http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/ Engadget Comments for So what's Microsoft really losing on the Xbox 360? http://www.engadget.com/media/feedlogo.gif http://www.engadget.com en-us Copyright 2008 Weblogs, Inc. The contents of this feed are available for non-commercial use only. Blogsmith http://www.blogsmith.com/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/I wonder if sony are in the same boat with the PSP.
It's a ball of technology and is only $400 AU...
Dirt cheap for what it can do... all the R&D that went into it too.]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
Oddly, Microsoft and Sony are polar opposites when it comes to gross profits. Sony's gaming division is the only profitable division, supporting the entire company, and Microsoft is profitable in all divisions but gaming, and the rest of the company is supporting the gaming division. Hmmm...

The PS3 could literally hurt Sony if unsuccessful.
]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
It doesnt matter that Microsoft is taking a loss...they are making DESPERATE attempts @ market domination...they will fail, due to the fact that their hardware does not support blu-ray and also their software will not be comparable to the PS3's lineup... mebbe Halo 3 but... it wont compensate for all the other good titles PS3 will have.

*If square enix does want to be a douche and support microsoft then Xbox might be able to win this generation... even then its highly doubted*

also think of the crappy hardware they have... with the errors ... HA Micorsoft sucks...

loss my ass]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
#4 "JT" -- "never" and "always" and "until I can afford" sound like fanboy talk. I never said I'd never buy a Mac. I said I'd buy a Mac when Apple had a real operating system. Now I've got a Mac and a few PCs. This irrational polarity and brand loyalty is amusing, but I suppose when one's pre-teen identity hinges on having the same platform as their friends, you don't risk thinking for yourself. If the PS3 has compelling games, I'll end up with one. Most of the loudest voices in the "console wars" aren't even qualified to compare the two technically, so all thats left is how pretty the box is and what games play on it.

Can people write anything more interesting about the console market other than merely cast their lame vote as to whether or not they'll buy one or the other?

Vive le PS3 and the 360. Competition is good. Quality is driven up, prices driven down. (taking notes Pete#1?)

Give up the treehousey little boy's club mentality. You are not your gear. You are not the labels you're wearing. But when you're 14 and terrified about not fitting in, you don't tend to think straight like that, you want things in black and white, what's cool and what's not. Sooooo original.

Nobody cares which one you buy or don't buy. Buy both, buy none. Why all the loud crowing? What do you have to gain from promoting the product you probably haven't even bought yet?]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/180 gb IBM harddrives which are already ancient history.]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Owner:"Cool! Now I can play the Xbox360!"

(flashing green power button)
Xbox360:"I'm sorry Dave, I'm afraid I can't do that."

Owner:"huh? I'm not Dave."
(Black Screen of Death)

And from the wise words of Darth Vador:"NOOOOOOOOOOOOOOOOOO!!!!!"
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Wouldn't they lose even more money if they have to replace those with heating problems?]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
PS3 will own... i have to admit that i am a sony fanboy, BUT... lets face the facts... microsoft cant win, their software support and their hardware cant match up to the caliber to that of sony's PS3...

especially with DEFECTIVE hardware...

]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
sounds pretty far-fetched to me.]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/u see, it says that microsoft has lost millions, if not billions, on the original xbox, and it is set to lose even MORE money on the current generation 360. what it aims to do is create a third and fourth generation console which would then VERY slowly close the losses gap, and they would eventually start making money.
just imainge buying a pc with the specs a 360 has. it would set u back more than a couple grand. thats why games are so expensive! =D]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
Another person underestimated the power of BlueRay by comparing a 40 gig hd-dvd disc to a 180 gig hard drive by ibm. The big deal about the 40 gig disc is that most consoles can't accept a 180 gig ibm harddrive with Madden 07 on it. BlueRay could very well give SquareEnix the creative license they need to make these seamless worlds with their games and give Kojima the power to make an even more spectacular Metal Gear Solid. Can you imagine GTA Sin City expanding out to the nevada desert and beyond? GTA Tokyo? GTA Paris (Frank starts looting?). Either way, the BlueRay will only help the performance of the PS3 and allow Sony the ability to offer complete seasons of television shows to be viewed on ONE Disc via it's PS3. Nobody is going to purchase a purely high def dvd player, why not get the all in one solution?

Moving on, Xbox is clearly going to operate at a loss on the backend because Microsoft is going to make it's money back via Xbox live. In the future it will be able to access downloadable movies, tv shows and even mp3s to download. Microsoft will be able to push it's "Plays For Sure" DRM while charging for downloads. It all makes sense. PS3 will operate at even more of a loss due to the expense of not only providing BlueRay for video games, but getting the discs pressed, marketing the game, developing and testing the game, providing the technology which, an hd-dvd player alone can be 300 bucks, so they're throwing in an online ready, top of the line game console in for another 100 bucks, oh yeah BLUETOOTH. Trust me, Sony is headed for a bigger loss, but i'll tell you, they're going to make their money back in the asian markets and their success there will carry over into a stronger campaign for the american markets and Sony will generate the exact type of buzz, the 360 is getting now.

Don't cry for Microsoft and Sony, they'll make their money back. Also, stop calling the xbox's hardware crappy. it won't use blueray because i believe microsoft is in talks with another hd-dvd standard. Only time will tell what will be coming.]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
peoples, make sure you buy all your MS software and pay full price, to help save them from going under!!!]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/I am soooo happy xbox has glitches...It just shows, that microsoft is a bunch of lazy, corporaty, monopolizin, good for nothin biatches.
I can't wait for ps3 to come out. Then we'll see who's the boss.]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
Flipside-upside-down comparison:

Dell pcs are cheaper with an o.s. than without. The combined -saved- fee price over-rides the manufacturing/parts total.

Games are constantly given as gifts, etc.
]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/5 games (soon to be 6 when PGR3 arrives from Best Buy) and counting.]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
Imagine instead of buying a disc to play a movie, you simply have it sent to you over the internet or TV cable lines. Then depending on the license you can either view X times, keep, maybe transfer or burn the movie yourself.

When you think about it, that's what a partnership between TIVO and Netflix could achieve. Then it's just a matter of selling or leasing new HD hardware (essentialy hard drives in every home or I dunno Cisco Scientic Atlantic set atop boxes?).

Why replace DVD disc with another disc when you can bypass disc all together?

In a sense, Microsoft is using this method already, by distributing Live games, demos and trailers. What's to say they couldn't distribute a major game that way?]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
Good points across the board. I completely agree with your economics lesson, but I think you have to acknowledge those who buy the Xbox because everyone else does. It's viral marketing in it's clearest form.

Additionally, I think we have to look beyond specs and even games and look at how the unit is set up. The largest part of console gaming is headed towards playing with others. Xbox picked up (or perhaps started) this and the PS2 was woefully behind -- as evidenced by only 2 controller ports and a lack of cooperative games. While I loved my PS2, I bought an Xbox so my mates and I could play together and make a good evening out of it.

There are always intangibles that will allow new users to enjoy the system. Perhaps it's Xbox Live for the 360 that will somehow attract older gamers or more females. Regardless, it's not prudent to discount marketing or general trends in the market -- those may be the determinants of the end game.]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/ square enix is still backing Sony, all they're giving XBOX360 is FFXI, the online one that ps2 kids already have, so don't fear, SE wouldnt forsake its loyal sony fans. They're philosophy seems to be if, if its nay Japanese, its nay good]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
CPU
---
360: Custom PowerPC 360 cuz dual hdmi ports etc
lets say $100 for misc manufacturing and other costs for sony. 60 for ms

Wifi:
360 -- NOT FUKING Available without charging 100 extra
ps3 -- costs sony around 20-30 lets say


controller:
wired: 15
wireless: 25

so with these rought things lets add up

ps3: 90(cpu) + 90(gpu) + 90(blu-ray) + 100(misc) + 25(wifi) + 25(controller) = 420

360: 65(cpu) + 90(gpu) + 15(dvd) + 60(misc) + 15(controller)= 245

now the basic 360 is sold for 299, there ms profit already around 54 for each core system..

consider the 499 bundle. add 40 for hdd, 15 for remote, 10 more for wireless controller. so now the cost is 310 which is sells for 399 so already profit of 89 for each system...

now rake up things:
it makes a profit of around 60-70 dollars on each wifi card sold which sony has on-board. around 60 bux on the hdd sold separately.
its not loosing money, its swimming in money,,,,,,,,,

]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
Continue fanboys.]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Buy a whole loada Xbox 360s without games!]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
Also someone asked earlier about how much Microsoft makes per each title sold. I read somewhere its in the neighborhood of $8 per title, not including their own released titles, which obviously make more.]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
If the cost is US$245 & the selling price is US$299 for the basic system, how do you figure that Microsoft are making US$54 profit?.

Retailers are happy to take this product on & sell it with no markup to pay for rent & wages for people like you?.

I guess in your perfect world, there are no development costs either. M/S just had an idea, wrote it down on the back of an envelope & then asked a contract manufacturer to build it?.

Think before you start typing.

]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
The controller is so damn sexy]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/ evil American company?]]>Dec 19th 2005 12:55AMhttp://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/http://www.engadget.com/2005/11/24/so-whats-microsoft-really-losing-on-the-xbox-360/
The controller is so damn sexy]]>Dec 19th 2005 12:55AM