Is Sony doing any better with the PS3? I’m guessing both aren’t doing so hot due to the economic downturn, although I wouldn’t be surprised if the Wii was making a profit–while the Xbox 360 competes with the PS3 for the same market, the Wii has tapped an entirely new market.
Yup. Here’s their 4th quarter release for 2009:
[url=http://www.microsoft.com/msft/earnings/FY09/earn_rel_q4_09.mspx]Microsoft Reports Fourth-Quarter Results[/url]
Last year the video games made them $497 million. This year it only got $169 million. That’s well over a 50% drop. Again, even considering the current economy, total investor nightmare. Pass on XBOX please: know a sinking ship when I see one.
The PS3 is still taking a slight loss I believe, though the slim and a slew of exclusives (Japan for FFXIII is PS3 only as well) are probably going to make it profitable by the end of next year. However, unlike the PS brand, the 360 did not have the most successful system in history to stand as a foundation for an expensive venture like the PS3 did. In fact, the original XBOX only a built a mound of financial losses that the RROD fiasco only added to.
I’m finally glad to see more criticism levied at the Wii though. Despite its massive profitability, the system has done far more damage to the gaming industry than it has helped. Unlike the PS2, with its bucket load of shovel ware, the Wii has very few marque games that have invigorated the industry. For every Hannah Montana like game on the PS2 there was a Final Fantasy X, Devil May Cry, GTA, or Persona. The Wii has relied solely on Mario and Zelda outside of its casual gaming market. This might change with Dragon Quest and the new Tales game seemingly trying to meld the “innovative” capabilities of the Wii with significant gaming experiences that reverborate throughout the industry.
Where do you see profits? I looked, and didn’t see them. But I did see revenue, and the revenue figures don’t look so bad. The “non-gaming” businesses (e.g. the Zune) are seeing huge drops, but the Xbox division had a comparatively modest $161M drop, in a quarter in which they implemented a price cut. Total number of units shipped went up, which is a good thing if you’re a console.
"Revenue from non-gaming business decreased $291 million or 42%, primarily reflecting decreased Mediaroom and Zune revenue. Xbox 360 platform and PC game revenue decreased $161 million or 3%, primarily as a result of decreased revenue per Xbox 360 console due to price reductions during the past 12 months, partially offset by increased Xbox 360 console sales and increased Xbox Live revenue. We shipped 11.2 million Xbox 360 consoles during fiscal year 2009, compared with 8.7 million Xbox 360 consoles during fiscal year 2008. Foreign currency exchange rates accounted for a $74 million or one percentage point decrease in revenue.
EDD operating income decreased primarily due to decreased revenue and increased research and development expenses, partially offset by decreased cost of revenue. Research and development expenses increased $252 million or 16%, primarily reflecting increased headcount-related expenses associated with the Windows Mobile device platform, driven by recent acquisitions. Cost of revenue decreased $326 million or 7%, primarily due to decreased Xbox 360 platform costs."
Technical ability is straightforward. Rights negotiation and marketing is much harder.
Seems like someone skipped their economic classes. 
Listed in the line of Operating loss. That would be the “bottom line” – just do a page search for $169.
Because that’s not in the negative it’s a profit. However it’s a 66% drop from last year. Microsoft axed 5000 people after the 3rd quarter results, the majority from XBox related divisions. 4th quarter disappointment ensures these people will be laid off. In the last two months, M$ has been quietly terminating XBOX R&D projects rather than personnel, because axing more personnel could trigger a stock drop, and M$ doesn’t want that happen on the eve of Windows 7. However people axing is expected to go full swing (PUN!) after the Xmas holiday, if things don’t get better. Wheeee!
Notice how M$ keeps touting that XBOX is making a small profit, but they continue to fire people left and right, who work for the XBOX division. Pure propaganda. Those who work in XBOX Land, are in very serous danger of being deported to the Unemployment Empire. XBOX ain’t making investors happy, so they’re pulling out like cockroaches in the light (3% turnaround is pathetic and better can be found elsewhere). They also can’t support the size they did the year before, and numbers are decreasing at a rate of 60% across the board over the last few quarters.
Just curious, but is there anything like a swap disc or mod chip for the 360?
Yes, but only if you want to be banned from Xbox Live.
On the other hand, it IS Xbox Live. Being banned might actually be a plus.
Are IDOLM@STER DLC outfits part of XBOX Live?
I think they might be!
Are you talking about a swap disc, a mod chip, or both?
Mod chip. I don’t know of any swap disc vulnerabilities for the xbox 360, but they could well exist.
I don’t think the Xbox 360 is going to fail as you suggest Narg. Microsoft’s sunk too much money into to let it fail at a stage when it has the most potential to turn a profit. At worst Microsoft won’t field a console for the next generation, and even that probably won’t happen. They may cut as much as they can in development (R&D), services (Xbox Live), and pricey exclusives, but games will continue to come out for it as long as there’s an install base and customers willing to buy the games. Just because the console is a bad investment for investors doesn’t make it a bad investment for gamers.
Well remember that someone has to pay for all those things. No rich investors means no pricey development. I’m not saying M$ will give up the video game market (not yet at least), just that things are severely sucking for them. XBOX is [u]NOT[/u] doing good, no matter how much M$ tries to fancy it up. They’re losing money each quarter. They’re losing investors. They’re firing people. They’re cutting R&D. They’re releasing games earlier (and thus more buggy or incomplete). [url=http://www.unscripted360.com/2009/01/23/microsoft-layoffs-strike-xbox-division-gamerscoreblog/]The XBOX community is unsure what the hell is going on[/url]. All of this is on top of the already problematic digital piracy and the retail used game issues. Oh… and competition from Sony and Nintendo.
Sure, it makes a profit, but just barely… and clearly not enough to save the rest of the giant. Some executives think it’s too much of a diversion, and the investments should have gone to other projects. It’s not a pretty picture… and the cut-and-slash activities of M$ are proving that.
EDIT
[b]Let me also point out that when Microsoft needs to cut fat, they do it to the XBOX department[/b]. The company likes doing entertainment business, but they’re not in specifically in that market… M$ is an operating system and business solution company first and foremost, and will sacrifice everything else to maintain that.
Right, but for the most part, the Xbox 360 has already been paid for. As a system, it was developed. It was revised. Contracts with game developers were made, and the games have come out. The major remaining costs are physical production of new systems, maintenance of Xbox Live, and perhaps Q&A for games. Sales of physical systems is probably break-even or a small loss, Xbox Live probably turns a profit, and Q&A can be shoved off onto developers if necessary, especially since the games can be patched later (from MS’s POV). Other than that, they just need to continue encouraging developers to churn out more games so they can collect their royalties. There’s no reason to completely drop support for the Xbox 360 at this point, or at any point in the near future. It’d be like buying a car and paying it off, then junking it because you don’t want to pay for gas.
I guess my point is that the continued R&D spending you’re fussing about is not really necessary to maintain the console at this point, and it’s probably not something gamers should be worried about, unless you’re interested in gimmicky things like Project Natal. As a user, all I care about is that games I like keep coming out for the console. And I don’t see anything happening that causes me to worry on that front. Sadly I do see that the PS3 seems to be picking up the bishoujo-type games I was hoping might be ported to the 360 for overseas release (like Atelier Rorona and Record of Agarest War), meaning I’ll probably be in the market for a PS3 in the next year or so.
Not how it works though. Something that “breaks even” isn’t how giant corporations or rich investors want things to work. It’s all about making MORE profit - as much as possible in short a time possible, without ruining the chance of making more large profit in the future. The XBOX is a business that’s almost just sitting there in neutral. You put $1 in and get $1.03 back. Even then that can only be achieved performing a drastic 60% cut across the board. That’s not good business. And given that XBOX is a side venture - a soda can from a vending machine - it’s hurting business focus for the executives.
XBOX is breaking even in the present, but without more games, continued advertising, additional research, fresh personnel with new ideas - it won’t be. That takes more capital… and the 3% gain that XBOX made is obviously NOT enough. M$ has to scrape more from other barrels, that they don’t want to scrape from. That’s why M$ is killing XBOX funding all over the place, and will continue to do so. XBOX isn’t M$ concern. It’s something that was done when M$ had money coming out of every orifice: which is no longer the case.
The writing is on the wall. If M$ has to kill XBOX to keep doing what they want to do, they will kill XBOX. Bill Gates isn’t going to stop Windows (or Exchange, or Office, or Silverlight, or Internet Explorer, etc) for XBOX. You as a gamer wants XBOX to succeed. Microsoft as a corporation wants to be a front end software company: all of their activities in the last quarters shows that happening at every turn. Microsoft is saving Microsoft - not XBOX.
So far it hasn’t come to that… but the mechanisms are clearly in place - tested and well oiled - if they need to.
Personally, I’d be more concerned about getting arrested for having sexually-explicit depictions of virtual children than not being able to play Final Fantasy XV on my 360.
That’s nothing. I’m going to go to be fined into poverty or go to jail because I won’t buy health insurance. Maybe I should go on an import spree and “earn” it at least :? .
I really doubt he will have much to do with it. Last I heard, he has, for all intents and purposes, no involvement in the company anymore. He is more concerned with his philanthropical pursuits than business matters nowadays as I understand it.
No involvement except being chairman of the board with veto power and holding the largest percentage of company stock for a single individual. He may not be the ruler sitting on the throne, but he can pull the strings as the puppet master whenever he wants. He doesn’t run day to day operations, but he has a major hand in all the big decisions. He also divided his position between two people, and rumor has it they couldn’t overrule him, even if they both agreed on it.