage software on their hardware. Also not that while Xbox is profitable for Microsoft, it is not considered profitable enough.
It might be making profits now (as in bringing more than current expenses), but it still has a LONG (5? 6? billion dollars) to go.
Who logs in to gdm? Not I, said the duck.
And you could say that Valve is getting into the console gaming business with Steam Box because of Microsoft (although blaming that entirely on Microsoft is questionable and ignores other variables, but the point is there on a surface level). History repeats itself indeed.
I see what you did there...
The GP wrote:
"Unfortunately, that's also the reasonining behind a number of open source projects."
You replied:
"Call it spite, if you like.
If millions of users need an app, or a functionality, that is only available at prices up to ten thousand dollars per seat - you can expect an open source alternative to spring up, sooner or later."
Your comment is valid if we take the GP's post to refer to opensource as against expensive proprietary software. My own reading is that the GP was referring to two competing opensource projects, or maybe one dominant opensource project that some developers have decided to fork. There are many recent examples of this. The Gnome 3 desktop springs readily to mind, with competing groups of opensource developers trying to put out their versions of what they think is the most user-friendly desktop environment since ... Gnome 2!
>Linux, bittorrent, tcp/ip, html are just a few examples that have nothing to do with corporations in their inception.
And all of these owe their current success to large corporations, primarily Intel.
There was an April, 2007 article written by analyst Roger Ehrenberg called "When Will Microsoft Own Up To The Xbox 360 Bomb?". Essentially, he ran the numbers for the divisions of Microsoft where they'd stuffed their console business, and determine they'd invested over $21 billion (at that time) in the console business, and had earned a whopping $5.4 billion of cumulative operating losses in return. That didn't fully account for the Red Ring Of Death either, which apparently cost them another $1 - $5 billion.
They have had profitable quarters since then, but as far as I know they haven't come anywhere close to earning $26-$30 billion just in order to break even on their investment in the console business.
Consoles have been a money pit for Microsoft.
Worse, in order to remain competitive with Nintendo and Sony, they're going to have to sink billions more into the next-generation of consoles if they want to stay in that business (and pride pretty much dictates they have to stay in that business).
It's likely they'll never break even on their investment. They may have blocked Sony or Nintendo from becoming the de facto home entertainment hub, but it isn't clear to me that keeping their options open in that space has been worth close to $30 billion. There's also the considerable threat that Apple will waltz into that space with a compelling new offering and blow most everybody else out of contention (while spending far less than $30 billion to do it). Google and Amazon are disruptive threats as well in that space.
Ironically, Apple spent far, far less than $30 billion developing the iPod, iPhone and iPad, combined - a combo that's proven a money machine for Cupertino almost since the day the products were released into the market. Each one of those products could have come from Microsoft - they were certainly years ahead of Apple at one point when it came to smart phones and tablets. Redmond took their eye off of that space while chasing the console business, a decision which I think will go down as one of the biggest misallocations of resources any corporation ever made.
It would make sense not to put MS' crap in your hardware so if that's the case Sony was wise. But I think the reason for the Xbox is because all of MS' set top box and PC in the living room ideas went tits up. So rather than appealing to adults they decided to pander to children. I'm not sure would have made much of a difference in their attempt to grab control of living rooms.
(form letter)
Partner with us or WE WILL CRUSH YOU!
Have a nice day.
Steve Ballmer
CEO, Microsoft
Sleep your way to a whiter smile...date a dentist!
At least you're honest that you write shit software.
Citation? With the accounting vortex surrounding the RROD replacement problem approaching the reality-warping equations of the Starship Bistromath, we'll never know exactly how profitable, if at all, the XBox division is. Too many fungible parts. There's no way to tell, but reason to suspect that the GP is correct. Or not.
Doesn't matter, unless you own stock.
Apple, Google and Amazon?
There's a guy at the door says his name is Gabe Newell and he's got a comment to make.
Funny, Gabe himself considers Apple a bigger threat to the upcoming Steambox than either Microsoft or Sony.
But even so you may be half right, Valve will probably be a threat to Sony and MS as well.
Yeah, Apple will come along with the Pippin 2 and simply dominate! LOL!
About Bill Gates throwing a fit in front of Sony because they refused to put his garbage software on their hardware. Also not that while Xbox is profitable for Microsoft, it is not considered profitable enough.
Because Sony has an excellent reputation for fantastic software, right?
lol Zune
Dreamcast.
Linux, bittorrent, tcp/ip, html are just a few examples that have nothing to do with corporations in their inception.
Inception != Success. And do not underestimate the contributions of big corporations to open source. The original premise is not without merit. Big corporations have been instrumental in the success of most if not all major open source projects. The only way you can claim that big companies have nothing to do with these technologies is if you are willfully blind to the facts. Just because the big companies are not always the ones that start these projects doesn't mean they aren't important to the success of the projects.
Linux was started as a project by one guy but have no illusions that it would have gotten where it is without the help of big corporations and the talent they possess. Need proof? How about pretty much every major tech company including Red Hat, Intel, IBM, Novell, Microsoft (yes Microsoft), Texas Instruments, AMD, Oracle, Nokia, Google, Samsung, and a whole bunch more having made significant contributions to the linux source code.
HTML was started at CERN which is a pretty big organization (effectively a non-profit company) and would not have gotten to where it is without the help of countless companies. TCP/IP was heavily influenced by Xerox PARC as well as IBM, AT&T and DEC not to mention DARPA. AT&T developed the TCP/IP stack for unix and put it into the public domain.
there never was such a thing as "Blast Processing."
As far as I can tell, "Blast Processing" was Sega's marketing spin for the DMA unit in the Genesis, which allowed large copies to video memory without the CPU overhead of a software memcpy. The Super NES had a DMA unit of similar capability, just not marketed as such.
Fast scrolling just means you update your horizontal position by larger increments
Fast scrolling also means you need to copy the newly visible part of the map into video memory. Without DMA, there's a practical speed limit on this aspect of scrolling. DMA makes the copy so fast that a whole screen's worth of tile indices can in theory be updated at a solid 60 fps on both the Genesis and Super NES. That works well for platformers and other games using a tiled background plane, but full-motion video needs a whole screen's worth of pixels copied, which takes a lot more video memory bandwidth.
Consoles have been a money pit for Microsoft.
I would agree that historically that was true. But ever since they start experimenting with the 'Metro' dashboard on the xbox, it has been stuffed with Adverts.
I'd have a hard time believing the xbox team is still in the red.
http://penny-arcade.com/report/editorial-article/ads-up-games-down-the-ugly-profitable-truth-about-xbox-live-advertising
I think you should check out this thing called the playstation 3. It's a complete and utter dismal failure monetarily and really really really was a horrendous idea that made investor money run at the sound of 'playstation 4'. Wait you think they edited their roadmap for releasing the ps4 because the ps3 was 'successful'? Not quite, their shit got pushed back so hard when the ps3 became an utter fuckin shitstorm.
Balmer's biggest weakness is that he's all about the kill. He'll spend billions to enter a market and crush the competition, then walk away without doing much to monetize it.
We can stop all this if we can just get Nintendo to do something spiteful because of the Steam Box!
#naabhaprzrag, #sverubfr-000, #agi-fcbafberq, negvpyr[pynff*=' negvpyr-ary-'] { qvfcynl: abar !vzcbegnag; }
Reasons to get into business #32: Spite.
That explains a lot about (some of) their software.
Microsoft was telling Intel Corp. how to design their CPUs in the 1990's even before Intel went compressed and hired Sweet that bent CPU leads to stay ahead of the other 3 shifts.
The very first Electronic Entertainment Expo, held in LA (at the Staples Center if I recall correctly), had the Sony and Microsoft booths next to one another. (MS, if I recall was squeezed between Sony and Sega) Sony's was HUGE, as they were at the time, pushing the Playstation (which wasn't even out in the USA yet, but had been released in Japan). Sega had already released the Sega Saturn and was pushing some 3-D dragon game (forgot the name).
MS's booth, was not so big, they were showing flight simulator and a few other entertainment packages for the PC. MS, used to being the biggest player at any PC/computer show, was not used to being dwarfed by the behemoths of Sony, Sega, and Nintendo.
When Sony ran an entire Marching Band through MS's booth (and around the entire show), I think MS had had enough and decided then and there to get into the Console Biz.
If telephones are outlawed, then only outlaws will have telephones.
I'd be more worried about Valve and Steambox.
Microsoft's garbage software uses way less RAM than Sony's OS on the PS3. One of the chief complaints I hear from PS3 developers is how much more overhead there is from the PS3 OS compared to the 360.
with the steam box from valve there will probably be no used sale market since there is none on steam on windows/mac/linux at present. microsoft eliminating used sales for their console would give a big boost to the steam box by removing a big differentiator, esp. if potential purchasers of the steam box are used to steam sales and think the steambox will have similar.
of course, if microsoft and perhaps sony go down the no resale route, and valve went in the other direction and actually came up with a system of selling your steam attached games to other steam users, maybe taking a cut of the sale; then which console would you buy? i hope valve introduces resale, there's no reason it couldn't introduce an experiment in resale, a trial period with clear terms & conditions upfront and see what happens, compare it's income before and after. that way the discussion over resale would have some actual evidence brought to it :)
Reasons to get into business #32:
Spite.
Its worked for a ton of companies. Lamborghini comes to mind.
YNokia could be the next victim of that "cooperation".
Could?!? It's already happened.
Thank the heavens above for Sony refusing to mate with Microsoft. Sony would have died just like every other collaborator of Microsoft.
I think you'll have a hard time showing that spite is what made those projects successful. (Only the successful projects matter.) And really, most of the spite and hate comes from minority users who happen to be loud mouthed on the internet.
obligatory http://xkcd.com/927/
That Microsoft didn't like how another company was doing business...
I haven't thought of anything clever to put here, but then again most of you haven't either.
Consoles have been a money pit for Microsoft.
Worse, in order to remain competitive with Nintendo and Sony, they're going to have to sink billions more into the next-generation of consoles if they want to stay in that business (and pride pretty much dictates they have to stay in that business).
MS's loss is our gain. I think MS's competition has kept Sony and Nintendo on their toes in the console market and improved the options available to gamers.
Though I wouldn't mind if more of the XBox game library was available on the PC ...
Is it so weird that a corporation with excess capital will enter an entertainment market tangentially related to their core technology market?
More curious than Microsoft's entrance into video games is perhaps Nintendo's. Apparently Nintendo just got tired of printing hanafuda decks and expanded into electronics and eventually entertainment electronics.
More Twoson than Cupertino
"Troll" mod - seems like a mistake. OOOP, was hardly a joke either ("Unfortunately, that's also the reasonining behind a number of open source projects.") in that it was
a) not funny
b) semi-true
I say "semi". Actually, spite might be a great reason (fortunately, not unfortunately) for the starting of an OS project. That may not be enough motivation to sustain it, but who cares. It would be like getting in shape after being dumped or something. Maybe you never should have been with her to begin with...
I don't question the existence of spite as motive (like getting back at Tivo and their Tivoisation of OS), but I question how this is a bad or "unfortunate" thing.
A worse resolve is to hide the hatred and frustration of dealing with a company and just continuing to do business out of an unwillingness to take risks or something.
Great reply, BTW!
There was an April, 2007 article written by analyst Roger Ehrenberg called "When Will Microsoft Own Up To The Xbox 360 Bomb?". Essentially, he ran the numbers for the divisions of Microsoft where they'd stuffed their console business, and determine they'd invested over $21 billion (at that time) in the console business, and had earned a whopping $5.4 billion of cumulative operating losses in return. That didn't fully account for the Red Ring Of Death either, which apparently cost them another $1 - $5 billion.
They have had profitable quarters since then, but as far as I know they haven't come anywhere close to earning $26-$30 billion just in order to break even on their investment in the console business.
Consoles have been a money pit for Microsoft.
Worse, in order to remain competitive with Nintendo and Sony, they're going to have to sink billions more into the next-generation of consoles if they want to stay in that business (and pride pretty much dictates they have to stay in that business).
It's likely they'll never break even on their investment. They may have blocked Sony or Nintendo from becoming the de facto home entertainment hub, but it isn't clear to me that keeping their options open in that space has been worth close to $30 billion. There's also the considerable threat that Apple will waltz into that space with a compelling new offering and blow most everybody else out of contention (while spending far less than $30 billion to do it). Google and Amazon are disruptive threats as well in that space.
Ironically, Apple spent far, far less than $30 billion developing the iPod, iPhone and iPad, combined - a combo that's proven a money machine for Cupertino almost since the day the products were released into the market. Each one of those products could have come from Microsoft - they were certainly years ahead of Apple at one point when it came to smart phones and tablets. Redmond took their eye off of that space while chasing the console business, a decision which I think will go down as one of the biggest misallocations of resources any corporation ever made.
$21 billion to develop the original XBox sounds ludicrous. The only reason Apple is a 'threat' to console gaming is because somehow executives in the industry have gotten it into their mind that people are playing iPhone applets *instead* of console games. If console manufacturers/devs would simply run their companies accepting that people are trying to be healthier, are raising their kids healthier, and there are simply fewer people looking to buy/play console games.
They want to blame it on everything but themselves, but the fact they see Apple (really?) as competition means MS/Sony/Valve are really trying to make the WRONG PRODUCT.
Why Microsoft Got Into the Console Business?? Because Microsoft need to be competitive and to be ahead of their time.