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So , the 360 is a big success ? err , don't think SO...

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beowulf

Banned
"Gaming has been a disastrous endeavor for Microsoft, particularly from an investment perspective," Roger Ehrenberg writes for Information Arbitrage.

Ehrenberg writes, " Making money, e.g., the creation of long-term shareholder value, has got to be the ultimate driver of Microsoft's gaming (and H&E) strategy, right? Well, after five years and over $21 billion invested all they've got to show for it is $5.4 billion of cumulative operating losses, and Xbox 360 doesn't appear to be the silver bullet to turn things around. I think it is also interesting to note that Microsoft's actual disclosure shows only Revenues and Operating Losses; I backed into and show EXPENSES below for explanatory purposes. Why might it be that Microsoft has strayed from the classic Revenues - Expenses = Profits (Losses) disclosure? Perhaps because they don't want investors to focus on the fact that over $21 billion - the market cap of a sizable independent company - has been invested in a business that has performed so poorly, with unclear prospects for improvement."

"In short, I am at a loss. Correct that: Microsoft is at a loss. $5.4 billion and counting," Ehrenberg writes.

Microsoft is "just not in sync with the Consumer Era of Computing thesis I've written about, something that Apple and others have done quite well. A hard-core high-end gaming console or a console for everyone? The Zune as the answer to the iPod? I don't know who was in those focus groups but clearly that was a mis-read from a market perspective. Are these miscues a function of unwieldy size or simply flawed strategy? I don't know, but something is clearly amiss. And these weaknesses are apparent all across the firm," Ehrenberg writes.

Ehrenberg writes, "Bottom line, Microsoft needs to take a long, hard look at its gaming strategy - and, in fact, its entire H&E strategy. At what point, regardless of its virtually endless financial resources, does it say 'enough is enough?' Would we have been better served by returning the extra cash to shareholders rather than investing it in a franchise that seems to have questionable prospects for turning around? These are the kinds of questions Microsoft management should be asking. And hopefully, for shareholders' sakes, they are."

Much more, including Microsoft dismal Xbox numbers in the important market of Japan, in the full article here.

Paul Thurrott, yes, that Paul Thurrott, writes for WinInfo, "And there are other problems with the Xbox 360, of course. Reliability of the console is so abysmal that Microsoft has had to update its warranty at least twice in order to appease customers. The Xbox 360 runs so hot and is so loud that it's almost completely unsuitable for use in living rooms, and these issues no doubt contribute to the device's horrid reliability. Furthermore, Xbox 360s are physically mangling game discs in a variety of situations, a condition to which Microsoft has yet to officially admit, 18 months after the release of the console. (As for the Zune, one could write a business text book about the mistakes Microsoft has made bringing this device to market.)"

"Microsoft needs to figure out a way to make money in this market and do so while introducing a more reliable and quieter version of the Xbox 360. If these goals are incompatible, and they may very well be, then it's game over," Thurrott writes.

http://www.windowsitpro.com/Articles/ArticleID/95806/95806.html
 

Dave2

Prominent Member
"Gaming has been a disastrous endeavor for Microsoft, particularly from an investment perspective," Roger Ehrenberg writes for Information Arbitrage.

Ehrenberg writes, " Making money, e.g., the creation of long-term shareholder value, has got to be the ultimate driver of Microsoft's gaming (and H&E) strategy, right? Well, after five years and over $21 billion invested all they've got to show for it is $5.4 billion of cumulative operating losses, and Xbox 360 doesn't appear to be the silver bullet to turn things around. I think it is also interesting to note that Microsoft's actual disclosure shows only Revenues and Operating Losses; I backed into and show EXPENSES below for explanatory purposes. Why might it be that Microsoft has strayed from the classic Revenues - Expenses = Profits (Losses) disclosure? Perhaps because they don't want investors to focus on the fact that over $21 billion - the market cap of a sizable independent company - has been invested in a business that has performed so poorly, with unclear prospects for improvement."

"In short, I am at a loss. Correct that: Microsoft is at a loss. $5.4 billion and counting," Ehrenberg writes.

Microsoft is "just not in sync with the Consumer Era of Computing thesis I've written about, something that Apple and others have done quite well. A hard-core high-end gaming console or a console for everyone? The Zune as the answer to the iPod? I don't know who was in those focus groups but clearly that was a mis-read from a market perspective. Are these miscues a function of unwieldy size or simply flawed strategy? I don't know, but something is clearly amiss. And these weaknesses are apparent all across the firm," Ehrenberg writes.

Ehrenberg writes, "Bottom line, Microsoft needs to take a long, hard look at its gaming strategy - and, in fact, its entire H&E strategy. At what point, regardless of its virtually endless financial resources, does it say 'enough is enough?' Would we have been better served by returning the extra cash to shareholders rather than investing it in a franchise that seems to have questionable prospects for turning around? These are the kinds of questions Microsoft management should be asking. And hopefully, for shareholders' sakes, they are."

Much more, including Microsoft dismal Xbox numbers in the important market of Japan, in the full article here.

Paul Thurrott, yes, that Paul Thurrott, writes for WinInfo, "And there are other problems with the Xbox 360, of course. Reliability of the console is so abysmal that Microsoft has had to update its warranty at least twice in order to appease customers. The Xbox 360 runs so hot and is so loud that it's almost completely unsuitable for use in living rooms, and these issues no doubt contribute to the device's horrid reliability. Furthermore, Xbox 360s are physically mangling game discs in a variety of situations, a condition to which Microsoft has yet to officially admit, 18 months after the release of the console. (As for the Zune, one could write a business text book about the mistakes Microsoft has made bringing this device to market.)"

"Microsoft needs to figure out a way to make money in this market and do so while introducing a more reliable and quieter version of the Xbox 360. If these goals are incompatible, and they may very well be, then it's game over," Thurrott writes.

http://www.windowsitpro.com/Articles/ArticleID/95806/95806.html


old and unjustified.

Could say the same for sonys ps3.
 

beowulf

Banned
"more reliable and quieter version of the Xbox 360"

yeah

it's called the ps3
 

Mark Botwright

Distinguished Member
Interesting read, however i feel he's missed the point of a long term business strategy. Both Sony and Microsoft are going to lose money on their consoles in one way or another. The aim is to create a large enough installed user base to whom you can sell products that will work in conjuction with the original product.
 

Corpsical

Established Member
I thought this was a PS3 forum? ... what on earth is relevant about posting that here, unless of course you just trying to cause an argument, and there appears to be enough of those already.
 

Dave2

Prominent Member
"more reliable and quieter version of the Xbox 360"

yeah

it's called the ps3

Which costs £200 more and is noisy when it kicks in. :)

If its noise you dont like you better not buy any console as the sound that comes from the speakers is loud and horrific.
 

beowulf

Banned
that sounds like a troll

i won't rise to it
 

Sonic67

Banned
With the size of Microsoft do you think they are bothered? They probably see it as shutting out other competitors to stop them growing. In the same way Chelsea may buy up all the best players to stop rivals getting them.

What all sides are worried about is a 'home everything' system succeeding in the living room which accesses the Internet, plays music, does downloads, films, photos etc.

Microsoft thought this would be the PC. Instead Sony has been heading that way which means PCs will be just for spreadsheets and word processing. If that happens who needs the latest version of Windows?

So Microsoft needed a similar rival that is more user-friendly than a PC. The X-Box plays games but can also handle downloaded films etc.
 

ProphetRNG

Prominent Member
why can't people just except both systems for their individual qualities?

They are both quality systems in there own rights, no matter what happens in the board rooms both systems will have really good games released over the next couple of years both muilti-format and exclusives, I am a gaming fan and NOT a format fan hence i have both consoles and so far Sony has disapointed me not Microsoft.
 
D

Deleted member 174041

Guest
Which costs £200 more and is noisy when it kicks in. :)

If its noise you dont like you better not buy any console as the sound that comes from the speakers is loud and horrific.


Better not buy any speakers then :D :smashin:
 

Dave2

Prominent Member
why can't people just except both systems for their individual qualities?

They are both quality systems in there own rights, no matter what happens in the board rooms both systems will have really good games released over the next couple of years both muilti-format and exclusives, I am a gaming fan and NOT a format fan hence i have both consoles and so far Sony has disapointed me not Microsoft.

Spot on, i have both consoles and iam a little disapointed in the lineup.

to the original poster, As for being a troll i was not the one who started this thread and sony have sunck 32 billion into the ps3 and they aint doing very well at the moment.
 

Dave2

Prominent Member

beowulf

Banned
haha , you got me there

:)
 

Dave

Distinguished Member
Er, where in that article does it mention the PS3 or Sony?

It's completely irrelevant to this forum, thread closed.
 
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