1up.com - 4 page article on advice for Xbox Next

[PC-Engine]

But anyway . Launching a year earlier would give ms an advantage .

That strategy has advantages and disadvantages, wether it ends up as one or the other depends on the circunstances. Personally I think for MS it may be more of a disadvantage, because their fanbase is built on being the biggest and most powerful. Or course they could lose their fanbase and gain a new one.. but maybe not.

If MS doesn't adopt HD movie playback then a portion of the market will view Xenon as it did DC which couldn't play DVDs. PS3 with HD movie playback right out of the box may make Xenon seem less attractive. However since Xenon's gaming graphics won't be too different from PS3 or Revolution down the line, it won't lose as much momentum as DC even if it didn't have true HD movie capability. I'm pretty sure it'll have native 720p support for standard DVD movies which is good, but true 1080i/1080p non-upscaled is better to compete with PS3.

 

[cybamerc]

Home & Entertainment losses don't include R&D, advertising, shared administrative costs etc. Nor do they include the Bungie and Rare investments or developer pay-offs. Finally M$ has changed their accounting practices a couple of times during the Xbox' life. The last time they did so H&E losses increased despite the inclusion of the profitable Mac software business. PC games which are also included in the H&E segment are also profitable now. That means Xbox losses are in fact bigger than the combined result for the segment.

When you add up everything and use some good sense you realize that Xbox losses are quite significant and much larger than some people would like to think.

 

[cybamerc]

Xbox is not a financial success by any means. It is a failure if you look at it that way, but then again Microsoft never intended to profit from it for a long time.

They were planning on breaking even this year. In reality they're not even close to breaking even on production much less make up for initial investments.

So even by M$' own expectations Xbox is a huge failure.

 

[Nick Laslett]

Does anyone else think the PS2 shortage and release of PSTwo is a deliberate strategy on Sony's part to steal some of the limelight away from Halo 2?

There have been shortages of PS2 for the last 3 months and no new shipments.

The PSTwo will launch beginning of November. The $149 price point is an effective reduction as the Network Adaptor is now included.

The market demand should be sky high, with so many people unable to purchase the console and having to wait.

The redesign will garner a lot of press, the inclusion of the NA increases the value, GTA:SA's release adds a mulitplier.

What do you think? Sony's attempt to counter the Halo2 effect?

 

[pahcman]

They were planning on breaking even this year. In reality they're not even close to breaking even on production much less make up for initial investments.

So even by M$' own expectations Xbox is a huge failure.

It is still about finance....

Despite that, MS are just as committed to the Xbox and Live brand. Since MS do not seem to go the way of Sega, lets give them time before crying out failure or doom3d. Lets see what will happen next gen.

 

[rabidrabbit]

I don't think Halo 2's effect is so significant.
I don't believe they'd schedule such a big release as PSTwo based on one competitor's game.
Sony has an onslaught of big software (GT4, MGS3, GTA:SA...) and hardware (PSTwo, PSP) releases scheduled at the end of this year / at the beginning of next year.
It's more of a reaction to the hardware sales decreasing because of market saturation, and Sony rejuvenating the PlayStation brand before the big start of hyping up PS3, than reacting to a single game on such a large scale.

I don't think these big companies really schedule their strategies just on competitor releases, maybe on a big big big launch such as new gen console hardware, but not after the userbase is more or less established already.
Othewise MS would have some other big titles than HALO 2 scheduled to fight against PSTwo, GT4 and GTA:SA

 

[-tkf-]

Does anyone else think the PS2 shortage and release of PSTwo is a deliberate strategy on Sony's part to steal some of the limelight away from Halo 2?

It was a well excuted strategic move that puts them in a strong position for this holliday and the upcomming major titles. It really looks like the rest of 2004 (december) and 2005 will see a bunch of AAA titles getting released.

 

[Johnny Awesome]

Cybamerc: Your post is pure conjecture. You're making things up. The H&E division is responsible for Xbox and it's losses. It's a moot point anyway, because even $4 billion is no big deal in the grand scheme of things. If MS has 40% of the market in 2010, none of this will matter.

 

[London Geezer]

Cybamerc: Your post is pure conjecture. You're making things up. The H&E division is responsible for Xbox and it's losses. It's a moot point anyway, because even $4 billion is no big deal in the grand scheme of things. If MS has 40% of the market in 2010, none of this will matter.

$4Billion not a big deal? Jesus Holy Mary!! Then what is a big deal?

If you were a shareholder, you wouldn't talk like that.

 

[Readykilowatt]

Cybamerc: Your post is pure conjecture. You're making things up. The H&E division is responsible for Xbox and it's losses. It's a moot point anyway, because even $4 billion is no big deal in the grand scheme of things. If MS has 40% of the market in 2010, none of this will matter.

You never cease to amaze me. I wouldn't be surprised if you bought dot-com stocks in the late 90s.

Edit: Oh, and you probably bought stocks in Enron too.

 

[Tuttle]

"If MS has 40% of the market in 2010, none of this will matter."

You live in a little fantasy world. The sum of your knowledge of the console market seems to be you are a MS fan and they have a lot of money.

So you think console players are going to develop a urge for shiny green plastic and peecee ports over the next five years? Every console developer I know, including myself, is in the early stages of preparing for the PS3. The same franchises that 75+ million people wanted to play on the PS2 are in the early stages of getting ready for the PS3.

Where are these titles for the next xbox that is going to result in 20+ million more console consumers feeling the need to own an xbox?

 

[thop]

You never cease to amaze me. I wouldn't be surprised if you bought dot-com stocks in the late 90s.

 

[one]

Bill's pocket money will save Xbox in the end
Meanwhile let's watch WebTV.

 

[thop]

Bill's pocket money will save Xbox in the end

I think even Bill isn't willing to sink money into the Xbox forever. I wonder if Xbox is still part of the greater plan (to sneak in the living room and finally conquer it), because Xbox2 seems to be drifting away from that, towards a more traditional console design.

 

[wco81]

You also have to realize that MS committed to giving most of its cash back to it's shareholders.

They are going to have a special one-time $3 a share dividend payout and then going to raise the dividend thereafter.

The one time payout will cost $30 billion and they said the overall program could end up being $75 billion. Gates himself has committed to giving away the special payout because it would have been worth billions to him personally.

MS stock has been pretty stuck for the past 3-4 years, while other tech companies have seen some significant appreciation after the tech bubble. So you would think the shareholders will have less tolerance for businesses which fail to add to the bottom line and help the stock price.

Now all that said, MS is still generating about $1 billion a month to add to its cash reserves.

 

[passerby]

BTW, in case it hasn't occured to anyone yet...

CES 2005, WHERE XB-NEXT IS WIDELY SPECULATED TO BE UNVEILED AT, IS LESS THAN 90 DAYS AWAY.

Guess we'll learn a lot more than.

 

[ERP]

BTW, in case it hasn't occured to anyone yet...

CES 2005, WHERE XB-NEXT IS WIDELY SPECULATED TO BE UNVEILED AT, IS LESS THAN 90 DAYS AWAY.

Guess we'll learn a lot more than.

I'll bet it isn't!

 

[Lazy8s]

london-boy:

$4Billion not a big deal?

For a company of Microsoft's wealth, no.

If you were a shareholder, you wouldn't talk like that.

Even with the Xbox drain, Microsoft generates more pure profit per quarter than market-leader Sony's been doing in a year. Microsoft shareholders haven't been shifting their investment anywhere else in the sector considering such finances.

The company had been under continual pressure by their investors and by the government to spend their cash hoard, so the Xbox project has been viewed as constructive by the financial community for moving and gaining them share into strategic growth markets. And now with the largest dividend payout in all of history, Microsoft has more shareholder confidence and more autonomy from shareholder pressures than nearly any major company.

Xbox is a business pillar to Microsoft like MSN and is being treated as such.

 

[passerby]

BTW, in case it hasn't occured to anyone yet...

CES 2005, WHERE XB-NEXT IS WIDELY SPECULATED TO BE UNVEILED AT, IS LESS THAN 90 DAYS AWAY.

Guess we'll learn a lot more than.

I'll bet it isn't!

True, because that should be 60 DAYS, not 90.

Nevermind my ramblings.

 

[cybamerc]

I wonder if Xbox is still part of the greater plan (to sneak in the living room and finally conquer it), because Xbox2 seems to be drifting away from that, towards a more traditional console design.

Certainly. They're just going about it differently. Where the initial plan was to make Xbox 2 more PC-like they're now working on making the Windows PC more Xbox-like.