RF Generation Message Board

Four years after the fact, Microsoft is still losing mucho dinero on Xbox.  At least this year they cut it down to hundreds of millions of dollars, rather than billions like the previous three years.  (Sarcasm.)

Full Article: http://gamesindustry.biz/news.php?aid=10288

It's crazy they're still going to make an xbox 360. Even if that thing makes a profit, it'll be nearly impossible to recover the losses from the xbox.

Its an acceptable loss if they are trying to kill their competition.  After that, they will have plenty of oppertunity to make up the lost money.

I'm praying for that not to happen.  They've already (partially) done it in the computer world, and if they do it in the video game world, I will be very, very pissed.  I refuse to own a system made by Microsoft.  Although, if worst comes to worst, Nintendo will become to the gaming world what Macs are to the computer world, and the true fans will stick to their roots.  But that's just my opinion.

i was under the impression that Nintendo was already that way.  The game cube seems to really be geared towards children in a way the other two are not, much in the same way that Macs are geared towards video and photo guru's and everyone else uses PC. (Except for the DoD, which uses Mac servers because no one cares to find out how to hack a Mac.)  

In the end, the Microsoft consoles will meet or surpas the quality of the other offerings, or at least they should with the money Microsoft is throwing at them.  But they are still very new to the concept of the console.  

On a side note, it would be really nice to get a few forum members from Japan, given that they are respondible for the majority of consoles/games on the market.

Well...then I guess I could be considered a "true fan." |D

I'm not really sure what to think of this remark. You make it seem as if it matters wether a company is new to the concept of the console. Wasn't atari new to it when they started? Wasn't Nintendo new to it when they released the nes? Wasn't sony new to it when they released the Playstation?

And in the end it's still the game developers making the games. It doesn't really matter wether the new metal gear solid gets a release on a nintendo, sony or microsoft console. So it also doesn't really matter wether or not any company is new to making consoles.

Microsoft make so many bazillions of dollars, that it might suit their purposes, tax wise, to take a loss on something.....

The console does matter though, I wouldn't even consider getting an Xbox because of the controllers and the overall size of the beast.  Look, feel and company reputation all come into play when someone looks to buy a console, so who makes it, and if it is their first attempt, matter greatly.

And my point was, they will only get better.  Yes, their first system wasn't very good, but the next ones will improve.

I don't think so. Sure, all new consoles were technically better than their predecessors, but if you judge a console on its own merits, few will say the snes was better than the nes, or the saturn better than the genesis. If there's one branch where companies don't learn from their own mistakes it's the game industrie. Just look at nintendo, whose consoles have gone down hill since the nes.

Look, feel and company reputation may matter to you, but many people don't care as much about these details like you. Great marketing can provide these last two and the first one has nothing to do with the manufacturer. The mass of the people doesn't hate microsoft or care that much about the size of a console, because they will only buy one. And as long as it churns out madden better than other consoles they're happy.

I understand how teh N64 was worse then the SNES and there are problems with the GameCube but how was teh SNES worse then the NES?

Well, maybe not worse, but the nes certainly was the more popular one.

Personally, I think that Nintendo's systems just kept getting better up until the N64, which should have been a disk system.  After the N64, the GCN was released, and that was a big improvement over the N64.  But really, the systems don't matter nearly as much as the games that are on them, and Nintendo has, in my mind, always won in that department.  Of course, I'm a big fat fanboy. |D

And Dreamcast was an enormous improvement over Saturn, but look where that got Sega.

Yeah... :'(

Don't cry.  You'll still be able to buy overpriced Sony consoles so you can get them repaired five times a year, and Microsoft consoles which in one more generation will just be a PC.  It's okay.

YAY!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!

My playstation 2 is still working great, but both my dreamcasts often mess up....

My first PS2 died on me.

I got a PS2 right when it came out.  I've had to use a DVD Cleaner on it a couple times, but other than that I haven't had too many problems.

And let's not forget that the saturn cost 520 euros when it was released here in 1995 (including virtua fighter).

Losing money on hardware to sell the software is nothing new. When Atari came out with the 2600 it was actually part of their continuing marketing plan to sell the hardware at a loss and profit on the software. (I am currently reading The Ultimate History of Video Games) There have been other instances of this marketing plan as well. I'm sure everone likes to profit but perhaps Microsoft doesn't/didn't feel it was worth it to persue lower production costs on the xbox hardware when they made money on the games.

You're missing something huge here, nupoile.  Microsoft's Home and Entertainment division has taken NET LOSSES of billions of dollars over the past few years.  This is AFTER any money they made on software, so it's not the same thing as Atari losing money on consoles and making money overall after software sales.  Translation: any other company would have gone under a long time ago.  Microsoft just has billions in the bank and from their computer division.

...ah, yes you are right, I missed that part.

It's kinda easy to miss though I guess, because numbers like that seem obscene.

Also keep in mind that the cost to make a modern game is much, much higher than games that appeared on the Atari consoles.  Making something like Centepede is down right easy when compared to writing a 3D engine.   I don't know how much most of the old Atari games sold for, but even if they were half the price of current games, I would guess that there was much more profit in the old Atari games on a per unit basis.  

Actually, it's not really true that profit margins were higher back then, because for one thing the physical video game cartridges cost an enormous amount more in comparison to an optical disc.  Also, video games were not a mega-billion dollar industry back then.  There weren't games that sold a million copies the day they released.  There were no GTA's that sold tens of millions of copies at $50 a piece.  In other words, the userbase just was not there.  The programming process may have been less time-intensive, but they really didn't profit more back in the Atari days....  especially not at Atari, which if you know anything about video game history was sold due to a complete lack of finances.

This is just my spin on it.
The more Microsoft is losing thru sales translates to more loss for the competition because even with their loses they were ahead of the competition in sales (if i remember correctly Xbox did pull ahead of both cnosoles i know it was ahead of GCN)

So even if they are losing money now they figure they can make it up later as the competition is slowly choked out.

Both Sony and M$ have alternate revenue to take money from to fund their gaming sections if they do acrew loses. Where as Nintendo has only gaming to rely on for revenue.

IMO that is one of the reasons Sega went out of buisnes because the amount of revenue they could make off the home console market was not enough to compete with Sony(who is in all facets of technology ) and Nintendo (consoles and handhelds). So once Sega was pulling in net loses they had nowhere to take money from to fix the problem.

So once nintendo console sales or game sales slow down to much they are going to have to pull out of the market or part of the market.
The more diverse a major company is in the market the more likely they are going o be to succeed.

IMO MS and Sony are in it for the long haul. So long as they are leaders in any of the other markets they are in they will be able to fund their gaming ventures.