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Xbox 360 To Profit Next Year, Says Bach

Zonk posted more than 7 years ago | from the bout-smegging-time dept.

XBox (Games) 132

An anonymous reader writes "Robbie Bach, president of Microsoft's entertainment and devices division, has stated he expects the company's console business to finally break even some time in 2008. After years of losses from the games division, this would be a significant breakthrough for Microsoft's efforts in the games industry. '"Xbox is the hardest piece of consumer electronics hardware to produce in the world, no debate," he said, admitting that "costs are a little higher than we'd like." Microsoft doesn't expect to make a profit on hardware alone, but "we'll probably be gross margin neutral on that over the life cycle of the product, and try to break even on that."'"

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Disapointing (2, Insightful)

HappySqurriel (1010623) | more than 7 years ago | (#18993779)

Should it be news that a company is going to break even or start making money on a product line?

I understand the loss leader strategy, but it seems a little insane that a company has to wait several years before they can start making money on a product.

Re:Disapointing (-1, Flamebait)

Anonymous Coward | more than 7 years ago | (#18994269)

black people

blacks ftw (-1, Flamebait)

Anonymous Coward | more than 7 years ago | (#18995739)

we have your women. next year we will take the white house. he.

it's our time now.

Re:Disapointing (4, Insightful)

Quila (201335) | more than 7 years ago | (#18994447)

Long-term vision is so rare these days that people are surprised when they see it.

Short-term Wall Street thinking wouldn't have allowed this. They'd say the XBox division was running a loss for 12 quarters straight and demand they stop the cash drain.

Re:Disapointing (2, Insightful)

HappySqurriel (1010623) | more than 7 years ago | (#18994653)

Long-term vision is so rare these days that people are surprised when they see it.

Short-term Wall Street thinking wouldn't have allowed this. They'd say the XBox division was running a loss for 12 quarters straight and demand they stop the cash drain.


Long term vision is not what I would call the XBox or XBox 360 ... A vision does not take 7 years to finally break even on a yearly basis after you have lost $6 Billion. As far as a return on investmet, the XBox brand may finally break even as a whole after 10 years making their profit 0% after 10 years (a pretty awful return) so investors would be right to be angry at Microsoft.

Of course, everyone wants instant gratification (3, Insightful)

Maximegalon (1003655) | more than 7 years ago | (#18995151)

"A vision does not take 7 years to finally break even on a yearly basis after you have lost $6 Billion."

First off, your numbers are off. The classic xbox launched 11/01. Work may have started earlier but you don't earn sales until the product comes out. Profitability is expected in 06/08, not 11/11. So you are off by 3.5 years when you say it took them "10 years" to make a profit.

Also, the last stat I saw said an estimated 5 billion lost, not 6 billion. Finally, the hardware is now making a profit for them, and the chip size reduction will only further that.

Even using your numbers of $6b over 10 years, that is only 250m per quarter. That's basically nothing to MSFT. If they can invest pocket change and get big returns down the road, why not?


"So investors would be right to be angry at Microsoft."


The last I checked, investors are pretty darn happy with MSFT's stock as a whole. As of today, they are within $1 of their 52 week high.



Maybe you should check your facts. I agree with above. It's typical US sentiment. Where is my instant gratification? I didn't get rich quick, any setback is certain doom, kill the show after two episode if the ratings don't meet expectations, etc. etc.

Re:Of course, everyone wants instant gratification (1)

rtb61 (674572) | more than 7 years ago | (#18997841)

How is the M$ stock going against it's record high, somewhere between a half to a quarter of what it was when they started the whole xbox failure.

How much has the xbox hurt the M$ pc games division. Not only has it lost money but it is also causing other divisions to loose money. Does the xbox account for a licence fee of the windows operating system, or has that been written off as well. When they are talking about being in profit, is that overall or is that just for that year and overall they will still be in loss.

They have already started the vapour marketing on the next xbox, how far out is that product, and how many more billions of dollars will they lose getting that one out. The only positive thing you can say about xbox is that, it is no where near as bad as the Zune, whose apparent target market is 85 year old uncles, WTF ??!

Re:Of course, everyone wants instant gratification (0)

Anonymous Coward | more than 7 years ago | (#18998553)

IANA(Stock Market Analyst) but he said 52-week high, not record high. 6/7 years ago is > 52 weeks.

Re:Disapointing (2, Insightful)

frakfrakfrak (1049468) | more than 7 years ago | (#18995217)

Long term vision is not what I would call the XBox or XBox 360 ... A vision does not take 7 years to finally break even on a yearly basis after you have lost $6 Billion. As far as a return on investmet, the XBox brand may finally break even as a whole after 10 years making their profit 0% after 10 years (a pretty awful return) so investors would be right to be angry at Microsoft.
Yeah, that's great, but what about 15 years down the road? Or 20? In 20 years, who knows if Windows will still be the cash cow it is now? Who knows if video games will be either? Microsoft at least has the ability to benefit as long as either one of those is a cash cow in 20 years.

That's the kind of long-term thinking they're after. They're a company built around having a couple of cash cows lying around (Windows, Office). They are always looking for another one.

I'm not even a Microsoft fan. But they're definitely doing a good job of fucking things up less hard than Sony this time around. Not that that's particularly difficult, but the company DID produce Microsoft Bob, so you never know.

Re:Disapointing (-1, Troll)

Anonymous Coward | more than 7 years ago | (#18995301)

ha ha!!!!! pwned!!!!!!

Re:Disapointing (4, Informative)

Endo13 (1000782) | more than 7 years ago | (#18995349)

Um... I would actually say they're doing pretty good to be making a profit that quick. According to Wikipedia it took Amazon.com [wikipedia.org] about 8 years to become profitable. And this [XBox] was just one branch of a much larger company; MS as a whole has still been quite profitable for their shareholders in the meantime.

And hasn't their X-Box Live been profitable from the start?

Re:Disapointing (1)

bogjobber (880402) | more than 7 years ago | (#18999177)

Amazon didn't burn through $6 billion in capital during that eight years. And even though it's obviously possible that the Xbox division can post a profit now, is there any business in the world where you can't post a modest profit after six years and billions of dollars invested? They could've used that money to buy a 15% stake in Nintendo and made a real gain instead of being six billion dollars in the hole. Hell, they probably could've bought Sega completely and continued with that brand.

Re:Disapointing (1)

naden (206984) | more than 7 years ago | (#18999555)

And hasn't their X-Box Live been profitable from the start? And hasn't their 120GB Hard Disk Expansion peripheral been profitable from the start? And isn't this completely meaningless given that the core XBox product is severely unprofitable? And shouldn't you be reading an How To Make Money In Business 101 book instead of posting?

Re:Disapointing (1)

Quila (201335) | more than 7 years ago | (#18998781)

It's worth it if in the end you're a major player in a multibillion dollar market where you previously had no product.

Re:Disapointing (1)

KiLLa_TK (1030038) | more than 7 years ago | (#18999131)

Long term vision is not what I would call the XBox or XBox 360 ... A vision does not take 7 years to finally break even on a yearly basis

would you say Amazon.com has no vision? Amazon.com was launched in 1995 and did not post a quarterly profit until 2003. http://news.com.com/2100-1017-819688.html [com.com] Sometimes making money right away isnt the most important aspect of becoming a strong player in a market.

Re:Disapointing (1)

Blakey Rat (99501) | more than 7 years ago | (#18994473)

What bothers me is the fanboys using the amount of profit Microsoft makes as a justification of how much better Sony and/or Nintendo consoles are. As if I, as a consumer, give a rat's ass what the Xbox costs Microsoft to make... that's their problem, not mine.

"Yeah, Xbox 360 might have better graphics than Wii and PS 3 but, uh, ... uh... Microsoft doesn't make a profit!"

Re:Disapointing (2, Interesting)

Applekid (993327) | more than 7 years ago | (#18994613)

If a console isn't generating [enough] profit, it always runs the risk of being abandoned. That's usually bad for gamers*.

That said, it's unlikely Microsoft would abandon XBox even if it didn't make a profit next year or even the year after. It's there simply to be in the market. The justification is likely the same as Windows: get enough people familiar with the platform and nobody will even consider the alternatives.

The statement is nothing more than to pacify the shareholders on the recently news that Microsoft's gaming division lost $300 mil last quarter.

*Bad for most gamers. It's great for people with stocks of games and are speculating on the aftermarket value of them. I could rant about those people but, nah, I'll leave it to someone else. ;)

mod parent down - homo! (-1, Flamebait)

Anonymous Coward | more than 7 years ago | (#18994985)

applekid. you are not credible until you remove the name of the company you throatfuck from dawn to dusk. even after that - you'd need years of gaytox before you were ever credible enough to join modern society again. you eroticize a corporation, you gay fucking piece of shit.

stfu. omg no wai.

Re:Disapointing (1)

xero314 (722674) | more than 7 years ago | (#18994747)

As if I, as a consumer, give a rat's ass what the Xbox costs Microsoft to make... that's their problem, not mine.
it becomes your problem when you have a significant library of games and nothing to play it on because Microsoft decides to stop losing money and gets out of the console business. I'm not making a prediction, just pointing out that a companies profitability is important to the consumer.

Yeah, Xbox 360 might have better graphics than Wii and PS 3 but, uh, ... uh... Microsoft doesn't make a profit!
Allow me to fix this for your "Yeah, XBox 360 might have better graphics than Wii and about the same as the PS 3 but, un ... uh... Microsoft nor Sony make a profit on their current console sales."

Re:Disapointing (0)

Anonymous Coward | more than 7 years ago | (#18995157)

it becomes your problem when you have a significant library of games and nothing to play it on because Microsoft decides to stop losing money and gets out of the console business.

Holy shit, MS rigged their Xboxes and 360s to self-destruct if they ever got out of the console business?

Re:Disapointing (0)

Anonymous Coward | more than 7 years ago | (#18995329)

Well, apparently they self-destruct anyway, from what I've heard

Re:Disapointing (1)

xero314 (722674) | more than 7 years ago | (#18995903)

Holy shit, MS rigged their Xboxes and 360s to self-destruct if they ever got out of the console business?
They didn't have to, the tend to fail on their own with out self destruction, like all consumer electronics do eventually. To problem comes in when you have to find a replacement for your broken one. Or when the next generation comes out and you don't have ANY backward compatibility since MS stopped making consoles. It's still all hypothetical, but their success in the market certain effects their consumers.

Re:Disapointing (1)

treeves (963993) | more than 7 years ago | (#18997915)

My 7 year old son won an XBOX 360 w/ 12GB HD and we've been using it for a couple of months and recently it started freezing up in the middle of play. Any suggestions for hardware defects to look for?

Re:Disapointing (1)

Fulg (138866) | more than 7 years ago | (#18998113)

recently it started freezing up in the middle of play.
"Xbox is about to die."

Seriously, call 1-800-4MY-XBOX, they'll tell you if there is cause for concern (and they'll swap it out if so).

I'm on my fifth one already... Previous 4 died (and anyone who knows me knows I take extreme care of my stuff). I'm starting to believe the "self-destruct" conspiracy... :)

Re:Disapointing (1)

Grave (8234) | more than 7 years ago | (#18998737)

It's simply a case of Microsoft squeezing their manufacturing partners too hard. Some of these factories still turn out quality systems that don't fail. But some end up dying pretty quickly. This is probably also a result of using Chinese manufacturing firms, who have not historically cared about quality in the first place. I have a launch 360 and haven't had any problems aside from one or two freezes while running emulation for classic XBOX games (which is as likely to be a glitch in the software as anything).

All this being said, Microsoft needs to push the warranty/replacement costs back onto the manufacturers that are consistently producing the defective systems, or start canceling contracts--otherwise these companies are never going to change their ways.

Re:Disapointing (1)

blackicye (760472) | more than 7 years ago | (#19000179)

This is probably also a result of using Chinese manufacturing firms, who have not historically cared about quality in the first place.


If you decided to outsource manufacturing to the the lowest bidder, who is fulfilling your order with slave labor..do you honestly think you'd be caring about quality?

If so, you're deluded. If not, then what makes you think they care any more than you do?

Re:Disapointing (1)

JebusIsLord (566856) | more than 7 years ago | (#18998129)

The warrantees are good for a full year... send it back. They'll even pay for shipping.

Re:Disapointing (1)

bigman2003 (671309) | more than 7 years ago | (#18998187)

1-800-4MyXbox

I have returned 3 of them, and my current box is making strange fan noises.

I think the 360 is an awesome game system, but the hardware failures are killing me. The fact that the Elite wasn't the die-shrink was a little disappointing. And the failure rate must be killing Microsoft. I figure they have spent at least $50 just on the shipping of my boxes alone.

I will say that the last experience I had with their support was fantastic. They have a very quick and easy self-help phone tree...no, it is not crappy or frustrating.

When I got to a human (quickly) the guy basically went through the return process with me right away- no hassles at all.

The shipping to and from was quick.

I just wish I didn't have to ship it out at all. Their service is great, but it would have been better if they hadn't boned the hardware in the first place.

Re:Disapointing (1)

blackicye (760472) | more than 7 years ago | (#19000173)

Yeah the new Xbox 360 elites actually have blobs of epoxy holding down the processor, its quite disturbing.

Thats how shoddy the soldering work is, you've got to cut costs somewhere!
Arguably part of that is due to the use of ROHS compliant (lead-free) solder.

Many of the Red ring of death cases from the earlier batches of Xbox360s were also because of this.

Resoldering the processor back yourself is likely not an option for most saner people, you're best off giving them a call and sending it in. (don't send in the harddrive if you're sure its working fine, you'll lose your saved games)

Re:Disapointing (1)

grumbel (592662) | more than 7 years ago | (#18998237)

Holy shit, MS rigged their Xboxes and 360s to self-destruct if they ever got out of the console business?

Actually, yes, they have. Or what do you expect to happen with XBoxLive when Microsoft leaves the console business. It lost sure won't stop your console from booting, but a large part of the experience will be lost.

Re:Disapointing (1)

blackicye (760472) | more than 7 years ago | (#19000145)

Holy shit, MS rigged their Xboxes and 360s to self-destruct if they ever got out of the console business?


Well actually...Xbox 360s have IBM's eFuse technology http://www.globalmanufacture.net/home/communities/ informationtechnology/techIBM.cfmM/url>

So yes, they could very well self destruct when they exit the console business if they chose. There are numerous hacks to bypass eFuse now, and presently when you upgrade the firmware on your 360 you will not be able to revert to an earlier version, because those circuit traces have been burned away.

It is also theoretically possible for them to send your Xbox a "kill signal" causing it to fry if they so desired for whatever reason.

Re:Disapointing (-1, Flamebait)

Anonymous Coward | more than 7 years ago | (#18994989)

With the prices Microsoft is charging and the hundreds of millions of dollars they are still bleeding one can only stand in awe of just how much money they are losing on the defective hardware.

Right now Microsoft is charging 360 owners:

400 dollars for the system itself
100 dollars for WiFi
200 dollars for harddrive upgrades - twice the street price
50 dollars every year to play online games
200 dollars for the HD-DVD addon
Almost everyone buys the extended warranties for the 360
And then there are all the other expensive prices for the various peripherals

For large numbers of 360 owners after two years on the market they have effectively paid between 600-1000 dollars to Microsoft.

And after all that 'maybe' next year they 'might' break even finally. I think anyone who still thinks Microsoft will endure any losses for the system are going to be in for a surprise over the next couple of years.

So really... (3, Interesting)

Tarlus (1000874) | more than 7 years ago | (#18993821)

Nintendo seems to be the only company who is actually generating a profit from their system. And the demand is still so high that they predict it'll be selling out like hotcakes till 2008.

I wonder if MS and Sony are learning anything from this... Not to say that breaking even would be a major financial loss to (especially) Microsoft, but are they really concerned one way or another about this?

Re:So really... (4, Informative)

twistedsymphony (956982) | more than 7 years ago | (#18994065)

to be clear MS is already making a profit [techspot.com] on each Xbox 360 console sold, and has been since last November (I'd be willing to bet they're making a killing with the Elite version)... 2008 simply marks the point where the Xbox division as a whole finally gets out of the red, most of that is making up with losses from the Xbox 1 which IIRC never made a profit on a per console basis.

Re:So really... (1, Informative)

Anonymous Coward | more than 7 years ago | (#18995145)

No, that isn't correct. They expect to be making a profit quarter-by-quarter by 2008. No one really knows if the 360 is profitable yet, the article you link to simply points to another article that speculates about a profit. However, we DO know that the division as a whole still posts quarterly losses. This may be overcome by next year, but they won't come anywhere near paying off the $5 billion investment anytime soon.

Re:So really... (1)

brkello (642429) | more than 7 years ago | (#18994615)

I sure hope they are learning things but that they aren't thinking about following that model. Nintendo really lucked out that their controller was a big hit. It was a huge risk and it is paying off...good for them. But I also like what the Xbox360 and PS3 are doing. I like that they are trying to put cutting edge technology in to their boxes. It allows for a lot of graphical and AI improvements. Really, anyone can make a motion sensing controller now that it is known that people enjoy that sort of thing. But Nintendo is stuck with their inferior hardware they have for the rest of this generation. If all 3 consoles do the same thing next generation and just marginally improve the hardware...it would be disappointing.

In other words, what Nintendo did was great but I really don't want 3 different Nintendos.

Re:So really... (1)

Endo13 (1000782) | more than 7 years ago | (#18995689)

I think you're missing part of the lesson to be learned from the Wii. That being that innovation in gameplay (not necessarily just in designing a radical new controller to change/enhance gameplay) can be a much better investment than simply more power and nicer graphics. In other words, it's good if games look nicer, but games have already looked pretty good for a few years now and there's a point where better gameplay is just a lot more valuable than better graphics. Most of this burden generally falls on the game developers, but then Nintendo has always done fairly well at that too.

Re:So really... (0, Flamebait)

blackicye (760472) | more than 7 years ago | (#19000189)

I think you're missing part of the lesson to be learned from the Wii. That being that innovation in gameplay


I'm calling it a fluke. Judging from their last 2 consoles, N64, Gamecube..the innovation in Wii was part calculated risk and part sheer dumb luck instead of any revolutionary forward thinking.

Re:So really... (1)

grumbel (592662) | more than 7 years ago | (#18999729)

I don't think the risk was all that big, if any at all. The Wii is making money basically from day one, thanks to being based on Gamecube hardware, so even if the Wii would have completly flopped, there is a good chance that they still would have made money from it, since the development costs for the thing could be keep quite low. And even that would have failed they still had the DS being there as backup.

Re:So really... (0)

Anonymous Coward | more than 7 years ago | (#18995137)

Component prices for Sony are dropping dramatically. The main one being the cost of the blu laser diodes that have dropped from some 100 dollars or so down to about ten bucks already. And the shrink to 65nm is starting to take place for parts of the PS3 and will be completed this year. Software emulation of the EE is working well and that extra expense is now gone for Sony. By the end of this year Sony will easily have trimmed 200 bucks off the price to manufacture the PS3.

Sony is a manufacturing powerhouse and the manufacturing costs will continue to fall rapidly with each new hardware revision just like the PS2 did.

Microsoft, well...they are stuck shopping around to various bidders who clearly aren't doing their job with the huge hardware problems the 360 has. That's the fatal flaw for a company like Microsoft that has no innate manufacturing ability.

Re:So really... (1)

bigman2003 (671309) | more than 7 years ago | (#18998209)

Honestly, I hope they don't follow Nintendo's lead.

I *like* my 360. I *like* the graphics, the sound, the HDness.

I *don't* want a Wii.

I would much rather have diversity in the market. Some people like the Wii, some people don't. If all of the companies followed the leader we would have a homogenous marketplace and I don't think we want that.

So... (3, Funny)

casualsax3 (875131) | more than 7 years ago | (#18993833)

... their games division is going to make +$5 billion between now and next year? I think he meant to say "in 2008 we expect that we will stop hemorrhaging cash out of every orifice."

black ppl (-1, Flamebait)

Anonymous Coward | more than 7 years ago | (#18993845)

black ppl

As much as I hate Microsoft... (5, Insightful)

Vrejakti (729758) | more than 7 years ago | (#18993869)

...I have to admit, they've made a lot of smart moves getting into the console industry. The original XBox faced many difficult challenges in gaining sales. However, they learned much from where things went wrong, and came out strong with the launch of the XBox 360. Perhaps their biggest advantage has been the availability of the XBox 360 at retailers during the times of Wii and PS3 shortages. Even if they haven't made a profit up to this point, the amount of market share they've picked up along the way leaves them with a very bright future.

Re:As much as I hate Microsoft... (0)

Anonymous Coward | more than 7 years ago | (#18994063)

Their future's going to be so bright, they're going to have to wear shades.

Re:As much as I hate Microsoft... (1)

drinkypoo (153816) | more than 7 years ago | (#18994437)

Perhaps their biggest advantage has been the availability of the XBox 360 at retailers during the times of Wii and PS3 shortages.

I agree on the Wii tip, but the PS3? There were shortages for about two weeks and then it began sitting on shelves. Lonely. Alone. With no one but a bunch of other PS3s to keep it company. Many people didn't even bother to come get their preorders!

Re:As much as I hate Microsoft... (1)

Applekid (993327) | more than 7 years ago | (#18994793)

I'd take issue with that biggest avantage. I'm not convinced that 360 availability in lieu of the Wii (and PS3 for, what, those two weeks?) was really that significant.

I don't think people looking for a Wii and what it brings would be ok picking up a 360 instead. Likewise, people in the market for a PS3 aren't going to be satisfied with a 360. People don't want "a video game system", they ask for systems by name.

Then again, maybe I should have asked a mall Santa Claus what the kids were exactly saying.

Re:As much as I hate Microsoft... (1)

drinkypoo (153816) | more than 7 years ago | (#18994997)

I don't think people looking for a Wii and what it brings would be ok picking up a 360 instead.

I don't have any statistics, so use the appropriate amount of salt, but I both know people personally and even remember comments here on slashdot where numerous people have said that they purchased an Xbox 360 because they either couldn't find a Wii or couldn't afford a PS3. The Xbox 360 has been the winner of MANY purchases simply by default.

Is that the biggest reason? Hell no. The biggest reason is that they were by far the first console of the latest generation to be released.

Lessons (4, Insightful)

hansamurai (907719) | more than 7 years ago | (#18993961)

Microsoft and Sony are learning something this generation, mostly that throwing the most powerful hardware you can buy at the consumer sells systems, but not at the rate you could be if you lowered your costs. I think we'll see a change in at least one of these juggernauts next round.

As for profiting, good for them, but seriously, just keep delivering good games and people will buy your system. I don't own an Xbox 360 but there's a few games coming out this year (GTA, Halo, Mass Effect, Burnout) that have me considering. I've owned a Wii, and it was great, then the supply of games I was interested in fell off, so I sold it to my brother in law. I'll probably buy another when the games I want to play start coming, mostly just Smash Bros. at the moment.

Re:Lessons (1)

drinkypoo (153816) | more than 7 years ago | (#18994119)

Microsoft and Sony are learning something this generation, mostly that throwing the most powerful hardware you can buy at the consumer sells systems, but not at the rate you could be if you lowered your costs. I think we'll see a change in at least one of these juggernauts next round.

I think that in the future we're going to see the various manufacturers/developers taking different strategies. Sony is the only company I'm puzzled about. Microsoft has already demonstrated a willingness to spend enough money to be first to market, and Nintendo has demonstrated a willingness to make the slowest but most innovative console.

I think that there is room for an expensive, powerful console. I just think Sony overestimated how expensive "expensive" could be. Obviously Microsoft did a much better job there. They also delivered a platform nearly as powerful as the PS3, while being worlds easier to code for.

I'm not sure, though, what third category is realistically left if we have one niche for slow and innovative, and one niche for fast and balls-out graphics. But I do see a shakeup coming in the actual way games companies do business, thanks to Nintendo.

Re:Lessons (1)

Kelbear (870538) | more than 7 years ago | (#18995181)

3rd category?

Fast and innovative.

It's not all that hard to imagine. The Wii itself isn't spectacular, it's main goal is being cost-effective with a small budget. It's the controller which is bringing the innovation and the controller has already been applied to various other applications.

No reason why there can't be a fast and innovative category. Nintendo could do it themselves if they want to expand in that direction. Nintendo said it plans to compete using innovation instead by performance benchmarks. But it's possible for someone to do both.

Innovation doesn't have to ditch the tried and true. Just like how new games aren't always good, and games that just do the same stuff with better execution can be a hit.

Re:Lessons (2, Interesting)

drinkypoo (153816) | more than 7 years ago | (#18995251)

I suspect that Nintendo's next system WILL be fast. Maybe still slower than the competition, but closer than this one.

Innovation doesn't have to ditch the tried and true. Just like how new games aren't always good, and games that just do the same stuff with better execution can be a hit.

by definition, the same stuff with better execution isn't innovative. it's just another iteration.

Re:Lessons (1)

Kelbear (870538) | more than 7 years ago | (#18995367)

Sorry, that was my bad. My brain must have blinked.

What I should have typed is "Innovation isn't the only benchmark for quality in gaming."

Re:Lessons (1)

drinkypoo (153816) | more than 7 years ago | (#18995415)

What I should have typed is "Innovation isn't the only benchmark for quality in gaming."

Well, I agree with that. There are several metrics by one which can measure. Innovation is definitely ONE of them, because let's face it, while many of us (including me) do enjoy some of the tried-and-true, we're also often looking for a new experience.

We've pretty much gotten to the point where most games won't benefit from more impressive graphics, though. They could look more real, but it wouldn't improve the gameplay. You can see what things are, often at a distance. So I think what we need now is innovation; new controllers, new gameplay mechanics, new output devices as well (I think we're all waiting for a more truly 3D experience, for example.)

Re:Lessons (1)

meringuoid (568297) | more than 7 years ago | (#18997661)

I think that there is room for an expensive, powerful console. I just think Sony overestimated how expensive "expensive" could be.

I think part of the problem Sony has hit here is that their competition isn't really the 360 or Wii. It's a PC, or an upgrade to an existing PC. Reasoning like: 'if I were to buy an Xbox instead of a PS3, what would I miss out on? If I instead spent the difference on getting a better video card and more memory in the new PC I'm going to buy anyway, what would I gain?'

Sony's best excuse for making such a monster is that they want it to last a long time - to still look fresh years from now. If so, they'd better be planning to drop the price steeply and soon. It won't be long before contemporary PCs are far beyond PS3.

Re:Lessons (1)

theStorminMormon (883615) | more than 7 years ago | (#18994681)

I think we'll see a change in at least one of these juggernauts next round.

I'm not as sure. Nintendo's strategy is working so far, but I don't think either MS or Sony is likely to try and compete in the "fun" gaming category. (Read: budget category.) As a general rule margins are higher in the high-end regions (see: Dell v. Alienware) and I think the real problem is that MS and Sony have failed to really capture the excitement of gamers out there. I mean the hard, hard-core gamers (the ones who call themselves hardcore gamers) are so trained to wet themselves at every new pixel count number it's Pavlovian. The gamers just below that - more hardcore than the suburban moms and dads - just weren't excited enough by the new systems to spend $500 to $600.

I expect less emphasis on hardware and benchmarks and a lower price, but I think the next gen will be a lot less about avoiding the mistakes of this gen and much more about viewing video gaming as an experience and not a commodity. Xbox Live still needs a lot of work, Sony's offering is pathetic, most games are shipping with only so-so multiplayer functionality, the launch libraries for both systems were relatively anemic: *these* are the problems that must be addressed.

We're only talking about high prices and blaming it on hardware because they dropped the ball on all these other areas. Assuming MS and Sony are in any position to make serious stabs at the next gen, I think we'll see them continue to diverge from Nintendo and casual gaming and seek to have all the other stuff - from depth of launch line-up to media player functionality - in a more finished state.

This is, of course, assuming Nintendo doesn't launch their own next gen system in two or three years (before Sony or MS can are ready) and leap ahead in both processing power AND gaming innovation. Which is possible.

Re:Lessons (1)

maxume (22995) | more than 7 years ago | (#18996709)

Nintendo makes money each console they sell. They spend less money pushing resolution into their games. Your statement about better margins in the high end market is conjecture.

That's nice, I guess. (-1, Flamebait)

Anonymous Coward | more than 7 years ago | (#18993999)

You know what else would be good? More than like four games for the 360 that don't suck. Does Microsoft have somebody working on that, or did they blow their personnel budget on guys who predict the future?

Re:That's nice, I guess. (1, Funny)

Anonymous Coward | more than 7 years ago | (#18994999)

You must have confused your PS3 with the 360. It's easy to tell the difference: the PS3 comes with 600 dollars worth of regret in the box.

Re:That's nice, I guess. (0)

Anonymous Coward | more than 7 years ago | (#18995839)

More like I often confuse my 360 with a paperweight because I hardly ever play games on it since most of them suck. They should have called it Generic Shooter and EA Ports Box.

Re:That's nice, I guess. (0)

Anonymous Coward | more than 7 years ago | (#18997139)

ha ha!!!! you paid $500 for a paperweight!!!!!!!

luser!!!!!!!

Check the box again... (0)

Anonymous Coward | more than 7 years ago | (#18996243)

You must have confused your PS3 with the 360. It's easy to tell the difference: the PS3 comes with 600 dollars worth of regret in the box.

From that description I'd say you just bought a 360 Elite and separate WiFi unit. The regret is that Microsoft was too cheap to include HD-DVD...

And you get to spend $50 yearly to bitch to other people about it over Live. So in a way, it's the gift that keeps on taking.

Hardware Repairs (4, Informative)

alvinrod (889928) | more than 7 years ago | (#18994071)

I recall reading an article a short while ago that suggested one of the main reasons that they're currently not profitable is because of the extended warrenty that they offered and the number of console replacements that they've had to make. I don't know how prevalent the problem is, but I've heard stories of some people having to send the console in for repair three or more times. I'm not sure how much of this is true, or if it's just Sony or Nintendo fanboys trying to rip on Microsoft.

I do believe that the main problems are faulty DVD drives that result in a scratched disc due to a missing component in some of the drives by a certain manufacturer and either a solder point failing or some component on the motherboard becoming unseated after the board warps slightly due to cooling related issues. I don't know if the Elite solves any of these problems by adjustments to any of the components, but I'd like to think that as they transition to 65 nm chips, they'll solve some of these other issues as well.

I haven't seen any hard figures, but I'd have to say that based on what I've read, the Xbox 360 is running into some of the same problems that the PS2 had, namely cheap hardware that fails early in the products life cycle. The disc drive on my PS2 has recently started to go bad, but I've had it for several years, but if it had happened early on Sony wouldn't have covered it. At least Microsoft is providing some good customer service. I think that everyone could save some money, however, if they'd spend more time designing and testing the product to begin with and not buying the cheapest parts available.

Re:Hardware Repairs (1)

hibiki_r (649814) | more than 7 years ago | (#18994583)

Good customer service? I guess you never had to call them yourself. They'll argue with you about having to pay for the box, about your console being in warranty, and lie about what you're getting back. I have friends in their second replacement already, because the repaired box they got lasted a whole two weeks!

And, if your console's problem is not 'it doesn't work', they'll probably tell you that they won't replace or repair anything. The drive is going bad and sounds like a vacuum cleaner? It fails to read discs just sometimes? it's all your problem.

I don't know about you, but I don't think that is good customer service.

Re:Hardware Repairs (2, Interesting)

Anonymous Coward | more than 7 years ago | (#18994855)

Don't you ever equate the pathetic 360 hardware with the PS2 again.

There are 110 million PS2s out there and they have been running for the past seven years without reports of units dropping dead. Never have people reported problems with PS2s outside of DVD lasers that eventually got dirty or needed to have the focus adjusted with the nob inside the machine. It was not until the massive 360 defect problems started to become public that we suddenly starting hearing stories where, amazingly, 360 owners claiming to have had problems with PS2s. Disgusting.

I have had consoles going all the way back to the Atari 2600 and I have never had a console fail on me or even known anyone who had a console fail. 360 owners are regularly on their third 360 unit and people on five or six replacements is not that rare and there is the current 360 dead unit king with eleven replacements.

The 360 hardware defect problem is a shameful and completely unprecedented aberration in the console market.

Re:Hardware Repairs (1)

jalet (36114) | more than 7 years ago | (#18995235)

> The 360 hardware defect problem is a shameful and completely unprecedented aberration in the console market.

I'd say Windows XX (yes, any of them) defect problems is a shameful and completely unprecedented aberration in the operating system market.

But what else could we expect from Microsoft after all ?

Re:Hardware Repairs (1)

r00td43m0n (796630) | more than 7 years ago | (#18996529)

I agree wholeheartedly.

As popular as it is to bash Sony, the PS2s' lasers would go out but the system didn't constantly fail in other areas. I'm on my 4th Xbox 360 ( Two Pros and Two Elites) and my girlfriend is on her 5th one ( All Five Pros). Not only does the system fail in all sorts of categories (mainly overheating and disc scratching), but the first Elite 360 I received, did not even recognize the 120 GB HDD. My current Elite has video connection issues because when you move the wire a certain way with some pressure the screen flickers with green and purple lines.

The worst thing about it is that the 360 has the biggest library of games and a great online service, but there hardware is terribly unreliable.

Re:Hardware Repairs (1)

tgd (2822) | more than 7 years ago | (#18995553)

And they'd be even less profitable if the replacement units had year warranties instead of the warranty ending at the end of the first unit's year.

They're going to be profitable because of everyone who has replaced one a time or three under warranty now having to buy new ones.

My second warranty replacement died last weekend. Now I'm out of warranty.

Worst part is, even if I buy a new one I have to beg them to refund my XBLA purchases so I can get them on the new box... or spend $100 buying them again, too.

That can't hurt their bottom line either...

Re:Hardware Repairs (2, Interesting)

cgenman (325138) | more than 7 years ago | (#18996191)

I'm a huge fan of the 360, so take this as you will. But that thing does fail more often than it should. In addition to what you've listed, you can add power supply failure as a major problem.

I went through 3 PS2's and 2 PS1's in their lifespans, and I got in pretty late on the PS1. I wouldn't be suprised at all if the first batch of 360's didn't last more than two or three years average for even casual gamers. Hardcore gamers: expect to replace a few.

I don't even want to know what PS3 fail rates are going to be.

Re:Hardware Repairs (1)

king-manic (409855) | more than 7 years ago | (#18999071)

That makes sense given the anecdotal evidence I've seen. Out of the 4 friends who bought a 360 all of them have gotten replacements units. One of them is on a third 360. I thought it might be locality. Maybe the truck that brought these up here hit a lot of bumps. As a side note one of my friends has gone through 3 PS2 as well. Same guy who is on his third 360. For him I chalk it up to cats, lack of 1337ness, and a short temper. He is the only person to replace PS2. All of the rest of the circle is still with their first ps2. Mine was bought a few months after launch. Still purring after 6 years. Although it seems to load slower. I bought a Ps3 to replace it and so far it work great as a Blu-ray playing Ps2... God I need MGS4.

Re:Hardware Repairs (1)

Dan Ost (415913) | more than 7 years ago | (#19000693)

Purely anecdotal, but a guy at work is on his 4th 360 (well, he's sent a 360 to MS 3 times, I don't know if they replace it each time or if they tried to repair it and send it back). It still doesn't work properly (freezes randomly every so often), but it works well enough that he's not going to do anything about it unless it gets worse.

I've got another friend who got a 360 when it first came out. He hasn't had any problems (at least none that he's admitted to).

Just thought I'd share that.

Good news (3, Interesting)

Sciros (986030) | more than 7 years ago | (#18994133)

Well, things are going according to plan it seems. Microsoft knew they'd lose a lot on the Xbox generation but would position themselves for profit in the next, and that's exactly what they've done.

Microsoft has LOTS of money, and can afford to make long-term investments that are in the billions-of-dollars range. Keyword: investments; they are not just throwing money away here. Their business model seems to be working, so good for them. (As long as it means I get to play good games on my 360 ^_^ otherwise I don't care)

I wonder what position SONY is in... is SCE looking to break even on the PS3 at *any* point in the future? Maybe, maybe not... the money they've spent on marketing alone, coupled with the losses on each console... the PS2 is probably covering a lot of that but I doubt it's anywhere near all of it.

Re:Good news (0)

Anonymous Coward | more than 7 years ago | (#18994993)

While a dig at Sony is just so quick and easy these days, I feel it's still important to point out that MS has at least $4billion~ to pay off from just the original Xbox plus whatever debt (for their department; MS has Windows and Office to subsitize pretty much everything else they do) incurred by the 360 so far.

It'll be profitable next year? Alright, but how long until it has actually paid for itself?

Re:Good news (1)

Sciros (986030) | more than 7 years ago | (#18996015)

Paid for itself = break even. From then on = profitable. So you've answered your own question.

Don't take what I said as a "dig" at SONY. The fact of the matter is, both Microsoft and SONY are fully capable of just saying "screw it we're bored of the gaming industry" and kill off that whole branch of business if they decided it's nothing more than a liability. SCE was something like $2 billion in the red at the end of the 2006 fiscal year. So, it's a genuine concern on my part. I believe SCE has more than broken even since its inception, but I wonder if, after the PS2 stops selling as well as it does now, if the PS3 will take over as the "profitable" item. (There's always the PSP, too, but that on its own probably isn't enough.)

*MIGHT* break even (1)

vux984 (928602) | more than 7 years ago | (#18994441)

Microsoft doesn't expect to make a profit on hardware alone, but "we'll probably be gross margin neutral on that over the life cycle of the product, and try to break even on that".'"

"Probably be gross margin neutral" ... "try to break even on that"

Unless, they have to lower hardware prices in response to pressure from a desparate Sony division.
Or sales continue to drop off, and not get picked up next christmas. Xbox had a GREAT christmas 2006 simply because PS3 and Wii were nowhere to be found -- next christmans will likely give consumers a real choice of all 3 -- unless Nintendo can't catch up to the Wii devouring demand that shows no sign of letting up, at least around here.

At any rate, nothing to see here. Microsoft genuinely thought 'project Xbox' would make money during its lifecycle, and made announcements of that on several occasions. That they are only announcing they're going to 'probably break even' is pretty telling.

I don't think MS is going to get out of consoles, but I wouldn't be surprised if they try a new approach for the generation.

Same Story For The Past Six Years (2, Interesting)

Anonymous Coward | more than 7 years ago | (#18994577)

Every year whoever is the latest person to be running the Xbox stuff says 'next year we will finally break even.'

The failure rate on Xbox 360s somewhere in the 30-40 percent range - and right from the latest quarterly report Microsoft indicates that having to extend the warranty period for current 360 owners and the cost of replacement units is a huge cost. The move to 65nm has been moved back to later this year and it remains to be seen if that will finally keep the 360s from failing. It has been a year and a half and from the failing 360 Elite units already it is clear that Microsoft still doesn't know what is wrong or how to fix the hardware problems with the system.

So what that means is by the time the hardware refresh hits the market there are going to be two years world of 360 units out there that are going to continue to have the red rings of death problem. That is going to be a gigantic and continuing source of losses for the division.

And then there are the moves to create a class action lawsuit for the 360 hardware defect problems. The insane prices for peripherals and the 50 dollars a year are lessing the financial blow but even that most likely won't get the division to the break even point by next year. If the break even point doesn't come before the next couple of years Microsoft is going to have a tough choice to make as they would need to start ramping up the very costly process of designing and putting in motion the next Xbox hardware.

With the dramatic drop in BluRay drive prices and Sony already moving parts of the PS3 to 65nm and quite possibly have the entire PS3 moved to 65nm before Microsoft does later this year you could very well see Sony breaking even before Microsoft does and actually paying less to manufacture the PS3 with its much more advanced tech. Sony most likely will be paying roughly the same price for a BluRay drive as Microsoft does right now for the much smaller capacity DVD drives by this time next year.

The execs up in Redmond are going to have some tough decisions to make about the future of the Xbox project. Anyone who follows the various Microsoft employee message board can attest to just how unpopular the Xbox project is with the other divisions at Microsoft.

Re:Same Story For The Past Six Years (1)

MobileTatsu-NJG (946591) | more than 7 years ago | (#18995003)

"The failure rate on Xbox 360s somewhere in the 30-40 percent range..."

I seriously doubt that number.

Re:Same Story For The Past Six Years (1, Interesting)

Anonymous Coward | more than 7 years ago | (#18995345)

I don't doubt it at all. I've seen so many reports and first-hand accounts of Ring of Death 360s that I'm surprised any of them work.

Plus they still don't have the simple matter of protecting a CD/DVD from getting scratched when one moves the console, something *every other* manufacturer has pretty much solved. Hell, I would move my Sega CD around while it was playing a CD looooooooong back in the days where optical disk-based consoles were new, and it never made a scratch on it the way the 360 does (it eventually scratched it up bit by bit, but the 360 apparently creates a huge scratch ring all at once).

If any other manufacturer had these problems, there'd be a recall, either by the company or forced by some regulating body. But apparently Microsoft is exempt from this, obvious not only from the 360 but also Windows itself.

And still people defend Microsoft. I don't get it.

Re:Same Story For The Past Six Years (1)

MobileTatsu-NJG (946591) | more than 7 years ago | (#18995425)

"I don't doubt it at all. I've seen so many reports and first-hand accounts of Ring of Death 360s that I'm surprised any of them work."

You've seen 5 million reports? You've talked to the other 50% that have operational units? You think ANY company would have a defect rate that high and NOT stop production until it's fixed?

"And still people defend Microsoft. I don't get it."

And people still attack Microsoft sans-common sense. I don't get it.

Re:Same Story For The Past Six Years (1)

Rakishi (759894) | more than 7 years ago | (#18995699)

And people still attack Microsoft sans-common sense. I don't get it.
Welcome to human psychology, it's always the other guy whose an irrational zealot and never you.

Re:Same Story For The Past Six Years (1)

MobileTatsu-NJG (946591) | more than 7 years ago | (#18995855)

"Welcome to human psychology, it's always the other guy whose an irrational zealot and never you."

Well... I suppose you've got a point, depending on which way public opinion swings. Still, though, accusations of irrational zealotry can be combated with evidence or rationale that doesn't rely on characterizations of people/companies that only Warner Brothers would be suited to animate.

Re:Same Story For The Past Six Years (1, Insightful)

Anonymous Coward | more than 7 years ago | (#18995467)

"And still people defend Microsoft. I don't get it."

There are usually two camps those people fall into:

1) The "Microsoft is always teh winner!" crowd. These are the people who constantly say "LOL! Bill Gates will just buy out such and such company with pocket change" when things are going poorly for the latest attempt for Microsoft to branch out from their OS and office software monopolies. If if they think the Microsoft product sucks they still feel an emotional attachment to Microsoft as some sort of proxy hero being able to buy their way out of any problem.

2) Former Dreamcast owners who "hate teh Sony for killing their Dreamcast with teh Hype". Still bitter after all these years they latched onto Microsoft with dreams of crushing the company that killed their crappy little console. With the failure of the first Xbox and the disaster the 360 has become this group of people are become frantically desperate as they look back and see they've been console losers for close to a decade.

Re:Same Story For The Past Six Years (1)

heinousjay (683506) | more than 7 years ago | (#18995777)

There are also those of us enjoying our working 360s. I know that doesn't fit into the worldview, though, so I'll just keep quiet.

Re:Same Story For The Past Six Years (0)

Anonymous Coward | more than 7 years ago | (#18996103)

'working 360s'

There are no working 360s. There are dead 360s and about to die 360s. Every time you turn the thing on you are getting one step closer to the dreaded red rings. The system runs so hot that the motherboard is bending with every usage and the chips attached to it will eventually no longer function.

Have fun!

Yawn @ the blatant PS3 fanboy. (5, Insightful)

Anonymous Coward | more than 7 years ago | (#18995355)

Kindly provide well founded evidence for the following of your claims:

- 30% - 40% failure rate of the XBox 360

- That failing elite units are a common occurance, more so than just the standard defect rate for any other electronic hardware

- That Bluray production prices have dropped "dramatically"

If you'd kept out the pro-Sony stuff, you could well have squeezed your pro-PS3, anti-MS troll post through, however the pro-Sony stuff is absolutely laughable, to suggest the PS3 has any chance at all of breaking even in the next few years - even if it starts selling is a complete joke. The fact that the PS3 loses far more per unit sold than the 360, and sells far less games per-unit as well as not making anything from it's online service demonstrates how utterly daft your claim is.

I'm not sure what you're on about when you suggest the 360 has extremely highly priced peripherals either, the 360 controllers are actually the cheapest out the lot, here in the UK a 360 wireless controller can be purchased for £19.99, a Wii-mote for £24.99 and a PS3 Sixaxis for £27.99. The 360 HD-DVD drive can be purchased with the premium console together for less than the PS3, in fact the only addon for the 360 that is rather extortionate is the wireless adapter which is a fair point.

XBox live is indeed pay for, congratulations on recognising that, but it's also a much better service, the term "you get what you pay for" really couldn't be more appropriate, pay nothing and get shite, pay something and get a decent service, seems like a fair compromise.

You do have some valid points, but unfortunately they're points that don't have anti-PS3 counter-arguments. It's not as if the PS3 is exactly default free when it also suffers overheating issues (which I'd argue is worse, at least MS' consoles outright fail so you can get them replaced, good luck getting an intermittently crashing PS3 replaced - you just have to live with it).

The irony of your closing statement is rather amusing, of all the players in this generation that are having to look at closing shop in the console business it is undoubtedly Sony, with the uncertainty as to whether they can turn a profit or even aquire a feasible userbase. Whilst Microsoft is starting to make money with the 360 and their general gaming division, Sony is beginning to lose it, and lose it fast.

Re:Yawn @ the blatant PS3 fanboy. (0)

Anonymous Coward | more than 7 years ago | (#18995763)

Heh, calling some one a fanboy marks yourself as a fanboy. Why be all defensive, its not like microsft/sony will come to your house and give you some of there money.

Standalone Blu-Ray readers at $300 now (1)

SuperKendall (25149) | more than 7 years ago | (#18996139)

That Bluray production prices have dropped "dramatically"

That Blu-Ray pressing costs have fallen is pretty obvious just from the number movies and games pressed - with greater numbers comes lower costs.

However we have evidence not only of cheaper disc production costs but also cheaper drives - Pioneer has announced a $299 external Blu-Ray drive (reader, DVD writer only). That's much cheaper than any external Blu-Ray drive sold to date. It's easy to imagine by next year even consumers could buy an external Blu-Ray reader, perhaps even a writer, for under $100.

I have no idea about the other points raised.

Re:Yawn @ the blatant PS3 fanboy. (0)

Anonymous Coward | more than 7 years ago | (#19002507)

The 360 HD-DVD drive can be purchased with the premium console together for less than the PS3
HD-DVD Player - $199.99
Xbox 360 Premium - $499.99

Total - $699.98

PS3 - $699.99

(all prices cdn)

So, yeah, it is one cent cheaper. Good job pointing that out.

Additionally, the HD-DVD 360 attachment will only play movies, not games. Now, I'm sure that most games don't require the extra storage space, I mean it's not like games are going to keep getting bigger. The size of a DVD should last us forever. It's not like GTA:San Andreas was an absolutely full DVD.

the 360 controllers are actually the cheapest out the lot, here in the UK a 360 wireless controller can be purchased for £19.99, a Wii-mote for £24.99 and a PS3 Sixaxis for £27.99.
Wireless Xbox 360 con - $59.99
Sixaxis - $59.99
Wiimote - $49.99 + chuk $39.99 = $89.98

Maybe your UK hardware is being subsidized more, but here in Canada the prices are virtually identical.

Just like Linux desktop? (1)

mangu (126918) | more than 7 years ago | (#18995791)

Every year whoever is the latest person to be running the Xbox stuff says 'next year we will finally break even.'


Maybe they are assuming they will break even when the Linux desktop dominates the market? Perhaps it's all planned: when Microsoft doesn't dominate desktop computers any more they will monopolize the gaming industry. </tongue in cheek>

Re:Same Story For The Past Six Years (0)

Anonymous Coward | more than 7 years ago | (#19001573)

With computer hardware, most people are aware that heat and dust are its enemy.
Same thing can be said about the xbox 360, mine was failing until i decided to open it up and take a pc duster to it, now it works like new again.
Another factor that would contribute to hardware failure is Power (weather it be the power supply or the power source), a non-grounded outlet or no surge protector can easily result in a rather...short hardware lifespan. The 360's power brick can easily be damaged by a power surge if your too cheap to spend $60 on a high quality surge protector, or ensure that all your outlets in your house are grounded.

Then again some people do not read instructions and place their game system in the tv stand and close the glass doors, then get all upset and cranky when it breaks and blame it on the manufacturer.

Poor Microsoft! (1)

a.phoenicis (1026040) | more than 7 years ago | (#18994805)

'"Xbox is the hardest piece of consumer electronics hardware to produce in the world, no debate,"

Huh?? How's that?

Can somebody explain to me just what is so groundbreaking about the xBox that makes it so hard to produce?

Re:Poor Microsoft! (1, Funny)

Anonymous Coward | more than 7 years ago | (#18995279)

it requires a specically genetically modified hamster to run the wheel. those creatures require lots of TLC and biscuits.

Re:Poor Microsoft! (0)

Anonymous Coward | more than 7 years ago | (#18995303)

Dude, have you ever tried to cram 25 fans inside your PC? Same thing.

Re:Poor Microsoft! (4, Funny)

MooseMuffin (799896) | more than 7 years ago | (#18995429)

You think its easy to build dvd drives that loud? Its not like they just buy drives off the shelf, none of them can meet their required noise level. They have to go to each dvd drive manufacturer and pick through their defect bin by hand to ensure that every 360 has that trademark sound. And we 360 owners reap the benefits. Clearly, my 360 must be super fast and powerful if its louder than my car.

Shouldn't selling under costs be illegal anyway? (0)

Anonymous Coward | more than 7 years ago | (#18994883)

I mean, sure, in a way they can lose money if they want, but in another way they're trying to eliminate the competition with loads of cash. Like criminals buy their way out of lawsuits, with loads of cash.

In a pure capitalist model they would try to eliminate the competition by offering a better product. Like justice should win in court.

Xbox live &c? (3, Interesting)

MaliciousSmurf (960366) | more than 7 years ago | (#18994913)

Correct me if I'm wrong, but aren't they making a huge pile of cash off of XBox Live? I thought the idea was to sell the console below cost, and make money off of games and services. So whether or not the hardware is making money isn't really news?

Just in time for Duke Nukem Forever! (1)

anss123 (985305) | more than 7 years ago | (#18996829)

Not to mention, it will be the year of Linux on the desktop. Hurd is finished. And Vladimir Putin goes out of office!

Good to know (3, Funny)

BlueFiberOptics (883376) | more than 7 years ago | (#18998607)

"Xbox 360 To Profit Next Year, Says Bach" It's always good to see a world famous musician forecast when Microsoft's XBox division will become profitable.

Re:Good to know (0)

Anonymous Coward | more than 7 years ago | (#18999961)

I would mod you, but there's no "unfunny" option.

Re:Good to know (0)

Anonymous Coward | more than 7 years ago | (#19001563)

A famous DEAD musician!

However, from that quote, we can deduce the following:
- time is cyclical (i.e. the "end of the world" loops back to the "beginning of the world")
- the Xbox 360 will profit "next year", which is in a few billion years, give or take a few million

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