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[Penguins&PolarBears]

Yep. The odd post here and there in this thread saying Microsoft are still after conquering the living room seem ten years out of date. They lost any chance of dominating there years ago. To continue saying the XBox One is a Trojan Horse is laughable.

As for the XBox division itself, you're right that it really is a complete anachronism within Microsoft as a whole. The profits, such as they are, are piss poor in comparison to the investment and particularly in comparison to their core departments.

LOL. So the box that comes with Skype video conferencing, Bing search that takes over your cable box and universal search of all video apps, Internet Explorer 11, the Windows OS and Windows 8 apps, is not a trojan horse? Huh?


Microsoft didn't immediately enter the living room to dominate. They entered the living room to prevent any company from dominating the living room and then hurting their PC business. Their main goal was to stop Playstation from becoming the defacto living room computer and holding a monopoly. Now their main goal is to stop Playstation, Apple TV, Google TV from becoming the living room computer.

Also confused as to how Microsoft lost their chance to dominate the living room? If anything Microsoft moth balling Media Center and selling off their Media Room business was to say that they are putting all of their chips down on Xbox now. Did you already forget how they unveiled the Xbox One: "TV TV TV" "NFL" "ESPN" "Steven Spielberg." You spend $400 million on NFL deal, hire the programming head from CBS, get Spielberg to do a Halo show, it's not because you gave up on the living room.

 

[ec0ec0]

this is not the first time that i see this and it still surprises me...

 

[Skeff]

Amazon, Samsung, Huwaei maybe?

Well who knows, Amazon are already doing something, they've been pinching Microsoft talent for a while and are definitely quite far into their venture, I'm sure they'd be interested in some of the xbox division, but how much of it? we don't know.

Samsung could be an option, also Huwaei...

Ideally i'd like to see Sega buy it but that's not happening ever, they don't have the money.

I think breaking it up would be the only realistic solution, but i could be wrong.

 

[jcm]

Has there been anything to suggest that Apple or anybody else is interested in getting into the console market? I'm just not seeing much to suggest that there's any interest in somebody new being a player (not including Ouyu).

I can see a lot of companies simply thinking that if the mighty Microsoft can't make it work, it's a pretty risky adventure to try.

When's the last time Apple bought an established product as entry into a market? Have they ever?

 

[Clockwork5]

Looks right to me, it makes sense to sell it piecemeal or kill it.

If there is a lot more investors in the same mindset, it could be very interesting.

So a division with 5 years of continued profitability should be "piecemealed or killed?"
Isnt there a "Wii U is doomed" thread around here for you to make those recommendations.

 

[Vorg]

iXbox?

Samsung Galaxy X

 

[SenjutsuSage]

I'm pretty sure that someone with a 2 billion dollar stake in MS is just a wee bit more informed than we are.

So investors don't make dumb decisions. Getting rid of easily one of the fastest growing sectors of your business is stupidity. Correction, Xbox is the fastest growing sector of the business, not simply one of last I checked.

 

[Kyzer]

MS, why have you not just released a noob friendly PC with a controller that runs Windows 9 and called it the Xbox??

 

[Wickerbasket]

Are there sources on this stuff?

The first sheet is just financial year report figures put into an excel sheet.

The second one, I have no clue. If I was to guess, I'd say it's just the yearly profit/loss report for the Entertainment Division.

 

[robin2]

Is this accurate?

 

[maquiladora]

Samsung Galaxy X

Samsung Galaxbox


I like the sound of that.

 

[TechnicPuppet]

Well who knows, Amazon are already doing something, they've been pinching Microsoft talent for a while and are definitely quite far into their venture, I'm sure they'd be interested in some of the xbox division, but how much of it? we don't know.

Samsung could be an option, also Huwaei...

Ideally i'd like to see Sega buy it but that's not happening ever, they don't have the money.

I think breaking it up would be the only realistic solution, but i could be wrong.

MS could buy Sega attach them to the Xbox division then spin them off as a much more attractive separate company. I can dream.

 

[TheSeks]

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

Yeah, MS's made money since Moore left. The only thing I can see if them having no faith in the 720, but that killing an entire division? Uh...?

 

[Black Door]

Apple xBox

$799 and any design flaws are "fixed" by having people buy next year's model

 

[p3tran]

hmm if i had 2bil stake in ms, maybe I'd also want balmer's ass
i dont see xbox ending, but then again, I never saw coming the stupid decisions microsoft originally took for xbone.
depends who's making the calls this period, I'd guess

 

[Sandfox]

Yeah, MS's made money since Moore left. The only thing I can see if them having no faith in the 720, but that killing an entire division? Uh...?

They also probably want MS to focus on things they feel are more important like Windows and their other devices.

 

[MaulerX]

I think there's a better chance of Microsoft buying their 1% stake than anything else.

 

[Gattsu25]

I can see it now. Downloading Sony published "Playstation" branded games from the Samsung App Store on my Samsung Galaxy S6 with the latest Snapdragon processor infused with XBox technology

 

[cuevas. PhD.]

Being sold to Samsung would be the best outcome for Xbox. Brand refresh, galaxy console, proper support and a true challenge to Sony on a global basis.

You think the dashboard is bad now...

 

[Anhkow]

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/

 

[McHuj]

Is this accurate?

no

 

[Ding-Ding]

No real surprises really. Its been quite well known that the Xbox division is about as popular with shareholders as an illegitimate love child, born from an ugly women, after a drunken one night stand.

They have much bigger fish to fry and a gaming division, which has just been one headache after another is considered as a waste of resources. With all the negative press they have been getting and if the pre-order figures are less than expected, I can see the knives being sharpened for the next shareholders meeting.

 

[Skeff]

They could just spin it off, and let it sink or swim on its own. I wonder what it's worth in an IPO? $5 - 10B maybe? Tough to even guess without some actual, un-obfuscated earnings numbers.

Its possible but in this situation, I think it would just sink almost directly afterwards, right now the Xbox needs investment to make it competitive. The first 2 years of a consoles life generally needs big investments, especially going up against the PS4 as it is now.

My thoughts on other takeovers:

Samsung: yea, that's possible
Apple: They like making their own product lines and this would cannibalize Apple TV.
Google: heavy rumors suggesting their developing competition to AppleTV

I think the main interested party for this would be Samsung.

Fun discussion.

 

[jmls1121]

So a division with 5 years of continued profitability should be "piecemealed or killed?"
Isnt there a "Wii U is doomed" thread around here for you to make those recommendations.

We're coming up on a new console gen, where these loss leader expensive systems typically bleed money. Let's see if they post another profit.

Here is my main issue with all of this.

Who would be stupid enough to get into the Console market at this point?

-- Sony/MS need 8 years to reach 80 million worldwide
-- Sony took a complete bath financially, MS only slightly turned it around with Kinect
and makiing their customers double dip for the internet and netflix
--Nintendo, which is an institution synonamous with gaming, released a new console off the back of the successful Wii to terrible results

I really don't see any of the tech giants jumping to get into the business.

 

[jcm]

Microsoft didn't enter the living room to dominate. They entered the living room to prevent any company from dominating the living room and then hurting their PC business.

I honestly don't even think Microsoft expected Xbox 360 or Xbox Live to ever become as successful as they are today. Their main goal was to stop Playstation from becoming the defacto living room computer and holding a monopoly. Now their main goal is to stop Playstation, Apple TV, Google TV from becoming the living room computer.

Also confused as to how Microsoft lost their chance to dominate the living room? If anything Microsoft moth balling Media Center and selling off their Media Room business was to say that they are putting all of their chips down on Xbox now. Did you already forget how they unveiled the Xbox One: "TV TV TV" "NFL" "ESPN" "Steven Spielberg." You spend $400 million on NFL deal, hire the programming head from CBS, get Spielberg to do a Halo show, it's not because you gave up on the living room.

MS's defense of Windows using the Xbox against Playstation reminds me of the Maginot Line. They spend a ton of resources defending against the frontal assault on the German border. Meanwhile, the tanks of Apple and Google are rolling through Belgium.

The "living room computer" is the tablet in your lap while you watch TV.

 

[DigitalOp]

So the Xbox was a damn charity to gaming................


Mega fucking ton

 

[Skeff]

I think there's a better chance of Microsoft buying their 1% stake than anything else.

That 1% is currently valued at around 2 billion isn't it? 1% is sometimes very large.

 

[elohel]

400 mil NFL deal.

LOL

No idea why this made me laugh

 

[Commanche Raisin Toast]

Its not that inaccurate.

They didn't own Skype nor have Windows Phone when they were racking up those big losses.

They've lumped all their duds in the division, Kin, Zune, but those would be placed in those years where the division made money.

I think you guys are not understanding the context of this investors comments. On a technicality, the Xbox division has made money in some years. But it ain't making Office type of money, or Windows type of money, and thats what these investors are looking for. They want the home run, not something that can only give you lead-off singles. These institutional investors want money poured into something with a big payoff, not something that just makes a tidy little profit, or keeps itself afloat, or god forbid gives losses.

This. To investors the Xbox division looks like a kid that never moved out and won't get a job. Draining funds from the parent company and not quite making it all back quick enough. That mixed with surface doing poorly and you can see why consumer devices aren't looking like a good idea.

Also, while playing the long game can be smart, it's also important to be agile and be able to change course quickly if new technologies or markets take off suddenly.

Also also, that chart doesn't point out that PlayStation is just a division of the larger Sony corporation, and so is Xbox/consumer electronics for Microsoft. Nintendo has no division to server if the company begins to downward spiral, while the other two could just stop the bleeding if they wanted to. (Although PS division and insurance division are actually profitable right now and it's their other sectors that are iffy...)

 

[Quixz]

I'm sure Samsung or Apple would buy the Xbox division.

 

[leatherhat]

Part of Samsung's entrance into many markets is partly vanity based. They are actively going after every market the Japanese are in. Videogames is the next option. Remember Samsung are involved in making literally everything.




They wouldn't call it that, it's not got the global appeal. It'd be something Galaxy based.

The xbox galaxy. I kind of like that.

 

[jcm]

Its possible but in this situation, I think it would just sink almost directly afterwards, right now the Xbox needs investment to make it competitive. The first 2 years of a consoles life generally needs big investments, especially going up against the PS4 as it is now.

If it's going to need big investments for the next several years then maybe it's not a very good business. That would explain why ValueAct wants to get rid of it.

 

[abadguy]

The xbox galaxy. I kind of like that.

That actually does sound cool in a weird way.

 

[kidhero1000]

Microsoft (MSFT) opened solidly higher Friday after the company announced that longtime CEO Steve Ballmer would be stepping down “within the next 12 months.”

The move comes amid years of struggling on the part of the PC-centric giant, despite the stock’s market-beating year-to-date run.

Microsoft’s mobile efforts recently ran into a brick wall, with the company recording a $900 million writedown on its Surface RT tablets as it failed to gain much traction against competitors like the Apple (AAPL) iPad, among others.

That writedown hammered Microsoft’s fourth-quarter earnings, which came to $5 billion — a jarring pivot from three months before when MSFT reported go-go Q3 profits of $6.06 billion. That led to a sizable selloff in Microsoft stock, which cut into a sizable 2013 rally.

Nonetheless, Steve Ballmer’s time at Microsoft has been marked by stagnant stock performance — MSFT has traded between the high $20s and low $30s for most of the past decade — leading some to question whether the clock was ticking for Ballmer.

In a Microsoft press release, Ballmer said, “There is never a perfect time for this type of transition, but now is the right time,” adding that the company needed a CEO “who will be here longer-term” as the company “transforms to a devices and services company.”

Microsoft has appointed a special committee to find Steve Ballmer’s replacement that includes Chariman and co-founder Bill Gates.

Kyle Woodley is the Deputy Managing Editor of InvestorPlace.com. As of this writing, he did not hold a position in any of the aforementioned securities.



http://investorplace.com/2013/08/steve-ballmer-stepping-down-at-microsoft/

 

[bengraven]

Sega Xbox.

 

[Avinexus]

Its not that inaccurate.

They didn't own Skype nor have Windows Phone when they were racking up those big losses.

They've lumped all their duds in the division, Kin, Zune, but those would be placed in those years where the division made money.

I meant inaccurate in that the title claims that it is solely for the gaming division, which it isn't, making it completely inaccurate for what it is trying to show the user.

Is this accurate?

No, neither is the blue bar graph.

 

[PJV3]

Go into a partnership, MS supply the OS and the partner the hardware.

 

[Penguins&PolarBears]

MS's defense of Windows using the Xbox against Playstation reminds me of the Maginot Line. They spend a ton of resources defending against the frontal assault on the German border. Meanwhile, the tanks of Apple and Google are rolling through Belgium.

The "living room computer" is the tablet in your lap while you watch TV.

I sort of agree with you on this. Except Microsoft has been trying to push tablets for the better part of a decade and has pretty successfully redesigned Windows itself to put tablets first. It wasn't like Microsoft was caught unaware of the importance of tablets or that they aren't fighting hard to win the tablet battle.

Part of that NFL deal I mentioned is making all of the NFL coaches use Surface on the sidelines of NFL games.

The reality of the situation is just that Apple is a much more formidable consumer electronics competitor than Sony has been. Microsoft is pretty aggressively attacking the iPad now though. There are tons of Windows 8 vs. iPad commercials that Microsoft is producing. Microsoft Stores are being raised near every Apple Store in North America.

Where I also sort of disagree with you is that regardless of how important you believe tablets are, Google/Apple/Microsoft all think controlling the TV screen is incredibly important.

 

[maquiladora]

I'm sure Samsung or Apple would buy the Xbox division.

These investors don't live in a vacuum. If there are indeed a group of likeminded investors I wouldn't be shocked if they have had informal chats with representatives.

 

[Ploid 3.0]

So the Xbox was a damn charity to gaming................


Mega fucking ton

No, it was a attempt to win over the living room. Phase 4 is in process. Their kinect always online, always gathering information, to the living room what google is to browsers plan is getting a bit thin now that they are dialing things back. They can still sell ads, and figure out your habbits.

 

[Linkified]

Urgh at least Gates is still Chairman of the Board.

 

[Anticitizen One]

I'm sure Samsung or Apple would buy the Xbox division.

Apple absolutely would not

 

[BlastProcessing]

When's the last time Apple bought an established product as entry into a market? Have they ever?

Siri kinda sorta?

 

[Ogimachi]

Why would Amazon want it?

Rumor has it that they're developing a console. They'd probably be interested in established brands and studios.

 

[Broder Salsa]

SEGA going to buy it.

Then take over the world.

 

[abic]

No, it was a attempt to win over the living room. Phase 4 is in process. Their kinect always online, always gathering information, to the living room what google is to browsers plan is getting a bit thin now that they are dialing things back. They can still sell ads, and figure out your habbits.

Technically you call it a loss leadership strategy, where you incur losses to get a leadership position in the space.

What I'm surprised about is loss leadership for 10 years, and the overall net loss. Xbox has done a fantastic job in the USA, funded by Windows and Office.

Fascinating. It also sends out a signal to other potential entrants to the console space what kind of losses they would have to incur to secure a foothold in the industry today.

Calling it a charity is not wrong in some sense, these dollars were subsidized.

 

[troushers]

LOL. So the box that comes with Skype video conferencing, Bing search that takes over your cable box and universal search of all video apps, the Windows OS and Windows 8 apps, is not a trojan horse? Huh?

No. Even if it got into households in large numbers it has stiff competition for all of those functions. It has to provide video conferencing and internet more conveniently than a tablet, and it will always fail at this function since it is tethered, whereas a tablet or smartphone is portable. It has to work not just better -but $400 better- than inbuilt TV, cable box or Bluray functions. Think of it it this way - it is still a Trojan horse, but Ulysseus spent so long designing and building it that a bunch of barbarians have already sacked and looted Troy, and there is little left but scraps for the Greeks, who are trundling up manfully in their archaic technology, plastered with adverts for Bing (Who he?) and Skype (Did you mean facetime?).

A true trojan horse these days would probably be a minimal, integrative DVR with a portable tablet controller. So it's a trojan you would envisage a decade ago.

 

[limaCAT]

If msft gets rid of xbox its not like xbox will cease to exist, it will be sold to another company or perhaps the ieb div or whatever they are called will become its own company.

After 1983 Mattel sold all the assets of its Electronics division, but that did not mean that the Intellivision had any real future expansion other than being sold as a cheap console in supermarkets and thrift stores.

 

[Nocturno999]

Well, they already lost the living room which was the main reason of the Xbox venture.

 

[Diddy Kong]

SEGA going to buy it.

Then take over the world.

NO WAY.

Spoiler

SEGA-Sammy is going to buy it