Microsoft Loses Money on every 360 Sold

Microsoft is good a puttin' a hurtin' on their competitors, but Sony and Nintendo have too much of the market to be wiped out. Sony hasn't really taken Xbox that seriously until now. I guess that has to do with their extreme difficulty in wrestling the Tokyo market away from the Sony home-court advantage. They have the majority of the market, competitive (although somewhat inferior) graphics, and own a good deal of the major game makers and the licenses on top games. Now the tide is turning.

If they begin to wake up and realize that Xbox is kicking them in the teeth, then they will have to pull out all the stops. We'll get the best systems available, the best games they can make, and they'll undercut each other in prices. Microsoft will respond with more great games and options.
 
Darth_Jonas said:
Microsoft is good a puttin' a hurtin' on their competitors, but Sony and Nintendo have too much of the market to be wiped out. Sony hasn't really taken Xbox that seriously until now. I guess that has to do with their extreme difficulty in wrestling the Tokyo market away from the Sony home-court advantage. They have the majority of the market, competitive (although somewhat inferior) graphics, and own a good deal of the major game makers and the licenses on top games. Now the tide is turning.

If they begin to wake up and realize that Xbox is kicking them in the teeth, then they will have to pull out all the stops. We'll get the best systems available, the best games they can make, and they'll undercut each other in prices. Microsoft will respond with more great games and options.
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I think the thing that's lacking in this arguement, however, is that this seems based on the concept of a "winner" in the firat place. Game consoles aren't like VHS recorders- unlike the VHS/Beta contest, consumers aren;t going to pick one format over another... dedicated console gamers are going to buy ALL the systems, if they are affordable enough.

Or... maybe I'm being naive- I admit I might be. After all, we hang in a world were most of our friends and people we associate with have EVERY console and buy it almost immediately on release, and I think that sometimes we forget that people that play games like WE play them are probably the minority. I've never seen stats on how many console owners only have one system, but I bet that it's quite a sizable percentage- I know that of all my teenaged daughters friends ALL of them have at least ONE cinsole in their house, but all of them comment with wonder that my daughter has an Xbox, a PS2, a N64 a Gamecube and even a 2600, all out and hooked up.
 
Good point, ImagoX. I do think, however, that the upcoming brawl between blueray and hddvd will affect the console wars. The tech industry (from all the reports I have read) say that it will be one or the other. Movie companies, harware manufacturers, and computer distributors are all weighing in for a hefty battle. The ones who will build the things have said they will only build one or the other. Apparently it will be too complicated to build one that reads both (or at least it will be too costly to make). This cannot help but to affect the value of PS3's and Xbox 360's.
 
Darth, an excelent point. This ties back to the fact that both Sony and Microsoft have other considerations that they are trying to be sensitive to beyind simply giving consumwers what they want and need in their entertainment. Sony, for example, is trying to walk a delicate line between what tiehr hardware division would like (a format that gives Sony customers total access to their entertainment data, whether it be DVD, CD, game. music, movies, etc.) and their Publishing side that would be happy only if every last byte were layered with unbreakable proprietary Digital Rights Management data. Microsoft is doing the exact same thing with the way they atre building DRM into Windows Media Player.

Because of that, I don't think that COST has anything whatsoever to do with what you're talking about- it's simply a matter of which proprietary format will "win" the majority of users. Or, to put it more bluntly, I think that it will be a cold day in hell before we see a console or any other proprietary device (portable, media center PC, etc.) that reads both hddvd and blueray.

PCs, on the other hand by their very nature can circumvent such artificial DRM controls because they have the potential to work with unmodified source data (at least they do for now). One day we very well might see a chip on a PC mobo that enables some manner of DRM right at the hardware level (bypassing whatever software the user has loaded to their hard drive), but I don't think we will- if a manufacturer like, say, Dell, were to do so, then some competitor would just make a PC mobo without that DRM chip. Only something like a federally mandated law requiring such a hardware DRM scheme would cause that to come about (also not impossible).
 
spudlyff8fan said:
Are you actually expecting them to be able to bump off Sony or Nintendo?

Really, are you?
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Expecting? No.

I do realize that it's a possibility. Ten years ago, if you told someone that Sega would be pushed out of the hardware market entirely, they'd laugh at you. It's hard to say exactly what it would take, but since software is the more profitable side of the equation, one bad console could push any of the "big three" out of the hardware game, concievably.

Of course, this is the danger of competition. Anything that has a benefit also has a danger, the key is mitigating the possible negative effects. To be honest, I think three consoles is one too many. Two consoles would provide the necessary competition to encourage improvement while limiting the outlay and decision making for the consumer.
 
BCampbell said:
Expecting? No.

I do realize that it's a possibility. Ten years ago, if you told someone that Sega would be pushed out of the hardware market entirely, they'd laugh at you. It's hard to say exactly what it would take, but since software is the more profitable side of the equation, one bad console could push any of the "big three" out of the hardware game, concievably.

Of course, this is the danger of competition. Anything that has a benefit also has a danger, the key is mitigating the possible negative effects. To be honest, I think three consoles is one too many. Two consoles would provide the necessary competition to encourage improvement while limiting the outlay and decision making for the consumer.
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Good points. Three can get crowded with two smaller ones competing while the big fish wipes them out (ala Ross Perot). However, playing to different markets could work nicely. The Nintendo series is traditionally for the younger crowd, playstation bridges all, and xbox is more for older teens and adults. If nintendo stays with the kiddies, they shouldn't have a problem surviving. I look for them to surprise a few people with their next release.
 
Actually, I think cubby-holeing Nintendo as "kiddie" (something I admit that I did for years) does them a dis-service. Here's a GREAT article from over on Lost Garden, written by a game developer and designer, that really gives some insight as to why nintendo plays a fundamentally different game than Sony/Microsoft when it comes to their consoles:

http://lostgarden.com/2005/09/nintendos-genre-innovation-strategy.html
 
Did the PSP kick the #$@@ out of the DS? Can the Rev compete with the 360 or the PS3?? The future of Nintendo is kind of grey here..
 
See, when Stan writes something intelligble I agree with him. The next couple of years are the "make it or break it" time for Nintendo. They're facing more competition in both the handheld and console markets than they're used to, and if they don't crank it up soon they maynot last much longer.

I do think the DS is putting up a good fight against the PSP -- and the GBA SP is still selling well. That could turn into a victory for Nintendo. But the Revolution is questionable, and it's way too early to call.
 
Well, even though Nintendo sales went down 21% this year, and the GC sales went down 35%, Nintendo still made millions in profit this year. So even if they trail in the numbers, they are still making money. But the PSP really hasn't done well. The DS is killing it in sales, and not a little, either. I think Nintendo will make it out of this generation just fine.
 
You can hardly call a 21% drop in sales good business, though. Now, I'm not saying this is going to kill Nintendo, but you ccan't runa business on those kinds of numbers. The GC is selling very poorly so right now the big N is relying on handheld sales, and they really need to have a success in the Revolution.

I guess it can be put this way: for how many years do you think Nintendo can afford to drop sales by 21%?
 
but they know they are fading out the GC. there's no sense dumping money into it. just because sales are down (which makes sense...the next gen is coming) doesnt mean they are spending heaps of money marketing the GC or developing new technologies for it.

think of it this way. nintendo's handheld market is the bread and butter. a home-entertainment console is equivalent to some other companie's (like sony) HANDHELD. its sort of an extra thing on the side to get more money.

but i do hope revolution takes off big. i will probably get one.
 
I dunno, it seems like Nintendo is ignoring the GC because it's not selling well, not the other way around. I don't see Sony ignoring the PS2 just because the PS3 is around the corner. If anything, some of the best PS2 games are coming out right now.

I'm sure that Nintendo knows what they're doing, but you can't say that a 21% drop in sales isn't causing them some concern. You don't just brush something like that off if you're trying to run a business. Just because a company is "making money" doesn't mean they're doing well.

And yeah, I'm pretty excited about the Revolution. I'm hoping we'll see some dofferent gamesthat take advantage of the controller. I still play Sega Marine Fishing, primarily because of the fishing controller. The wya the player interacts with the game is a huge deal, and it's about time we did something other than holding a lump of plastic in our hands.
 
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