Business Approach Comparison Sony PS4 and Microsoft Xbox

[Deleted member 11852]

I'm talking about their released products. Look at how much MS spent on developing Kinect hardware, and then how little they invested in getting valuable Kinect features into every first-party title (not just waggle control, but features like facial scanning and body tracking augments to conventional games). Look how many years Sony has spent on RnD to finally release Move and then provide but a few simple games, and then forsake it with their next box.

It think this is basically a consequence of both controllers not really being thought through with practical utility for controlling a broad spectrum of game types. I get the feeling that Nintendo developed the Wiimote alongside a wide selection of game type whereas Microsoft and Sony found some very cool uses of technology and threw them out there hoping developers would come up with something. I.e, putting the cart before the horse.

Right. It's not the investment that makes the success. You have an idea, try it, and it flies or fails. But if you don't back an idea fully, you pretty much guarantee its failure.

The above, again. I think they both had ideas for alternative controllers but neither are as good a fit, for the cross-spectrum of games that sell millions, as the conventional gamepad. I think both companies took a punt. Sony have been playing around with cameras since PlayStation 2 and in all that time there have no few (any?) great camera-based games. That is great games where there was real potential if only the raw tech was better, yet Sony seem reluctant to drop it.

Move, a camera and Morpheus may all come together in a glorious new experience, though and I actually have high hopes where I was dubious of Wiimote, dubious of Kinect, dubious of Move and dubious of Kinect 2 - as competent control devices for broad selection of game types - first person shooter, third person shooter, real time strategies, driving, fighting, platforming, 2D side-scrolling etc.

 

[Shifty Geezer]

The various alternative controllers discussions have some of us tooting all sorts of valued uses for different controls, which aren't all about direct control. It's not the tech isn't capable, it's just unsupported. And even if they aren't good devices, they should still get massive backing because the companies launching them should be believing in them. I'd expect to see a dozen Kinect/Move/EyeToy games in the launch period doing all sorts of novel things. Which may end up crap and they fall on their face, but there ought to be a massive push there, instead of the one or two games here and there, crossed fingers 3rd parties can come up with something.

If the console companies can't think of good things to use these devices for, why bother releasing them? If a new controller is only good if it can control FPS and platformers, why bother researching, let alone releasing, anything that can't satisfy that requirement? I agree with MS's philosophy that Kinect can add more than just core gameplay. They sadly lacked that same conviction and gave up, it seems.

 

[Deleted member 11852]

The various alternative controllers discussions have some of us tooting all sorts of valued uses for different controls, which aren't all about direct control. It's not the tech isn't capable, it's just unsupported.

Move is well supported, not only by Sony but even some third parties. At the time of launch, Sony even patched older games to support it but not every game supports it though - some just don't make sense. Kinect looked pretty well supported too.

I'd expect to see a dozen Kinect/Move/EyeToy games in the launch period doing all sorts of novel things.

I would on Xbox One with Kinect 2 being standard, but not on PlayStation 4, although the Play Room is installed on every PlayStation 4, and is indeed a bunch of free mini AR games which Sony has been steadily updating since launch. It's actually a pretty entertaining and fun use of the camera. The lack of decent Kinect 2 games though, or any on the horizon, is unforgivable although some people seem to be liking Kinect Sports Rivals. Not my thing, personally.

Which may end up crap and they fall on their face, but there ought to be a massive push there, instead of the one or two games here and there, crossed fingers 3rd parties can come up with something.

I think pushing games which are subpar is a bad Move (see what I did there?). Games obviously cost money to develop and crap games sell badly and can cause reputational damage your platform (or tech). Look at Fighter Within which uses Kinect 2 badly. Unbelievably badly. That one game spawned many articles across mainstream gaming sites questioning the chops of Kinect 2 as a gaming device. That kind of coverage and attention is not good for the platform.

If the console companies can't think of good things to use these devices for, why bother releasing them? If a new controller is only good if it can control FPS and platformers, why bother researching, let alone releasing, anything that can't satisfy that requirement?

Because it's not always possible to full realise something's potential at its inception. Sometimes, you ship something that has potential and hope it works, rather than not take any risks at all. You don't get to call Microsoft and Sony cowardly then get to complain about them taking risks in the same thread ;-)

 

[Shifty Geezer]

Move is well supported, not only by Sony but even some third parties. At the time of launch, Sony even patched older games to support it but not every game supports it though - some just don't make sense.

I wouldn't consider addition of a Move option in games as constituting belief or conviction in it. eg. Infamous 2 has Move controls. It works like a dual-stick game. It doesn't actually implement a Move game, such that you could perhaps reach into the screen with the move controller, grab someone and pull them back to you. As another example, sixaxis was a waste of time. Was it supported in Sony's flagship title, Uncharted? Yes. Was it any good? No. And it wasn't supported in subsequent Uncharted titles. I see Sony's Move support as similar to a football manager that buys a new young player and then has him sit on the bench for much of a season, only letting him play the last 5-10 minutes of some matches. If you were that player, you wouldn't think your manager had a great deal of faith in you to perform.

I would on Xbox One with Kinect 2 being standard, but not on PlayStation 4,

I'm talking generally. The fact Move isn't included in PS4, nor the camera, nor was the camera included in PS3, shows how little faith Sony has in the ideas. The fact ISS has foresaken the Move controls tried in I2 shows the idea hasn't got conviction behind it.

I think pushing games which are subpar is a bad Move (see what I did there?).

Of course. But the point with faith is you believe you have a good product. If Sony/MS believed in their ideas, they'd give them full backing. If they were then mistaken in their beliefs, they'd fall flat on their face which would be bad. The fact MS/Sony aren't backing their ideas shows they don't believe in them and are afraid of falling flat on their faces, which is why they are so cautious with the ideas. A gambler who bets a month's wages on a horse does so with the belief he can win. If he thought he was going to lose, he'd bet less or not at all.

Because it's not always possible to full realise something's potential at its inception. Sometimes, you ship something that has potential and hope it works, rather than not take any risks at all. You don't get to call Microsoft and Sony cowardly then get to complain about them taking risks in the same thread ;-)

But they're not taking risks - at least not substantial enough risks that the platforms need. Shipping something with the hope it works is letting it fail. You're trusting to luck, rather than trying to make it happen. Like a singer entering the X Factor without practising, because they hope to win but fear they won't get anywhere so don't invest the time in case it's a waste.

If I were in charge, I'd have shipped PSEye in every PS3 and had a strong catalogue in support of it, starting with EyeToy Play HD. I'd have followed up MS's original vision of a console for everyone rather than just core gamers and invested heavily in Kinect only/augmented games. Leave the conventional core games to the third parties. TF ought to have the players able to reach into the screen and grab people with their titans. Or something (heavily tested and refined and not just cobbled together). Instead, their flagship system seller doesn't need a fancy 3D camera at all. That shows MS doesn't believe in Kinect, and that lack of faith is going to kill it. And then when Kinect's dead and buried, all the Kinect-haters will say, "we told you it was a crap idea!" failing to appreciate the positives it could have brought because they lack the vision that MS also lacks.

 

[Deleted member 11852]

I wouldn't consider addition of a Move option in games as constituting belief or conviction in it. eg. Infamous 2 has Move controls. It works like a dual-stick game. It doesn't actually implement a Move game, such that you could perhaps reach into the screen with the move controller, grab someone and pull them back to you.

Which goes back to my original point where I said that the controllers may have been great tech but perhaps ill thought out for interacting with games. I don't, for a second, think that Microsoft and Sony developed Kinect and Move without thinking about how they could be used to control games. But I do think that they've both done a lot of experimentation and found that perhaps the control mechanics they've come up with, either aren't good from a comfort standpoint or the games just aren't fun or lack mass-market appeal.

Like I said. I think they were a bit of a punt.

As another example, sixaxis was a waste of time.

Yup, it was utterly pointless and we know it was a last minute addition.

I'm talking generally. The fact Move isn't included in PS4, nor the camera, nor was the camera included in PS3, shows how little faith Sony has in the ideas. The fact ISS has foresaken the Move controls tried in I2 shows the idea hasn't got conviction behind it.

I don't think the lack of Move/camera as standard with PS4 is anything to do with lack of faith but about only including useful technology in a games machine. And by useful I mean technology that will actually get used from day one. I don't think you can read much from lack of Move support in Infamous Second Son, a launch game that was delayed for four months. Launch games are an amalgamation of compromises.

Of course. But the point with faith is you believe you have a good product. If Sony/MS believed in their ideas, they'd give them full backing.

And if you believe you have a good product, and ship it believing it has a lot of potential, but over several years game designers have difficulty finding novel uses for that controller, do you then continue to throw endless resources at it, wasting both time and money, or do you scale back / cut your losses?

If they were then mistaken in their beliefs, they'd fall flat on their face which would be bad. The fact MS/Sony aren't backing their ideas shows they don't believe in them and are afraid of falling flat on their faces, which is why they are so cautious with the ideas. A gambler who bets a month's wages on a horse does so with the belief he can win. If he thought he was going to lose, he'd bet less or not at all.

How can you say Sony didn't support Move when games published from 2007 (retrospectively patched) to 2012 supported the device? It's not like they dropped it after six months. Sony, 2K, Activison, Capcom, EA, Namco, SEGA, Take 2, THQ, Ubisoft, Valve and Warner Bros all supported Move with their games. Number of essential must buy purchases because of Move controls: zero. Several years, dozens or developers. Lack of faith or just because the device wasn't that good to begin with?

And it's not as though the device isn't still supported. It's looking like it'll accompany Project Morpheus and then there was that weird Media Molecule tech demo using Move at PlayStation 4's February 2013 reveal.

As for gamblers betting a months wages on crazy ideas, that's generally not how companies are managed. Stockholders don't like that kind of thing

But they're not taking risks - at least not substantial enough risks that the platforms need. Shipping something with the hope it works is letting it fail. You're trusting to luck, rather than trying to make it happen.

Shipping an unconventional controller that eschews standard control features, while adding news ones, that represents only potential but no guarantee of support of critical execution in game design is definitely taking a risk, but flogging the same dead horse would just be dumb. The only way Move and a camera should be part of the package is if Sony had, and launched with, genuinely new breakthrough game concepts and designs that required that tech. The lack of this being shown probably means it doesn't exist.

Sony's risky investment this time, without asking customers to pay for when buying the PS4, is Project Morpheus. Which I'll happy to pay for if it delivers and if it's affordable. I don't want to underwrite Sony's risks, thank you very much!

But back to faith. Just because these controllers didn't work out as we'd hoped does not mean that Microsoft and Sony didn't take a risk, or that they didn't have faith or try hard enough. I'm pretty sure getting funding for stuff like this and getting it prototyped and manufactured required a hell of a lot of faith and belief. But sometimes things that are full of potential and great in principle are don't work as well when it comes to executing new ideas. Or maybe those ideas just haven't yet been realised.

If I were in charge, I'd have shipped PSEye in every PS3 and had a strong catalogue in support of it, starting with EyeToy Play HD.

Maybe you have a ton of ideas for camera-based games. Will they work, be fun to play and have mass-market appeal? Well those are different questions entirely. You can't just will great software ideas into being. I bet there are a lot of really enthusiastic, talented and skilled developers in both Microsoft and Sony studios who are trying like crazy to make this stuff work and be fun.

But it's easier said than done.

 

[dobwal]

The various alternative controllers discussions have some of us tooting all sorts of valued uses for different controls, which aren't all about direct control. It's not the tech isn't capable, it's just unsupported. And even if they aren't good devices, they should still get massive backing because the companies launching them should be believing in them. I'd expect to see a dozen Kinect/Move/EyeToy games in the launch period doing all sorts of novel things. Which may end up crap and they fall on their face, but there ought to be a massive push there, instead of the one or two games here and there, crossed fingers 3rd parties can come up with something.

If the console companies can't think of good things to use these devices for, why bother releasing them? If a new controller is only good if it can control FPS and platformers, why bother researching, let alone releasing, anything that can't satisfy that requirement? I agree with MS's philosophy that Kinect can add more than just core gameplay. They sadly lacked that same conviction and gave up, it seems.

Whatever is warranting MS's desire for Kinect standardization seems to have little to do with Kinect's current functionality.

As of now there is nothing known thats stopping MS from ditching Kinect and making it a pure peripheral going forward. It shaves $100-150 off the cost of the console. But not only have they refused to not make it standard. They have restricted their release schedule and staggered launches to accommodate its functionality. Kinect Rivals does little to demonstrated the importance of Kinect to MS.

I think may be MS hasn't fully revealed Kinect functionality as it relates to the XB1. Or at least Kinect is BluRay like in its purpose and represents technology that meant for more than just consoles. Tying it the XBO may simply be a strategy to drive down components cost while driving up adoption.

May be its most practical use from a gaming standard point will come from it being part of fortzella's functionality. Instead of having the userbase invest into Kinect and fortzella as separate purchases. Make Kinect standard, thereby reducing the cost of adoption of fortzella as a peripheral. It becomes viewed as a ~$150 additional invest for any XBO owner versus an additional $300, which is almost the cost of the console itself.

Think about it. Why incur the liabilities of Kinect if you are not going to produce not one or two titles but 4 or 5 at launch with at least a half dozen being shown in the pipeline, if Kinect's main contribution to the XBO were Kinect Rival or Dance Central like titles?

 

[McHuj]

I think pushing games which are subpar is a bad Move (see what I did there?). Games obviously cost money to develop and crap games sell badly and can cause reputational damage your platform (or tech). Look at Fighter Within which uses Kinect 2 badly. Unbelievably badly. That one game spawned many articles across mainstream gaming sites questioning the chops of Kinect 2 as a gaming device. That kind of coverage and attention is not good for the platform.

I think, despite being a sale success, Kinect 1 severely damaged the market for Kinect 2. MS over sold what Kinect 1 was capable of, it simply didn't work like MS promised. Kinect 2 may have fixed a lot of the issues, but at the same time I can't expect consumers and developers to waste time and money in order to find out. I imagine if Kinect 1 was never release, but instead we got the Xbox 1 in 2012 things would look a lot different now. I think MS would have had the buzz of a new console and new innovative interface.

 

[function]

I agree, MS can take advantage of the synergy between Xbox and PC. Hopefully they will.

Other things MS need to do:

- Release a Kinect-less SKU, for the majority of gamers who - based on evidence - aren't too bothered about Kinect, and use this SKU and a war-chest subsidy to substantially undercut PS4

- Release a Kinect-less SKU, for the majority of people who live in places that don't have localised Kinect coming, and who won't have any time soon

- Price cut the standard Xbox to meet price parity with PS4. This will force a direct comparison where the Xbox One will fare better than it currently does.

- Bundle Kinect Adventures with every Xbox One, to help justify the perceived "Kinect Tax"

- Work on a smaller fucking Xbox. It's the size of a man's crushed dreams, with a horse-cock sized power brick laughing at you at it sucks up dust from the floor. Also - incredibly - there are still teenagers, students, lodgers, husbands, fathers, and prisoners who play on games consoles not in front of the big TV in the living room and who don't have a premium high-end AV stand to dedicate as an Xbox One throne.

- Put apps outside the Gold paywall*

*MS made a very expensive TV Peripheral with Xbox One, but to use it as a TV peripheral you need to pay $60 a year for Gold. For none "multiplayer gaming owners", this makes Xbox the worst value proposition since being mugged.

 

[JPT]

Why should MS keep xbox alive, by sponsoring price cuts and bigger price cuts? What is the short and long term gain for MS the corporation of having the Xbox division? It there still a fight for the living room? Or was that the wrong battle and its wearables/mobility that is the key battleground now?

 

[function]

In the short term MS need to build up a user base. Everyone (except Nintendo) has done this by incurring hardware losses initially, since the MD / Genesis.

MS have build a DDR4 and shrink friendly platform. They need to have a strong platform when they get to that time or there's no point.

And the thing about having a console that you want people buy to watch TV on, is that if no-one buys it, no-one watches TV on it.

MS are taking steps now to build a MS 'ecosystem' for users and not just developers. Xbox needs to be a part of that.

 

[JPT]

In the short term MS need to build up a user base. Everyone (except Nintendo) has done this by incurring hardware losses initially, since the MD / Genesis.

MS have build a DDR4 and shrink friendly platform. They need to have a strong platform when they get to that time or there's no point.

And the thing about having a console that you want people buy to watch TV on, is that if no-one buys it, no-one watches TV on it.

MS are taking steps now to build a MS 'ecosystem' for users and not just developers. Xbox needs to be a part of that.

But why does MS have to be in the consumer space? They have earned their money in the business segment (by that I mean Office and Windows, not old basic etc).
I do believe that companies need to evolve and reinvent themselves over time, but again why the consumer space?

When you mention TV are you talking about Xbox being a STB for different OTT content or more traditional broadcast solutions? What is the glimmering gold for MS in the TV space.

Compared to spinning of the Xbox division, going forward with Office and Windows and invest into other projects aimed at the professional market? Skype, HaaS, SaaS, any XaaS with Azure and so forth?

Imo the fight for the living room has lost its importance. With tablets and smartphones, you consume your entertainment across your home now and the TV in the living room is not the central focal point it once was.

If we compare it to Sony which I believe has most of its business already in the consumer space, then the extension of having an games division is not that far fetched.

With all that said, I do like that MS and Sony are battling over the same customers, it probably makes for better equipment and games. But if you look at it from a management point of view or even the stockholder, albeit I think the stockholder things has gone very wrong, but thats way of topic

 

[Brad Grenz]

Yeah, I argued this last year after the Xbox One reveal. The war for the living room is over and Apple and Google won. Everything about the Xbox One is an attempt to roll back the clock on that victory and insert Microsoft products, services and ads where no one else wants or needs them. Comcast doesn't want Microsoft in between them and their subscribers. Apple and Google don't want tablet users running SmartGlass to do things those devices are natively capable of without it. Netflix and Amazon certainly don't want a Microsoft paywall between them and their subscribers. And the early sales results show pretty strongly that customers didn't want any of those things either.

Short of establishing dominion over every screen in your home (a goal the Xbox initiative can never deliver at this point) it's hard to see why Microsoft should care about this market anymore. Petering out with a long generation of diminishing market share does them nothing. Investing heavily, taking huge losses now to make the generation competitive with the hopes of eventually maybe breaking even in 8 years does them nothing. It's not like they are in this for the art of games as a medium in, and of itself. It looks like the smartest thing they could do is sell the Xbox business while it still has value, which brings us back to those Amazon rumors...

 

[Rangers]

Yeah, I argued this last year after the Xbox One reveal. The war for the living room is over and Apple and Google won. Everything about the Xbox One is an attempt to roll back the clock on that victory and insert Microsoft products, services and ads where no one else wants or needs them. Comcast doesn't want Microsoft in between them and their subscribers. Apple and Google don't want tablet users running SmartGlass to do things those devices are natively capable of without it. Netflix and Amazon certainly don't want a Microsoft paywall between them and their subscribers. And the early sales results show pretty strongly that customers didn't want any of those things either.

Short of establishing dominion over every screen in your home (a goal the Xbox initiative can never deliver at this point) it's hard to see why Microsoft should care about this market anymore. Petering out with a long generation of diminishing market share does them nothing. Investing heavily, taking huge losses now to make the generation competitive with the hopes of eventually maybe breaking even in 8 years does them nothing. It's not like they are in this for the art of games as a medium in, and of itself. It looks like the smartest thing they could do is sell the Xbox business while it still has value, which brings us back to those Amazon rumors...

And all this because in the equivalent of a basketball game that will likely go to 80-90 points (million sold), at least, they trail 7-4 in the first quarter

Hell, the PS3 spotted the 360 a much larger lead than that, didn't it? Granted, the 360 still outsold the PS3 slightly worldwide. Edit: 360 shipped 6m before Oct 2006, and led PS3 in shipments 10.4m to 1.7m as of end Dec 2006.

It's true I think larger aspirations in the gaming space are hard to pull off, but if the project is even mildly profitable, and it has been for several years, it doesn't hurt anything (here goes a junior college rail about opportunity costs, which I cast a skeptical eye towards). Regardless, MS seems pretty dedicated to it, and a lot of their top brass has reaffirmed that recently.

Microsoft's newly crowned head of Xbox, Phil Spencer, doesn't believe the software company will sell off its gaming division, he said in a recent interview.
Speaking to Edge Magazine in an interview excerpt published on Tuesday, Spencer said not only that the Xbox division will remain a part of Microsoft, but that it will be an important component in the tech giant's future strategy.

"Xbox is maybe the most relevant brand that Microsoft has with consumers today," Spencer told Edge Magazine, adding that the Xbox division is "an asset that's extremely valuable, and since our future ambition is to grow our consumer relevance, Xbox has to be at the center of that."

 

[Shifty Geezer]

In the short term MS need to build up a user base. Everyone (except Nintendo) has done this by incurring hardware losses initially, since the MD / Genesis.

And everyone who's done that has lost lots of money. Even Sony's unprecedented success with PS1 and 2 supposedly got wiped out by the losses from PS3. MS have already lost money on XBox. They maybe made it back again on XB360. You're suggesting they throw a load of money away again on XB1. If it takes a loss leader and a negatively-profitable product to drive Xbox adoption, MS should quit. That's the only sane business decision. Take the fight to mobile, or develop something to challenge Google TV, or apply their efforts elsewhere. A loss leader TV dongle will be a helluva lot cheaper than a loss leader console.

 

[Deleted member 11852]

Hell, the PS3 spotted the 360 a much larger lead than that, didn't it? Granted, the 360 still outsold the PS3 slightly worldwide

The last figures have them equal at 80m worldwide sales. Microsoft announced 80m at their FY14Q1 earnings release on 17 October 2013 and Sony in an announcement on 3 November 2013. I'd wager PS3 will surpass 360 at the next set of firm figures. Profits are something else and I wouldn't even want to go there.

Even Sony's unprecedented success with PS1 and 2 supposedly got wiped out by the losses from PS3. MS have already lost money on XBox. They maybe made it back again on XB360. You're suggesting they throw a load of money away again on XB1.

This. I don't understand all these suggestions to just lop $50 or $100 off the price to compete with Sony. Although Microsoft are competing with Sony in the same space, Microsoft's goal for Xbox One is to make a profit not outsell Sony at any cost - that's fanboy logic (nonsense). Part of the equation is the long term profitability of the console and part of that is profit equation will be licensing royalties, but on the majority of $60 game sales Microsoft are getting just a sliver of that. The rest goes to the developer, game publisher and retailer. Microsoft only make a lot of coin on games which they both develop and/or publish, which don't cost a lot to produce and which sell well.

As a platform holder you obviously want as big a customer base as possible but not by piling deeper into the red to make it happen and needing a potentially unobtainable average attach rate to break even, let alone make a profit.

 

[Deleted member 86764]

I honestly don't see how Microsoft can make a reasonable comeback this generation. They created a machine that has attempted to go after the 'casual' market and it hasn't worked. The 360 was a fantastic console, it was the most powerful thing available at the time of release, they totally lost that tact thinking that anyone will buy the Xbox One because of its multimedia capabilities. It just seems daft to release an underpowered box at a more expensive cost, who thought that'd be a good idea?? Jack of all trades, master of none.

I've been completely disappointed with Microsoft and their Xbox One. I was expecting much more from them. Even the naming convention is bizarre; Xbox (1) - Xbox 360 - Xbox One.

I fully expect a new box to come along much quicker next time, not another 8 year generation, more like Xbox to 360, which was 4 years.

 

[Deleted member 11852]

I honestly don't see how Microsoft can make a reasonable comeback this generation.

Games and gradual cost savings passed on as price cuts. It's what Sony delivered to turn around PlayStation 3.

However Microsoft are in the unfortunate position of not having anywhere near as many internal studios as Sony and they've lost a lot of their top tier talent - the original Rare team, Bungie, Bizarre Creations. What is Microsoft's equivalent of Naughty Dog, Santa Monica Studios, Guerrilla Games, Media Molecule and Sucker Punch - not to mention the other 20 or so development teams.

They could buy exclusivity but that's more expenditure. I think they just need to wait it out, as Sony had too. Arguably Sony didn't even begin to turn around the PS3 until 2-3 years after launch. The Xbox One has momentum and support, it'll skate until the great games appear.

 

[-tkf-]

Games and gradual cost savings passed on as price cuts. It's what Sony delivered to turn around PlayStation 3.

I think it's much more complicated than that.
They introduced the PS3 with a muddled message/vision at a high price point. They weren't able to hammer home the message that it was actually good value, that many of the extras on the 360 was included, they were late to the market thanks to the Blu-Ray laser (supposedly) but i think it was really the software that was a problem, development and games. Microsoft caught them off-guard and when they launched they had nothing impressive except the price tag. It took them years (it only does everything) before they were able to fight back with software, games, services and a reduced price.

Microsoft launched with a strong vision, strong hardware interesting features and a comparable gaming lineup.
The vision just isn't selling, neither are the features, which leaves them with a big clumsy box that runs games worse than the competition.

Again (repeating myself) i have a hard time seeing what they can do except throw money after it. They can reduce the box, make it sexy, drop the kinect, the HDMI, drop the price. But no matter what they do they still end up with the lesser powerful box that couldn't so they would need to be so much cheaper that people think it's worth paying less for the weaker machine that gives the least value (online services) out of the box.

Personally i want the big fat deal with everything because it's fascinating hardware. But i would expect a pure XB1 vs PS4 to be at least $50 cheaper than the PS4 in order to compete and have a chance to win.
And i wouldn't consider it a done deal even at that price difference.

 

[function]

And everyone who's done that has lost lots of money. Even Sony's unprecedented success with PS1 and 2 supposedly got wiped out by the losses from PS3. MS have already lost money on XBox. They maybe made it back again on XB360. You're suggesting they throw a load of money away again on XB1. If it takes a loss leader and a negatively-profitable product to drive Xbox adoption, MS should quit. That's the only sane business decision. Take the fight to mobile, or develop something to challenge Google TV, or apply their efforts elsewhere. A loss leader TV dongle will be a helluva lot cheaper than a loss leader console.

Loss leading is only a good idea if there's a long term strategy. I think (hope) that MS have one.

I think that MS's decision to go with esram and mainstream memory will allow them to undercut Sony long term. I don't think they'd have built the console they did and have been talking about hundreds of millions of sales if they were going to be stuck with a huge $500 box with a high BOM for ten years. Sony's success out of the gate means MS need to accelerate whatever plans they had for cost reduction, but in the short term they need to remain competitive on price.

Xbox has more value than just the Xbox console now. It can help bolster the MS customer ecosystem of PC's, tablets, phones, and the cloud back end that connects them all. MS absolutely need to build up and build in Xbox so they can pull the teen / twenties, thirties market into their ecosystem - it's something that Google (currently) can't offer. It's a competitive advantage.

And lets not forget that MS lost so much money on the Xbox 1 because they messed up. MS undoubtedly made vast sums of money on the 360 because they got it right. A console can be a huge profit centre in its own right. A miss step now doesn't mean that MS should bin consoles, it means that they need to get consoles right.

MS's mistake was in failing to understand where Xbox fit in, and what people wanted from a (bloody expensive) games console. They misunderstood what their usage figures from the 360 were showing them, and execs with an outdated view of the world tried to use new technology to win a war that's pretty much over.

MS still have a lot to gain from Xbox though.

 

[JPT]

Microsoft's newly crowned head of Xbox, Phil Spencer, doesn't believe the software company will sell off its gaming division, he said in a recent interview.
Speaking to Edge Magazine in an interview excerpt published on Tuesday, Spencer said not only that the Xbox division will remain a part of Microsoft, but that it will be an important component in the tech giant's future strategy.

"Xbox is maybe the most relevant brand that Microsoft has with consumers today," Spencer told Edge Magazine, adding that the Xbox division is "an asset that's extremely valuable, and since our future ambition is to grow our consumer relevance, Xbox has to be at the center of that."

This is what I am wondering about, what is MS strategy and what is the role they have for XBox. Because I can not see the relevance the consumer space is going to have for MS.

Not following MS as a business, so this drivel is just my pov.
I think when they went into the game industry with the XBox it was a valid choice, the living room was a relevant battle place, since consoles could move closer to PC and be used as the main computing device in the home and might kill windows/office at home. But then OS X, smartphones and tablets happened in a big way and consoles potential area of effect shrank to just games and video again.

Looking at Sony it seems they have to be in games, since consumer entertainment is such a large part of whom they are (consumer electronic, music, movies) so not being in gaming seems like the wrong approach for them, imo.