Yeah, seven years after the original Xbox was released. If this was the plan all along, there would’ve been no way in Hell that the Xbox project would have been green-lit had it been anyone but Microsoft. It has cost the company billions already, which isn’t a very favorable position when dealing with shareholders.
From eWeek via Next-Gen.biz, Robbie Bach, president of Microsoft’s Entertainment and Devices Division, states that through peripherals, software sales (1st and 3rd party titles), and Xbox Live, the Xbox platform will finally see a profit next year. Welcome, Microsoft, to the club that Nintendo has been a part of since, well, forever.
This fact just goes to show you how much money Microsoft can afford to waste on something like a gaming console. They’ve lost billions of dollars in the last seven years, but are still going into the console market with all guns blazing. Why?
Because Microsoft sees the console gaming space as the way into the all-inclusive home entertainment market, much like what TiVO is doing. They know that’s where the future lies for consumer electronics, and they’re dead scared of Sony getting there first. Microsoft is going to do everything they can to get a hold of that pie, and Xbox seems to be their way in. So no, even though they’ve lost billions at this point, they’re not going to give up anytime soon. If they do, Sony will win.
I’m actually surprised it’s taken this long for them to earn a profit with the 360. Live seems like it would have recouped the losses months ago, as there would be very little overhead for the service at this point. All they have to do is sit there, watching their profits soar. It’s working for Nintendo with the VC, and that service is seriously gimped compared to the Marketplace.
But I’m glad that Msoft is finally seeing some scratch with the Xbox. For all the crap I’ve given them in the past, if they weren’t around, online gaming would still be a PC-only affair, and Halo would have been the killer app for Macs. And that’s just not cool.