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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."
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.
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.
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.
Wii? 150 bucks new. Does not do HD, but I personally don't care. Also gets hulu and amazon and has a decent youtube app. Also you can softmod it for homebrew and get wiimc and vlc shares. Also stream movies, music, pictures over wifi from your pc. And you can play some great video games. Hook up a hard drive and you don't even need to leave your couch to put in the dvd. AND no online fees. Plus it's approachable to play videogames with your girlfriend or her parents, even if they are terrible at them. Has a terrible web browser though, but that's what your ipad/phone is for. Seriously, if you don't give a crap about HD, Wii is hands down the most amazing piece of TV machinery ever.
Like Microsoft operatives infiltrated SONY at all levels of management and sent the company crashing into the ground? I think that'd be funny.
Of course, if Microsoft were competent enough to do that...
Considering what they've done to Nokia, they definitely seem capable of doing just that.
Microsoft pioneered online gaming for consoles. Before Xbox Live the Playstation network sucked. You had to hold down the square button, a face button, to talk in SOCOM 2-one of the extraordinarily few games to feature voice- and even then only one person could talk at a time. Playstation Online had no friends list, and required you to buy an extra harddrive (and hope you had the right ps2 to install it into).
Then along came Microsoft with Xbox Live. Voice chat in every game, cross games friend list, voice messages, game invites, it was crazy. For years Xbox had, basically, the only choice for online gaming. Ps2 online was crap compared to Xbox.
And you know the thing about all that is? It costs money. $50/year. If you can't pay that you probably should spend more time working and less time buying Xboxes.
As to Netflix, of course the system kicks you off for having different software than the servers. You can't wait a minute for a 20 mb download every few months?
If you own a console, Xbox Live is the best option. Speed, reliability, and even the updates are shorter than any other console. Playstation is getting pretty good (But Oh No! Playstation Plus isn't free either!), but they are always playing catchup.
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.
Did I mention graphics? I said SDK. A lot of developers have been bitching about the ps3's SDK. Even if the games look great, that doesn't mean the SDK doesn't suck.
But I'm willing to err on the side of Sony here because the notion that developers are whiny and spoiled is more attractive to me.
Non impediti ratione cogitationus.
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.