Japan is dying demographics
People don't realize that Japan is a dying market. I remember reading a few years back how all these elementary schools were closing because of a lack of children - in fact, they had recorded the fewest number of birth of babies since Japanese government began keeping track of births. Fighting for such diminishing market isn't something Microsoft should waste their efforts on.
Things MS could do that haven't already been mentioned....I think.....
1) Remove the xbox live fees for Japan.
2) Try to strengthen the Microsoft brand. While branding has pretty much died in the US. In Japan, brand awareness is still highly valued.
3) rename from Xbox to something else. x-box in japan means, from what i read in another blog, batsu-box. X denotes something bad as in bad quality. In contrast, X in the US, denotes extreme, mysterious, awesome, etc...
I think the one american company that could succeed with a gaming machine is apple. Ipods are the best selling mp3 players in Japan. There is something about the apple brand and their products that appeal to many japanese people. and with the iphone taking the majority share of the smartphone market..
http://www.appleinsider.com/article...e_takes_72_of_japanese_smartphone_market.html
Apple is really the one american company that could succeed there.
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As mentioned by ChefO, MS could simply buy Nintendo. Nintendo has like $10 billion in the bank, so an offer from MS would have to be around $35 - $50 billion. At that point, is it really worth it? So what if MS became the dominant console in the world, aside from ego stroking benefits, what would that really bring to MS? The reason why MS got into the console race was to stop Sony from taking over the living room, because that's where the future battle was supposed to be. But as it turns out, video game console aren't going to dominate the living room, more advanced blu-ray players, dvr-cable boxes, netflix players, apple TV, google TV and even TVs like Samsung's TV appstore (which are directly built into a TV. Netflix, ESPN, Yahoo, blockbuster, Twitter, Skype, etc.. ), are going to dominate....
http://www.tomsguide.com/us/pictures-story/183-Samsung-HDTV-Apps.html