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[Moofers]

Selling Xbox would be a huge mistake. There's so much potential with that brand and so much recognition for it now. I mean it has absolutely caught fire in the west these last 5 or 6 years. They'd be crazy to let go of that!

Mindblowing if true. I hope its not. I want to see Xbox stick around! Master Chief needs a house!

 

[sono]

Not that surprised at these murmurings, it has turned for the 360 that despite launching 1 year ahead of the competition they are currently last worldwide of this generation, and the xbone launch has not been received that well, in fact their reputation has possibly also suffered from the changes in their policy around that.

I cant see them selling off the division though, its sounds more like lets throw some mud around in frustration

 

[Mass Effect]

Holy crap, imagine if Valve could buy it.

Steam workshop support, cross-platform digital games.

That would be amazing.

It would be. Too bad it's just a pipe-dream. They're too small of a company.

Shouldn't be a surprise. They took some lumps with the first two consoles.
Doesn't mean XBOne will lose money and I think there's zero chance that Microsoft would ever dreamcast it, but that doesn't mean they won't pull the plug on the gaming division after this gen.

From a gamer's POV, it should be a concern. If somebody doesn't pick up the pieces and provide adequate competition, we're going to see a $900 PS5.

I seriously doubt that. Given the increased competition from PC and especially tablets and even smartphones, there's no way Sony or even Nintendo would be able to get away with something like that. People would simply move to PC (hardcores), tablets/smartphones (casuals), or do without.

 

[evilromero]

I can see MS dumping the Xbox brand. Just not sure who would want to buy it.

 

[LEGEND0F117]

Is anyone worried about this?

Because I sure as hell am.

 

[Petrae]

The possibility of a Samsung purchase of the Xbox division-- even in a remote, .000001% chance of happening-- intrigues me.

I think that could be really interesting. Heck, rename it the Xbox Galaxy for cross-branding, put some more resources into Smartglass second-screen, bundles with TVs... and those ideas are just off the top of my head.

Most likely won't happen, but fun to think about.

 

[Nymphae]

That would be a huge 180.

 

[Y2Kev]

Did no one tell this braindead fella that when you do a long term investment, and have alreayd written off billions of dollars to estabilish it, then you do not start to conspire against that project within the company when it is starting to generate profits, you know...

... I mean, what the fuck?



What Econ level is this? You launch a longterm project, eat up 7,000,000$ over a course of a few years. You arrive at today, and you have brand power, a huge marketshare, and you have a rolling subscription service that generates profits. What do you do with such a project?

Because if I were to turn this into an "econ 101 problem", the question would be: would you sell such a project at this point, or would you buy this project, since its estabilishment costs has already been paid off by its previous owner?

Sunk cost is a concept from intro to economics.

 

[Voidance]

That article is wrong. Gates doesn't have anything like 25%.

It's also worth noting that those big mutual fund holders are all index funds, that don't have a choice in how much MSFT they keep. I'm not sure how they handle their proxy voting.

Right you are. Not sure how the Bloomberg writer messed that up.

 

[I H8 Memes]

Surprised by how many people were not aware about how much money the Xbox division has lost. Windows is their money maker. Microsofts war against PC gaming just shows how cannibalistic their corporate culture has become. They are damaging the reputation of their main source of revenue just to prop up the Xbox division. If someone would just come out with a competent OS with its own API for games I would drop Windows in a heartbeat. Most PC gamers would. That's how damaging their Xbox division has been to Windows.

 

[Timeaisis]

It's understandable that investors would want to get rid of a division that became consistently profitable after Don Mattrick took control? LOL.

Bing is just now starting to become profitable after billions in losses. All the investors who were calling for MS to sell Bing are now looking like idiots. When your business becomes profitable that is not the time to get rid of it.

This topic is such a fanboy wetdream. Xbox is strategically important in fighting Google and Apple with services like Skype, Bing, Xbox Music & Video, Skydrive, etc.

Without the Xbox foothold in the living room all of Microsoft services take a hit. Apple promotes FaceTime over Skype, Google promotes it's search in the living room over Bing, etc. Not going to happen.

I see your point, but it really depends on their other financials. I'm no economist, but numbers are numbers. But strategically, I agree with you that dropping the Xbox would be giving up a large market share, and lots of potential future revenue for a focus on OS and PC software. Which, by some accounts, may be what MS needs right now. Financially speaking.

 

[BritBloke916]

i doubt it. the next playstation will be a service that you can subscribe to using a playstation box or one of many other sony devices. eventually they'll be implemented into sony televisions themselves without the need for extra hardware.

I can see the PS4 APU serving as the beating heart of Sony smart TV's within the next few years (next fab. process, maybe)

 

[killer rin]

Does anyone see Xbox One being profitable?

The R&D must have been astronomical. And the moneyhats are out in full force. Plus all of the dedicated servers they are subsidizing.

And if the system doesn't sell as well as the 360, I can't see the XB1 being profitable.

Technically the server costs get put to Azures cheque book within the company. The servers are going to be there anyways, and Azure is a major business for Microsoft.

 

[Endo Punk]

Is anyone worried about this?

Because I sure as hell am.

No need to be. This reminds me of the doom and gloom PS3 articles back in the day, nothing became of them and it will be the same here.

 

[Maximilian Kolbe]

Probably a larger investment into improving Windows, breaking into the mobile sector, expanding beyond PCs, etc.

Something to improve the current health of their main businesses.

Extra millions in all their enterprise stuff like Windows Server, Office, stuff like that.

So why you think Xbox isn't their main businesses for now or future?Xbox isn't about gaming anymore

Well,they can keep trying for every year

 

[jmls1121]

Watch Zynga buy it, with Mattrick at the helm.

Its a twist!

 

[InsaneZero]

ValueAct actually wants to dump most consumer stuff so that would include Windows Mobile.

Would it? Considering the ever-expanding importance of smartphones and tablets in businesses, I would think that Microsoft should be improving their current status in that sector in terms of enterprise-level software.

 

[Beer Monkey]

I've got a business degree. Now, it's just a bachelor's (Information Systems), not an MBA, but I had to take two terms of finance, three of economics, three of accounting, one of operations management, et al.

No offense, but if half the people in this thread had ever taken one finance class, the discussion here would be completely different. The amount of ignorance so far is, well, understandable, I guess. It's a gaming fan site.

 

[Charrettizard]

This is why few companies want to get involved with the game industry - well, at least in the traditional sense. There's a very real chance you might spend a lot and lose even more, and it is the business equivalent of a high roller game of Texas hold' em. So while many of you scoff at the idea of Microsoft selling off it's Xbox division, please consider the fact that neither Apple or Google (both companies are also public) have truly entered the industry, and their hesitance is probably an indication that it just too risky of a prospect to really invest in.

Also, didn't Nintendo suffer their first loss in fiscal 2012?

 

[Slamtastic]

Plus can you imagine the gaming world with just one main system?

The only thing multiple game consoles (and handhelds and PC) achieve is exclusives that I can't play because I'm not made of money for multiple multi-hundred dollar machines for one game.

 

[BritBloke916]

When your business becomes profitable that is not the time to get rid of it.

Actually that's the best time to sell it, because that's when you actually can.

 

[LEGEND0F117]

I like Xbox despite all the hate.

I'm glad someone decided to enter the console business and I'm glad it was Microsoft.

I said it.

Xbox would of never became what is was without pappa MS.

Love it or hate it its true.

 

[Seeds]

EA? (the end of gaming as we know it)

Xbox Origin (uses Origin)

- Madden pre installed in the US and Fifa pre installed in EU at launch.
- Huge marketing campaign telling consumers Fifa and Madden are exclusive.
- All EA titles obviously exclusive.

Would be fun to see how Sony handles that situation.

 

[InsaneZero]

So why you think Xbox isn't their main businesses for now or future?Xbox isn't about gaming anymore

Well,they can keep trying for every year

There's this little thing called Windows...

 

[Shalashaska161]

I can see MS dumping the Xbox brand. Just not sure who would want to buy it.

Yeah that's the bigger question. The new CEO may want to refocus Microsoft to their core business strengths, and if the XB1 struggles then I could easily see them dumping it. But who would buy it / be able to afford it? The only company I could really see is maybe Samsung, and I have no idea if they would want to enter the gaming market.

 

[starwarsfan541]

Watch Zynga buy it, with Mattrick at the helm.

Its a twist!

It would be..... interesting to say the least.

WI Nintendo Buys it?

Or if its split up.

 

[AmFreak]

Econ 101. You have 1 dollar to invest. Investment A returns 25%. Investment B returns 15%. Both are profitable. You take Investment A. The opportunity cost of B is that your return is lower than if you took A.

It doesn't matter if the Xbox division is profitable. If it's not the maximum possible return on investment (and there are a lot of factors at play here, it's not exactly cut and dry), then it's a negative proposition.

Nice example. Only problem is there is no investment A here. If there was they would invest in both, cause they are not thin on ressources.
The Xbox division can potentially generate billions of profit per year and can cement there leadership / monopoly in other markets. Selling it, after getting nice profits out of it, after eating billions in looses doesn't make sense for them. There is no real gain in selling for them.

 

[BritBloke916]

Xbox Origin (uses Origin)

- Madden pre installed in the US and Fifa pre installed in EU at launch.
- Huge marketing campaign telling consumers Fifa and Madden are exclusive.
- All EA titles obviously exclusive.

Would be fun to see how Sony handles that situation.

They'd enter a stategic relationship with Activision for mutual survival.

 

[Furyous]

That investor saw that report about the $100 million cost of the Xbox One controller and started plotting. I easily see them losing money this fiscal year as result of marketing, manufacturing, and strategy changes to the Xbox One. I can't imagine the cost of a free FIFA pack-in game to Microsoft in Europe.

Having said that, this is not happening anytime soon. There's a better chance of a $20 XBL tier than this.

 

[bidguy]

The only thing multiple game consoles (and handhelds and PC) achieve is exclusives that I can't play because I'm not made of money for multiple multi-hundred dollar machines for one game.

yeah because it would be so good with 1 company monopolizing the whole industry

 

[numble]

Because if I were to turn this into an "econ 101 problem", the question would be: would you sell such a project at this point, or would you buy this project, since its estabilishment costs has already been paid off by its previous owner?

You must've had a bad Econ 101.

 

[Ninja Scooter]

Should sell the console division to Sega.

That's like saying George Clooney should sell his Bentley to Corey Feldman.

 

[EatinOlives]

What part of "enterprise focus" implies doubling down on Bing and Surface? Do you know how MS makes money?

More failed ventures is the answer then?

 

[TheUnsunghero26]

Not that surprised at these murmurings, it has turned for the 360 that despite launching 1 year ahead of the competition they are currently last worldwide of this generation, and the xbone launch has not been received that well, in fact their reputation has possibly also suffered from the changes in their policy around that.

I cant see them selling off the division though, its sounds more like lets throw some mud around in frustration

Companies care more about money made rather than units sold. Do we even know the exact numbers of both 360 and PS3?

 

[BleachAndPepsi]

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

I'm not saying he's got the best idea here, but let's not be silly. He's obviously pretty damned intelligent and has enough vision to get to the place he's gotten to in life.

 

[lordchompy]

Of course Microsoft hasn't made money on Xbox 360.

I'm sure they've learned their lesson for Xbone.

 

[twobear]

Who would potentially buy it, I wonder?

 

[JaggedSac]

Has anyone mentioned that those graphs are for the Devices division as a whole and do not relate directly to XBox related losses or gains? WP is in there, probably Surface too.

 

[Beerman462]

But I doubt these investors are actually thinking about these things in those terms. More than likely they're pissing themselves over the bottom line and demanding sweeping action with little regard of the fact that the gaming division is one of the more promising ventures from Microsoft. What else are they supposed to focus on? Bing? Windows Phone? Surface? Those are more promising than the gaming division? Please.

Considering 900 million phones were sold in 2012 and almost 50 million tablets sold in the fist quarter of 2013 vs 247 million 7th gen consoles sold over 8 years. I'd say focusing on breaking into those markets with any significant market share might be important to MS. The only numbers I could find for PCs was from 2011, but that was 355 million. So yes I would say anyone of these markets is more promising from a profit standpoint than game consoles.

 

[Joni]

More failed ventures is the answer then?

What are their failed ventures in the enterprise space?

 

[Alcoholikaust]

1% is still a tiny amount when looking at the whole pie...

right?

 

[patapuf]

Nice example. Only problem is there is no investment A here. If there was they would invest in both, cause they are not thin on ressources.
The Xbox division can potentially generate billions of profit per year and can cement there leadership / monopoly in other markets. Selling it, after getting nice profits out of it, after eating billions in looses doesn't make sense for them. There is no real gain in selling for them.

Do you really think the Xbox one will sell that much better than the Xbox360? because if it doesn't, there may be profits but they won't be high enough for MS investors. For a 10+ year investment the XBone needs to take off. Or MS will have built their last console.

 

[Maximilian Kolbe]

No need to be. This reminds me of the doom and gloom PS3 articles back in the day, nothing became of them and it will be the same here.

For Sony it just not old PS3era though,i remember i read a similar news(like this one) at this year
But yeah,both are not gonna do that

 

[dragonbane]

That article is wrong. http://data.cnbc.com/quotes/MSFT/tab/8]Gates doesn't have anything like 25%.

It's also worth noting that those big mutual fund holders are all index funds, that don't have a choice in how much MSFT they keep. I'm not sure how they handle their proxy voting.

Wow. So 1% is pretty big then. Going to be interesting...

 

[vdo]

Damn 1%, leave Xbox alone!

 

[Beer Monkey]

You've certainly raised the level of discourse in this thread. Thanks for dropping all that knowledge on us, rather than posting your CV and dropping the mic.

The thread was already toast when people started bullshit graphs.

The bottom line is Microsoft's financials are only segmented down to the Entertainment and Devices division (including not just Xbox but also money sinks like Zune, Kin, Windows Phone 7, and even products like Skype) but we've got a bunch of Charts From My Ass that pretend to track Xbox profits. This thread is fucked and most of the posters are here to parrot what they want to believe.

 

[Joni]

1% is still a tiny amount when looking at the whole pie...

right?

One of Microsoft's 20 biggest investors.

 

[V_Arnold]

Sunk cost is a concept from intro to economics.

Then I am glad to have never taken it, for I find the concept of Microsoft considering throwing away the most positive piece of brand they have since....well, since a long time that reaches a good demographic, and is estabilished by now, built through their money and energy. It screams "SHORT TERM THINKING" to me.

 

[jmls1121]

yeah because it would be so good with 1 company monopolizing the whole industry

Umm, there are 2 consoles. You may not be interested in it, but just saying.

 

[la flama blanca]

I've got a business degree. Now, it's just a bachelor's (Information Systems), not an MBA, but I had to take two terms of finance, three of economics, three of accounting, one of operations management, et al.

No offense, but if half the people in this thread had ever taken one finance class, the discussion here would be completely different. The amount of ignorance so far is, well, understandable, I guess. It's a gaming fan site.

So you're educated enough to at least make the claim, but not explain why. You're going places....Lol