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Syphon Filter · Aug 23, 2013

A report by BizJournals claims that ValueAct, a $2 billion Microsoft investor with a 1% stake in the company, is seeking to achieve some major changes at Microsoft. Analyst Rick Sherlund claims that big changes are going to take place very soon as other shareholders support the decision to get rid of Steve Ballmer in addition to the investment group ValueAct. According to the report ValueAct are seeking to replace Steve Ballmer because his strategy inspires little confidence.

Apparently Microsoft has no choice but to give ValueAct a board seat otherwise they might launch a public war on Steve Ballmer and Microsoft that could end with serious turmoil at the company.

A decision by the board at Microsoft to offer a nomination for a board seat could keep the activist agenda behind closed doors and take longer for shareholders to see potential benefits

Furthermore it is believed they might target the Xbox division and try and get rid of it altogether. This would allow Microsoft to focus on other products and mainly Windows.

Xbox is cool, but by our estimates Microsoft has not made money at this

http://www.eteknix.com/microsoft-investor-wants-to-fire-ballmer-and-sell-xbox-division/

Wynnebeck · Aug 23, 2013

$70 XBL Gold subscrptions incoming.

fader · Aug 23, 2013

Furthermore it is believed they might target the Xbox division and try and get rid of it altogether. This would allow Microsoft to focus on other products and mainly Windows.

uh-oh...

Silky · Aug 23, 2013

>"Microsoft Investor."

darkwing · Aug 23, 2013

errr MS not making money from Live? that investor must be ill-informed

Maximilian Kolbe · Aug 23, 2013

But they're making money of this

LumpOfCole · Aug 23, 2013

Xbox, leave home.

kurbaan · Aug 23, 2013

He is already retiring...

StevieP · Aug 23, 2013

eyekantspele said:
uh-oh...

Not uh oh. The Xbox division is still net negative as a whole (I think) and there's a reason for the distinct shift in focus for the division as of late.

shinobi602 · Aug 23, 2013

with a 1% stake in the company, is seeking to achieve some major changes at Microsoft.

Dark Octave · Aug 23, 2013

Silky said:
>"Microsoft Investor."

Sony.

Swordsman VII · Aug 23, 2013

How in the hell has Microsoft not made money off of Xbox?

Deadstar · Aug 23, 2013

Not sure if I would like a world with only two companies making consoles. I guess it could be Sony, Nintendo and Valve.

Petrae · Aug 23, 2013

So ValueAct is the 1%?

QuantumBro · Aug 23, 2013

shinobi602 said:

The funny part is that Microsoft (according to the article) has to take them seriously even though they only own 1%.

monome · Aug 23, 2013

xbox without ms is a a toddler without a mom

Curufinwe · Aug 23, 2013

Swordsman VII said:
How in the hell has Microsoft not made money off of Xbox?

Because the original Xbox cost them billions of dollars.

http://venturebeat.com/2011/11/15/the-making-of-the-xbox-part-2/

After four years, Microsoft’s Home and Entertainment Group reported a total loss of $4 billion. That number included some other money-losing ventures too. But the vast majority of it was due to Xbox and the loss that the company was taking on every machine that it made. Insiders believed that Microsoft lost $3.7 billion on the original Xbox by 2005

Kusagari · Aug 23, 2013

I would love to see how bad Microsoft's entertianment division looks when it doesn't have Xbox/Live saving it.

HP_Wuvcraft · Aug 23, 2013

I like how they just casually think that they can just get rid of a fucking console division.

Paches · Aug 23, 2013

Swordsman VII said:
How in the hell has Microsoft not made money off of Xbox?

They lost billions on the first one and RROD.

fader · Aug 23, 2013

StevieP said:
Not uh oh. The Xbox division is still net negative as a whole (I think) and there's a reason for the distinct shift in focus for the division as of late.

yea but were talking about thousands of people out of jobs. Plus can you imagine the gaming world with just one main system?

SporeCrawler · Aug 23, 2013

Interesting times indeed

Nibel · Aug 23, 2013

Guevara · Aug 23, 2013

I actually agree that Xbox has been a distraction. Did you know: Mattrick wanted to potentially spin off the Xbox brand?

JaseC · Aug 23, 2013

darkwing said:
errr MS not making money from Live? that investor must be ill-informed

Of course Microsoft is making money, but by the investor's estimates the company's venture into the console arena has, all things considered, not been profitable -- revenue means little if it's not enough to cover prior investments.

TheTwelve · Aug 23, 2013

Swordsman VII said:
How in the hell has Microsoft not made money off of Xbox?

Not as much as they've invested, thus far.

I've always wondered just how profitable it has been for them to spend money getting DLC first.

Regiruler · Aug 23, 2013

And I thought Nintendo's investors were bad.

Paches · Aug 23, 2013

eyekantspele said:
yea but were talking about thousands of people out of jobs. Plus can you imagine the gaming world with just one main system?

Do you really think some Wall Street hotshot cares about thousands of people out of jobs or the console wars if it is better for his bottom line? Not saying this will happen, it probably won't because it sounds a bit crazy, but still.

Mobius and pet octopus · Aug 23, 2013

shinobi602 said:

1% in a company like MSFT is actually quite a lot. They could be top 10 or top 20 biggest holders.

SegaShack · Aug 23, 2013

Swordsman VII said:
How in the hell has Microsoft not made money off of Xbox?

The investments they made, mainly for the first console, cost them billions of dollars. They didn't break even till 360 was out for a few years. The division has definitely has made money especially in recent years. The investment of the first Xbox was made so they could break into the console market, not make it all back on one product, and it worked.

scitek · Aug 23, 2013

shinobi602 said:

I'm guessing they aren't alone.

Analyst Rick Sherlund claims that big changes are going to take place very soon as other shareholders support the decision to get rid of Steve Ballmer in addition to the investment group ValueAct

Ishida · Aug 23, 2013

Syphon Filter said:
Microsoft investor with a 1% stake in the company, is seeking to achieve some major changes at Microsoft.

I don't know much about business... But isn't that kind of impossible...?

DopeyFish · Aug 23, 2013

LOL

What a moron... Despite taking some heat, Xbox is the one product that carries the most good will in all of Microsoft... And links together so many important content assets that are mandatory in post PC world

This is a guy without vision.

So many pieces are in play

mangochutney · Aug 23, 2013

Curufinwe said:
Because the original Xbox cost them billions of dollars.

And they gave Kinect a $500m marketing budget alone and the 360 red ring replacements and warranty extension. They've spent heaps!

BritBloke916 · Aug 23, 2013

Swordsman VII said:
How in the hell has Microsoft not made money off of Xbox?

They made loads. But they spent it on developing a new controller that looks very much like the old controller

smurfx · Aug 23, 2013

is microsoft gonna be losing any money with the xbone?

Maximilian Kolbe · Aug 23, 2013

JaseC said:
Of course Microsoft is making money, but by the investor's estimates the company's venture into the console arena has, all things considered, not been profitable -- revenue means little if it's not enough to cover prior investments.

It's profitable in past 5 years at least

Hoo-doo · Aug 23, 2013

darkwing said:
errr MS not making money from Live? that investor must be ill-informed

You think that's the only revenue stream they have? Don't be so naive.

They spend billions and they make billions. The actual profits from the divison as a whole are probably not as rose-tinted as you think.

HP_Wuvcraft · Aug 23, 2013

Regiruler said:
And I thought Nintendo's investors were bad.

"This newfangled video game thing is cool and all, but..."

kasane · Aug 23, 2013

Ishida said:
I don't know much about business... But isn't that kind of impossible...?

1% is actually quite plenty, and there might be more shareholders backing this up.

Minions · Aug 23, 2013

You can buy majority stake in Microsoft only $102 billion dollars!

1% = 2 Billion
51% = 102 Billion

2 Billion is a lot of money; Anyone have a break down of the total majority shareholders and how much (percentage) each person owns of Microsoft?

model13 · Aug 23, 2013

Pachter actually answered a question about this exact scenario a month or two ago. He dismissed the plausibility on the fact they have a 1% stake. They would need to get some serious support for this to gain any traction.

DieH@rd · Aug 23, 2013

Syphon Filter said:
Xbox is cool, but by our estimates Microsoft has not made money at this

No shit sherlock. How did you calculate that?

The Lamp · Aug 23, 2013

eyekantspele said:
yea but were talking about thousands of people out of jobs. Plus can you imagine the gaming world with just one main system?

To be honest, if Nintendo got their shit together and filled the hole Microsoft left, I wouldn't weep a single tear.

Syntax · Aug 23, 2013

HP_Wuvcraft said:
I like how they just casually think that they can just get rid of a fucking console division.

They can't? I assumed that Microsoft is perfectly capable of selling off Xbox and still being profitable.

Paches · Aug 23, 2013

If there is any division of MS I would want axed, it would be mobile. They have a great legacy of complete failure there.

ItWasMeantToBe19 · Aug 23, 2013

QuantumBro said:
The funny part is that Microsoft (according to the article) has to take them seriously even though they only own 1%.

Well, they do own two billion dollars worth of the company.

shinobi602 · Aug 23, 2013

Mobius and pet octopus said:
1% in a company like MSFT is actually quite a lot. They could be top 10 or top 20 biggest holders.

It's still not enough to make effective change in the company.

w1gglyjones · Aug 23, 2013

Nintendo should buy it

SiRatul · Aug 23, 2013

Don't know if that is accurate but if true than it's understandable that investors would say this.

Edit: Beaten

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