850°

Microsoft's Earnings Release FY14 Q4

Computing and Gaming Hardware revenue increased $3.2 billion or 49%, primarily due to higher revenue from the Xbox Platform and Surface. Xbox Platform revenue increased $1.7 billion or 34%, due mainly to sales of Xbox One, which was released in November 2013, offset in part by a decrease in sales of Xbox 360. We sold 11.7 million Xbox consoles during fiscal year 2014 compared with 9.8 million Xbox consoles during fiscal year 2013. Surface revenue increased $1.3 billion or 157%, due mainly to a higher number of devices and accessories sold.

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microsoft.com
MightyNoX3539d ago

It's almost like I, and so many others, have been saying this for ages.

Hopefully it'll be a wake up call to some deluded people around here.

iamnsuperman3539d ago (Edited 3539d ago )

Launching a console does come with a lot of baggage (in particular cost) so the difference isn't unusal (expect maybe the size). What this does unofficially confirm is Microsoft really won't go with a price cut this early.

BiggerBoss3539d ago (Edited 3539d ago )

Yeah I agree that it's expected to lose money during the launch of new hardware, but dang. That much money could last me over 100 lifetimes.-.

Didn't Sony make profit off Playstation last fiscal year? Correct me if I'm wrong

@devwan. Ahhh that's right. Thanks+

Wizard_King3539d ago Show
devwan3539d ago

@superman The majority of those costs is r&d. xbox one r&d costs are included in fy 13-14 results? Are you sure?

@BiggerBoss Last quarter, not last year.

amiga-man3539d ago (Edited 3539d ago )

Hardly the sort of news investors will want to hear, there has been plenty of talk of people wanting MS to sell their xbox division, although I don't think that will happen it only adds more pressure on the xbox.

Why o why3539d ago (Edited 3539d ago )

. . .but Sony . . . . .

Ok . . . Nobody has said it yet but I'm well surprised Sony haven't come up yet.

I like the point iamnsuperman made below about ms not acquiring deep pockets by making huge losses. It's true. .

Personally I hope they stay in the game and believe they will. Not all competition is good but anyone who thinks ms didn't wake Sony up is a little naive. Sometimes bad competition can be good too.

pinkcrocodile753539d ago

I'm not in the least bit surprised by the loss at this point in the Xbox One cycles, I'd expect a similar story from both Sony and Ninitendo too

Can we have a copy of the financial reports from both Sony AND Nintendo for a little comparrison.

I'd like to see how the same period on the Wii U and PS4 cycle affected finances, NOT SALES mind, just the company yearly finance report.

kneon3539d ago

@Why o why

It wouldn't change things much if they sold off xbox, it would just change hands, it wouldn't go away. Companies like Google, apple and amazon are looking to get into this market.

ZodTheRipper3539d ago

Microsoft simply sucks at making hardware, no wonder they are focusing on the cloud so much. I completely agree with Wizard_King, I'd rather see another company take Microsoft's spot in the console sector.

UltraNova3539d ago

@ Above

Who Activision? EA? Amazon wont bite, Apple is out of the question...who could buy the Xbox division and be less 'evil' than MS? Tough question I know...

OT: 400 million is a drop in the ocean for MS, literally. Yes the shareholders don't like this but selling their gaming division is admitting defeat to Sony and we all know how much winning means to our American friends...

This loss is probably attributed to the R&D for Kinect 2 as the actual console is selling ok (when compared to the 360 in a similar time frame).

Xbox is going nowhere and we should all be grateful for this. Imagine letting Sony and Nintendo run wild! No thanks!

Double Toasted3539d ago (Edited 3539d ago )

Lol I believe MS will be fine. I can't say the same for their competition though.

sonarus3539d ago (Edited 3539d ago )

This news is almost irrelevant to gamers however, it his HIGHLY relevant to microsoft investors. The fact that the Xbox division has only accounted for about 1.5 % of Microsofts gross profit 2014 fiscal yr just shows how irrelevant xbox division is to Microsoft's bottom line. This is why investors want the xbox division sold, spinoff or shut down. Xbox division simply isn't part of Microsofts core competencies and knowing this off course investors will be pissed if its accounting for such substantial losses.

However, new ceo has said microsoft will keep xbox because of its potential as a home entertainment device.

GTgamer3539d ago

To all people saying ohhhh this nothing to MS they can brush it off while being true No company likes losing Money it doesn't matter how much they have so stop being naive, you think MS wouldn't drop the xboxOne like a five Dollar hoe if it keeps losing money in the next few years ಠ_ಠ.

mixolydian_id3539d ago

It's still a small drop in the ocean for a multibillion dollar corporate business.

That cost was probably incurred by the considerable amount of changes that had to be introduced following E3 (2013).

They had already planned to blow a load of money on Console development. If they had released a year later, that money would've still been invested into console development.

I imagine a lot of the team ran up some serious overtime payment this past year to boot.

Not a loss, it's nice to know my future console has been thoroughly invested in.

guitarded773539d ago

@UltraNova

Just for the sake of conversation, Google could, and would be less evil. I know they never would, but they could, and they're pretty open to devs and innovation.

Also, a private investment group could. It happens from time to time. Private investors buy a company and turn it around... but typically they run it into the ground. A positive example is Fender Guitars. They were run to crap in the 80's, but then a group of their workers bought the company and brought the standards up to the highest in the companies history (arguably) along with the greatest profits. They in turn bought many other guitar companies... some of which they shuttered, which was bad :/

Samsara823539d ago

In answer to BiggerBoss ...I might be wrong but the last numbers given by sony were not for the year but were trimestrial so their developments costs were not included...I think they were included in their previous trimestrial report...Will have to wait for a whole year report from them to really compare anything

xer03539d ago

@BiggerBoss

Yes - Sony in comparison made a profit.

UltraNova3539d ago (Edited 3539d ago )

@guitarded77

Although I get why you used the Fender Guitars example an interested investment group would take into account the negativity the xbox brand carries with it at the moment and should probably consider their own inevitable scrutiny that they will get subjected to from the media and gamers alike in search of similar 'evil' characteristics to Microsoft.

What I'm saying for the lack of better English is that who ever wants to buy the xbox brand must have a pretty clean floor under that carpet of theirs if they want to 'revive' the brand and profit from it.

We gamers are a stubborn bunch we don't forget and we hardly forgive!

darthv723539d ago

@ultra... "We gamers are a stubborn bunch we don't forget and we hardly forgive!"

That seems to be more of a newer generational sentiment. At least from an older perspective, those of us who have been around much longer when gaming was first starting to develop, dont follow that sort of thinking.

The way you describe it is more along the lines of the entitled way of thinking. the "i'll be damned" crowd which has been getting worse and worse over the course of the last few generations.

gaffyh3539d ago

Wow, that's a lot, however I'm sure they expected some of this. I think it's worse because they haven't sold as much as they thought they would.

UnHoly_One3539d ago

@Wizard King

MS has been a cancer on gaming for 15 years?

Basically every feature you enjoy on your Playstation console is a direct response to MS doing it first.

Not saying that NONE of it would have happened without them, but some of it sure wouldn't have.

Do you think you'd have PS+ without MS? Would online gaming even be anything like what it is now without MS pushing it?

gaffyh3539d ago

@UnHoly_One - Not saying that MS is a cancer as I'm sure they sped up development particularly on the network side of things, but they weren't the first to do it at all. The Dreamcast already had an online infrastructure way before Xbox even existed, and even the PS2 had network support with games like SOCOM.

The only innovation that MS introduced to consoles was the ability to play games online with matchmaking, and HDDs on the box. And I am 100% certain that these features would eventually have been implemented on Playstation without MS being a competitor, but that the competition, sped up Sony's response.

I'd argue that MS actually copied Sony a lot more, almost their entire console strategy was copied off Sony's PS1 launch. And without Sony launching into the market, MS would never have even tried.

Magnes3539d ago

@wizard_king nice anti American sentiment and people call us bad I'm not a MS supporter but people like you make me reconsider. Man did I love my Dreamcast though.

Visiblemarc3539d ago

@UltraNova

400 million dollars is an enormous sum of money for *any* company.

There is a persistant myth in forums that large companies with deep pockets scoff at gigantic losses.

Not remotely true.

Companies get big by being good with money (and most being publicly traded have shareholders to answer to). Losing massive sums of it, is the road to failure and it almost always leads to huge policy shifts, staff changes and re-evaluations of strategies.

I recall a few years back people were talking about RIM's (Blackberry) warchest. Many thought those massive stores of cash made them invulnerable. In fact, it was no defense at all to an incredibly poor strategy.

I'm not directly comparing MS to RIM though (for countless reasons), in fact the massive Surface losses of recent times have probably made them even more sensitive. I expect increased caution.

thehitman3539d ago

Kinect was a 400 million dollar disaster is whats that saying.

rainslacker3538d ago

@darth

I have to disagree. At least partially. I do feel that the "Never forgive, never forget" mentality is a bit much, but gamers of all generations seem to be able to apply what happened with what could possibly happen and how it will affect them over the long term. I believe MS initial policies showed this to a great degree, as people not only were upset about the immediate result, but what it could mean if it were successful.

For my part, I have no reason to have to forgive MS. They were honest about it at least, and I never actually purchased anything to be upset about. I didn't approve, and I voiced my opinion, and didn't bother to pre-order the system. But from all this, I didn't forget either. What they did put a bad taste in my mouth for the future of gaming, and how I consume my gaming content. Having watched MS for well over 30 years, even before I really understood how seedy they are, none of it really surprises me in retrospect. It also means I have less faith in them to do the right thing in the future, because again, I don't forget.

They can certainly turn things around. But taking Sony's missteps last gen, which were nowhere near as bad, it took them several years before they started to be back in gamers good graces. I expect MS will be in a similar situation. If they do everything right this gen, they may not win this gen, but they may have a better chance of becoming "The winner" next gen.

Bigpappy3538d ago Show
Death3538d ago (Edited 3538d ago )

According to the Earnings Release, Microsoft made 893 million in gross margin on sales of 9.6 billion in 2014. This in contrast to 956 million gross margin on sales of 6.4 billion the year before. The Xbox didn't lose money, the division which includes Surface made 63 million less than the year before.

HanzoHattori3538d ago

Playstation didn't make money last year because of the purchase of the Gaikai streaming service, which is now called Playstation Now.

+ Show (25) more repliesLast reply 3538d ago
lelo3539d ago ShowReplies(12)
TheWackyMan3539d ago

What do you mean exactly? While 400 million dollars is a lot, it's Microsoft. I'm pretty sure they can handle a few losses. If it keeps happening, you should be a bit worried of course, but they are MUCH MUCH better off financially than Sony by a long shot.

Wizard_King3539d ago

MS has been bleeding large amounts of money for over a decade now, nothing and I mean NOTHING has been going right for them in the business world. Windows 8 is a flop, the surface tablets and Windows phones are loosing money in every market and the console division hasn't been in the black now for about 3 years. Not to mention that the games that MS had pinned on selling large amounts of consoles never eventuated to anything real.

Things are not looking good for MS and I see them doing a large amount of trimming the fat in the near future. Even Amazon confirmed a while back that they where not interested in buying MS's console division. I mean who buys something that lost the owner 400 million bucks last fiscal year, oh right NO ONE.

Dreamcast 2.0 before 2015 mark the page.

devwan3539d ago (Edited 3539d ago )

Xbox 360 hardware is profitable. Xbox Live Gold earns lots of money. Royalties on software sales generates plenty of income.

Now offset all those and end up in the red by $400m.

That's one hell of a large hole brought about by xbox one.

"They can handle a few losses" is such an ignorant cop-out.

marlinfan103539d ago (Edited 3539d ago )

@wizard

its obviously not good seeing a loss like this but where have you seen MS bleeding over the last decade? they continue to post profits year after year

marlinfan103539d ago

for the people disagreeing with my other comment

http://money.cnn.com/2013/1...

SniperControl3539d ago

@marlinfan10

Wizard is right.

They wrote off $900 mill a year ago because surface bombed bigtime, in fact it still is, current figure is around $1.2 bill.
Zune lost them half a billion a few years ago, Windows 8 has flopped big style, there Win phone division is struggling against giants Google and Apple.
The only division making true profit is there Office products.

FITgamer3539d ago

I love these types of comments. It's like people think Microsoft doesn't mind losing money.

SonyMontana3539d ago

MS is surviving on money from their glory days. Virtually every product they have on the market is a failure (Bing, Smartphones, tablets, the now dead Zune, Windows 8). They need a big hit in order to make a come back but the problem is they are out of touch with what people want these days. The launch of the Xbone serves as a shining example of just how out of touch MS is these days.

Kribwalker3539d ago Show
TheWackyMan3539d ago

@Kribwalker You're a god among men. Thank you.

n4rc3539d ago Show
Dehnus3539d ago

@Wizard_King
And there you go again with deciding what I should like. You probably never worked with a surface or a WIndows phone and can already decide for me. Than this Dreamcast 2 crap like it is a bad thing!

NEWSFLASH SONY FAN! It is one of the best liked consoles of all time with some of the most original games ever produced! Yes the Dreamcast is still loved by many, including having one of the most active homebrew scenes available.

What you call Evil I can also say for Sony. That said I do not want an Xbox one either, but stop dragging everything non Sony through the mudd just because it isn't your favourite choice.

marlinfan103539d ago (Edited 3539d ago )

yeah they've had a few failed products but that doesn't change the fact that they post profits quarter after quarter. every company has had bad products that end up costing money, thats why they don't put all their eggs in one basket. name any big company like MS that hasnt had products that cost them huge amounts of money. id bet you'd be hard to find one. saying they're a bleeding company with nothing going right is just silly when you look at their yearly profits. obviously somethings working.

Evilsnuggle3539d ago (Edited 3539d ago )

dev..wan@

360 didn 't make any money in fact 360 lost money . That is why the ex-CEO Nokia wanted to sale the X box brand. In fact X box has lost billions Microsoft would sell the X box brand if they could. Don't be surprised if Microsoft spins off the X box brand. If Microsoft spins of the X box brand then X box brand wouldn't have deep pockets like X box brand has now with huge advertisement and money hating games. I think it would do more harm than good . But it's the best way for Microsoft to make the best decision regarding X1.

Any way you cut it doesn't look good for X box brand. I don't think Microsoft will make another console. I really think Microsoft will make a set top that is a cloud services.

http://www.neowin.net/news/...

user3672723538d ago (Edited 3538d ago )

Bottom line is MS continue to make money even with a predicted loss on the console side as expected during the launch year. Can't say that about the competitors though. Imagine the tone in this thread if another company that is beloved here all of a sudden have a record quarter even with losses in launching a new hardware. MS will be fine and Halo 5 will still be released next year. That id what matters to us gamers.

+ Show (12) more repliesLast reply 3538d ago
Gazondaily3539d ago (Edited 3539d ago )

Doesn't launching a console always have high costs associated anyway? Whether or not this loss is 'reasonable' is another question entirely, but some of the other 'deluded' lot may jump to conclusions as they get over-excited and giddy over the news.

Anyway, as the chap above me has quite rightly said, MS can take this hit (natural or not). Others in the game may not be in a position to swallow these kind of losses (if they do suffer from them at all).

iamnsuperman3539d ago (Edited 3539d ago )

It depends how many losses they are willing to take. Microsoft has deep pockets but those deep pockets didn't materalise from huge losses. The problem for Microsoft isn't the Xbox brand. It's the electronically products as a whole. It has been estimated that Microsoft has lost a combined loss of 1.7 billion on the surface endeavour. That is a big loss. If Microsoft don't pull this around next year's those little discussions about how Microsoft should not be a manufacter might get louder.

That is the biggest threat to the Xbox. They may end up being lumped into a problem the Xbox could easily get out of.

@below If the Xbox brand doesn't bring return or small, insignificant, gains, it definitely will. The problem for the Xbox is Microsoft's other electronic endeavours are doing so poorly they may just scrap the whole thing entirely. The Xbox is a surprisingly small part of Microsoft of which sits low on the priority list

Gazondaily3539d ago

Yeah that's a good point. I don't see the Xbox getting lumped into the whole electronics product anyway because the attachment and goodwill associated with the Xbox brand is tremendous (especially compared to failures such as Surface etc).

If however, the Xbox division continues to see losses over the course of this year and next year, then yeah, that's when alarm bells should be ringing at MS HQ.

Menkyo3539d ago

@septic "good will" are you kidding ? What good will right now their the step child of gaming.

Gazondaily3539d ago

"@septic "good will" are you kidding ? What good will right now their the step child of gaming."

Are you seriously telling me that the Xbox brand has no appreciable goodwill vested in it??

Spotie3539d ago

@Septic: Within the gaming industry? Not really. A couple of fans, like yourself, have forgiven them. But most gamers have not, I think.

Seriously, look at how they manage to piss off everybody but the most devout fanboys. Sure, they may have changed things now, but people's memories don't just vanish.

Gazondaily3539d ago

@Spotie

I'm talking about Goodwill in terms of the Xbox brand as an asset. Not just about consumer perception (of which admittedly it forms one part of it).

"Within the gaming industry? Not really."

Obviously its within the gaming industry.

brew3539d ago

Yes , and they have more launches yet to come !

mixolydian_id3539d ago

It's an expensive business. At least they haven't been sued yet!

To be fair, they would've blown a lot of that anyway... even if the console was released a year later.

There would've been some costs incurred from introducing the 180's so eagerly voiced by the brats.

I still would've preferred the old vision for the Xbox.

If thats just the annual spenditure number, I'm glad to see they've put so much money into the device. Actually makes it a more valuable commodity. Probably explains they're thirst for updates and new feature sets.

the 3 x operating system must've been a entirely new build. The first of it's kind ever. They pretty much wrote the book on it... I wonder how long it'll be until we start seeing multiple operating system devices pop up all over the place?

BABY-JEDI3539d ago

MS have good will as they are now listening to the gaming community & they are now acting upon them.
I would say this is good will (regardless of all the mistakes)

Revolver_X_3539d ago

"at least they haven't been sued yet!"

Google is your friend kid.

http://www.escapistmagazine...

Theres always some knitwit tryna make a buck off of strawman claims.

MysticStrummer3539d ago

"At least they haven't been sued yet!"

Wow. Such delusion.

rainslacker3538d ago

400 million isn't a whole lot when you take into account R&D, but I don't know if this figure includes that cost, as it was likely written off the year prior.

This particular figure is also from all their devices division, but I wouldn't doubt a lot of it is for marketing and R&D and distribution of the X1.

It's not the end of the world for the X1 by a long shot though. We're talking about a product that has a 5-7 year shelf life, and if they can make that money back in that time, or better yet profit, then investors will be happy-ish. If this is mostly X1 R&D, then going forward, it means they wouldn't post losses like that, as the costs have already been written off.

+ Show (9) more repliesLast reply 3538d ago
die_fiend3539d ago

That's a lot of money to be losing on a console that is a categorical failure in every regard.

Maybe they should sell off this division after all

Gazondaily3538d ago

Oh how you and your fellow 'gamers' would love to that.

Letthewookiewin3539d ago

This in contrast to the PS4 already being profitable for Sony and selling almost double. This isnt good for Msoft and the X1.

Fanci3538d ago

Xbox One is selling better than the 360. Microsoft did well with the 360. So things are most certainly looking good for both companies, and not bad for Microsoft.

Magicite3539d ago Show
MultiConsoleGamer3539d ago (Edited 3539d ago )

EDIT: Sorry not taking the bait.

Author better check your math. It would really hurt your rep, possibly ruin it, when someone calls you out on your numbers. :)

Kidmyst3539d ago

If this is true, shareholders won't be happy and pressure might come to Xbox to make drastic changes or sell off the brand. This might explain all the leadership changes MSFT made earlier.

Anon19743538d ago (Edited 3538d ago )

You hit it right on the head here. Microsoft is a business and it's their job to run the company in a way that maximizes shareholder returns.

The Entertainment and Devices division, even when making money, pales in comparison to MS's other division when it comes to return on the money invested. To break it down simply (and this is just illustrative), if you invest ten million dollars each year into six different divisions, and five of those divisions return you 20% on the money invested, and one division continually brings in only 5% for a decade, at some point investors are going to revolt and demand to know why those investments aren't being put into more lucrative areas of the company. That's what we've been seeing from some of Microsoft's biggest investors and board members alike.

Launches are supposed to be expensive, but most of the expense is taken up with initial R&D and launch marketing. Those expenses were accounted for two quarters ago. These loses should be concerning to gamers as Microsoft is clearly in a period of transition, despite the lip service being paid to the Xbox brand. Microsoft PR seemed just as committed to the Zune back in the day as well. And we really don't even know how bad it's been historically as Xbox losses have always been masked by patent royalties in the past. To anyone paying attention, the XBox has never been more vulnerable.

system223539d ago (Edited 3539d ago )

ummm...

i agree that the xbox could be doing better in terms of sales but.... your comment is kind of naive. consoles are expensive not only to launch, but also to develop. look how much money it cost to develop the controller alone. also - margins on console margins are razor thin, if not losing money. it is expected that consoles make a lions share of the money through software and well... there just isn't a lot of great software right now.

granted this number is pretty crazy but i'm pretty confident a lot of it is not the result of poor sales, though more sales certainly wouldn't hurt.

the ps4's success is partially because of timing, partially because its a kick ass system but also partially because of luck. it had the perfect storm brewing for launch success.. people pissed at MS, pissed at xb1 policies and even more, some flubbed multiplat launch titles on xb1, people pissed about price with mandatory bundled kinect etc... had ms actually not made a slew of mistakes on their handling of the xb1 launch and promotion things would be tighter. at the end of the day the systems really are pretty close. xb1 just has a bad rep now.

iceman063539d ago

I'm sorry, but it is not luck when your competitor screws the pooch. Sony was just much wiser and less arrogant this time around. They didn't rest on their name and came out first. They created a machine with input from developers in the industry (listened BEFORE the launch). They even got in front on the reveal. None of this was luck. It was calculated and it seems to be working. On the other hand, MS was arrogant in its approach. It created a system that was hard to create a value proposition for in comparison to the competition. Even MS couldn't decide how to market their "All-in-one", "Always connected", "Only with Kinect" future. To compound that, they added in a dose of horrible PR blunders. Once again, this isn't tied to luck. It's directly tied to preparation and calculation.
That being said, these losses ARE probably tied to R&D, marketing, and licensing more than they are actual sales (unless MS severely over projected their sales). This is by NO MEANS the death knell that people imagine for MS. But, it can't make shareholders very happy because they want to squeeze every dollar they can out of the business. That's THEIR bottom line that MS is messing with.

chrismichaels043539d ago

I agree MightyNoX. A certain part of the gaming community loves to brag about Microsofts profits charts...but they ignore the fact that the majority of those profits come from Microsofts other non-gaming divisions.

gangsta_red3539d ago ShowReplies(1)
lawgone3539d ago Show
GiantEnemyCrab3539d ago

It's a console launch. You expend a huge amount of money. Gotta spend money to make money.

Orbertron3539d ago (Edited 3539d ago )

Money makes the world go round

3539d ago
Stoppokingme3539d ago ShowReplies(2)
RIP_Cell3539d ago

they didn't lose 400 million, they make 400 million less profit than last year, big difference

kenshiro1003538d ago

Did I read that right? 400 million?! Wow...

RIP_Cell3538d ago

wow? do you know how much Sony is on track to lose this fiscal year? 1 billion

kenshiro1003538d ago (Edited 3538d ago )

Is that for the gaming division? Because the last time I heard about it, they were profitable. In fact, Sony is recovering from their losses.

By the way, stop dragging Sony into this. This is about Microsoft.

otherZinc3538d ago (Edited 3538d ago )

It's amazing how many of you don't know a thing about business or how to read a financial report.

The XBOX ONE "is" profitable. It's been profitable from day 1.

The PS4 wasn't, maybe they should sell its games division. PS4 only became profitable "after" it laid off 100 ' of workers in each & every development house they own: Including, Guerilla Games, Naughty Dog, & Sony Santa Monica. Then they only made $12 per PS4 Sold, and that wasn't enough to remove Sony Stock from "Junk Status" by Moodys and Standard & Poors.

Some of you on this site are just silly.

Death3538d ago

It's incredible how no one is checking the link. The division made almost 1 billion in gross margin yet everyone here is saying they lost money. The cost of revenue increased which is why gross margin this year based on 3.2 billion more in revenue decreased by 63 million.

Revenue was up 49%, but the margin decreased 7%.

chaosx3538d ago (Edited 3538d ago )

https://www.worldpayzinc.co...

check this out , Doesn't look as if they should be too worried.

+ Show (20) more repliesLast reply 3538d ago
iamnsuperman3539d ago

That is an insane loss to be solely attributed to the Xbox platform. I doubt we are going to see a price cut anytime soon.

Tony-A3539d ago (Edited 3539d ago )

Agreed. It sounds counter-intuitive but keeping the price to at least $400 is really the only option they have right now and cutting price might only cause more damage.

I chalk it up to The Curse of the Third Console. Good or great debut, much more successful second coming and arrogance/pride destroys the third.

On one note, I would advise Microsoft to re-evaluate their goals and long term endeavors. They tend to always be that 12 year old kid that wants what the other kid worked hard for. Their software is a success because it was a user-friendly way of doing something that was already possible. But in today's generation, every market they've squeezed themselves into has come off as a "me too" approach. Phones, search engines, consoles, video game publishing, they all feel like a result of them seeing others making good money from it. Only difference is they don't really care if they do it better than others as long as they get a piece.

mmmmmmmmmbut I'm not a financial advisor...

Insomnia_843539d ago ShowReplies(3)
imt5583539d ago (Edited 3539d ago )

Around 100$ loss on each Xbone sold.

Well, don't expect pricecut anytime soon.

@Fishy

Quote :

"...Probably the same scenario with the 360 or any other company's launch of a major new product..."

Well, this gen Sony doing quite opposite.

@InTheLab

Quote :

"...Maybe I missed it but where does it say they lose $100 on each sold?..."

It is just pure calculation. 400 mil. loss and around 4.9 mil. Xbone sold ( i presume ). Well, maybe my calculation is wrong.

@Fishy :

Quote :

"...If they make a profit on the PS4 alone in its first fiscal year that's one for the books and they must of had a minuscule R&D overhead. Which seems unlikely..."

http://www.dualshockers.com...

http://www.eurogamer.net/ar...

InTheLab3539d ago

Maybe I missed it but where does it say they lose $100 on each sold?

Fishy Fingers3539d ago (Edited 3539d ago )

Well that good news for Sony then.

While I don't follow this as accurately as some I don't believe Sony posted outgoing revenue associated with individual products like is being done here.

If they make a profit on the PS4 alone in its first fiscal year that's one for the books and they must of had a minuscule R&D overhead. Which seems unlikely.

Fishy Fingers3539d ago (Edited 3539d ago )

Obviously a headline to grab attention. While revenue from the Xbox brand actually increased the outgoings did too. Like the article points out, your first fiscal year encompasses the additional R&D costs and marketing associated with launching a new product. Probably the same scenario with the 360 or any other company's launch of a major new product.

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280°

Xbox's Preservation Step Sets A Much-Needed Example, Especially For Nintendo

Hanzla from eXputer inquires: "If Xbox can care about preserving its games and legacy, what exactly is wrong with Nintendo, trying to kill game preservation single-handedly?"

purple1012d ago

Ahh yes the good old game preservation of saving all your games to a removable hhd on the Xbox 360, taking it round your mates house, setting up multiple tvs to
Be met with “save data corrupted, please re download”

Or how about removing 360 games
From the store
, download them now or else, and, better hope to god that save data doesn’t corrupt, or it’s lost for ever

Nice one ☝️

Zeref2d ago

It's better than what Nintendo and Playstation is doing. It might not be perfect but at least they are TRYING. Unlike the others.

DarXyde2d ago

Trying? Take off the blinders for a moment, mate.

1. A failure to preserve games is just that: a failure to preserve games. Don't try to sugarcoat it: NO ONE is doing it properly. Better than awful is nothing to write home about.

2. At the time of this comment, isn't it the case that you need an internet connection to play Xbox games even if you buy physical discs that are hardly in circulation anymore? I don't have a Series X and I can't verify, but I think that is correct. I'm fairly certain you can at least play PS5 games at version 1.0 (not much of a win really when many games require day one patches). I think Microsoft's all digital, licensing approach is by far more aggressive than anyone else's. They really try to push you to game pass where you lose your entire library by umm.... Skipping a month of payments.

I don't think anyone is doing it right whatsoever. Don't get me started on Nintendo, who goes after anyone looking to preserve their games better than they ever would with extreme litigation.

Don't be a simp for any of these companies. Get it together.

PhillyDonJawn2d ago (Edited 2d ago )

@DarX never speak on Xbox again. You lost all credibility with your internet connection comment. Smh you have 0 clue and misinformed yet speaking on something you don't no squat about.

Einhander19722d ago

What has Sony done exactly? You guys keep deflecting to Sony but I am not actually seeing any results, and ai am certain nothing that you can come up with even comes close to what Microsoft has done and what they have tried and failed to do, like tie all your disks to your account on xbone.

Microsoft removed their whole indie section when they moved to the xbone because they were going to only allow games on the service that came from a publisher, id@xbox started after xbone launched and it only exists because Sony embraced indie and Microsoft was forced to cancel their plans and reverse course.

And every single game that was part of games for windows live including disk games (I have gta 4 on disk that won't work) so hundreds of games that use that DRM no longer work unless the company themselves patched it out which of course very few did.

MrBaskerville2d ago

Not trying. Tried. they killed of the backcomp program years ago. They set something up again, but sounds like it's more of an attempt to save the current library on whatever they are planning next. With luck they save everything and more, but let's see. I could see them killing off parts of the OG xbox and 360 libraries. Can't imagine that they would allow us to play Forza 5-7 in the future.

With that said, I do like what they've done and really wish they could have done more.

shinoff21831d 17h ago

Zeref

So killing off physical media is trying what exactly. Ms don't really give a fk if you think they do your kidding yourself.

Profchaos1d 16h ago

They are not trying this team is established for forward compatability the team is. It interested in preserving Xbox or 360 games.

+ Show (3) more repliesLast reply 1d 16h ago
isarai2d ago

Is that why Hellblade 2 is digital only?

Zeref2d ago

Just because it's digital only doesn't mean you can't preserve it. Just put it on an external and you have the exact same functionality of what a disc does.

MrNinosan2d ago

Guess you're trolling, but if you actually think that's how it works, I'd recommend buying some braincells.

mkis0071d 8h ago (Edited 1d 8h ago )

Volitile vs nonvolitile data. A disc will not corrupt either. A drive can be corrupted.

Einhander19722d ago

This is just a scammy PR move to distract from the fact they are going digital only and trying to push streaming and subscriptions only.

No gaming company has pushed harder to remove ownership than Microsoft.

Without discs there is no preservation, preservation can't be done by the rights holders it can only be done by the consumers, anything else is a lie.

2d ago Replies(3)
Einhander19722d ago

Anyone remember xblig which Microsoft removed their whole 360 indie section removing hundreds of games from people?

2d ago
2d ago
Zeref2d ago

Do you know you can put your games on an external and preserve them that way? There are no benefits to discs. ZERO. Idk why some of you are still obsessed with them.

DarXyde2d ago

Because games like Persona 5 exist. It's STILL V1.00. On Playstation, that's a win because 1.00 is installed on the disc—no need to download anything.

If a game does not require any updates, it's all on the disc.

Extremely low bar in the modern era, of course. It's not much of a win by any stretch.

But for now, physical media does have a purpose, at least on Playstation.

Einhander19722d ago

That is factually not how game licensing works, try plugging your hard drive into someone else xbox, It's not going to work, and it won't work if the licensing servers ever go down.

Einhander19722d ago

Anyone remember games for windows live.

I have around a dozen games, some on Steam itself that will not work because Microsoft shut off the licensing servers.

BehindTheRows2d ago (Edited 2d ago )

I do. I STILL have games (Gears of War being the big one) I cannot access because Games for Windows LIVE is total garbage and no one has held Microsoft accountable.

Zeref2d ago (Edited 2d ago )

You don't have an Xbox apparently. Because you can 100 percent plug in your external and play games from it on any Xbox console lol. You just have to be logged in to prove ownership.

Chevalier1d 23h ago

"You don't have an Xbox apparently. Because you can 100 percent plug in your external and play games from it on any Xbox console lol. You just have to be logged in to prove ownership."

Damn how many times do people got to explain your idiocy to you? You can take a copy of Persona 5 like someone used as an example and play that game on ANY console WITHOUT logging in which means I can lend the game to a friend without internet and they can play my game. Can you lend your hard drive to anyone without logging in for them to play? NOPE. That is a huge difference and if you think otherwise then sorry you're an idiot.

Tacoboto2d ago

"No gaming company has pushed harder to remove ownership than Microsoft."

Ubisoft is literally erasing games people bought from their libraries... My PS1-3 discs are useless on modern hardware. Nintendo's re-published and resold almost their entire Wii U library, and the eShop is completely dead with no BC mechanism in the Switch software. Microsoft publishes everything they make today day one on Steam and Xbox/Windows. Sony only brings to PC the titles they think you might want some years later and Nintendo won't even design a functional long-lasting joystick.

You're absolutely trolling and not serious if you think Microsoft today is the worst offender.

shinoff21831d 17h ago

Yay steam

Not everyone fks with computers though. The disc is still the best way as a console player. Period.

Tacoboto1d 14h ago

How do Sony and Nintendo feel about these discs from 2001-2013?

Don't be stupid, you know Xbox is the best at this today.

+ Show (3) more repliesLast reply 1d 14h ago
Hofstaderman2d ago

Nobody wants this. Sales or the lack of it in the case of XBOX is very telling. I wonder how the adorably all digital series X will fare. Adorably dismal perhaps?

crazyCoconuts2d ago

Only time will tell, but for from someone like me suspecting that Xbox is trying to gracefully exit the console market, that "forward compatibility" team is trying to get Xbox games playing on Windows PCs. I mean, it's nice that they're not planning on exiting with a "enjoy your games while the hardware still works" message, so that's nice. They still have a brand to protect via Microsoft so probably feel obligated to have a better exit strategy.

Xeofate1d 22h ago (Edited 1d 22h ago )

That is not their plan, their plan is to transfer users accounts to the cloud.

Phil Spencer himself said as much a few months back, plans could have changed but I think people are reading way too much into one statement where Phil said he would allow Epic on xbox because he wants to be able to sell xbox games directly on other platforms. Aka, instead of selling Sea of Thives through PSN he wants to have an xbox store to sell his games on PlayStation without giving PlayStation any money.

Again, it's extremely unlikely that Phil plans to put PC on xbox and licensing would prevent them from just giving out other publishers games purchased on xbox copies of thier games on PC, Microsoft does not own their games.

crazyCoconuts1d 3h ago

The thing that doesn't align with the cloud strategy is the giving up on exclusives. You'd still need strong exclusives for cloud streaming - it's still a "platform" , just with a lower upfront hardware investment. I feel like they've learned what PS learned with PSNow long ago. We're not ready to stream games and it's only gonna lose them money to try at this point

FinalFantasyFanatic1d 11h ago

I would love that, I'd buy up some of the Xbox games if they could run on PC, like the Rare Replay, Lost Odyssey and Dead or Alive Ultimate, probably a pipe dream though.

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370°

Could Xbox Soon Become The Next Dreamcast?

Microsoft's future in the video game space is murky right now, so let's break it all down.

Read Full Story >>
thegamer.com
ApocalypseShadow14d ago (Edited 14d ago )

Not anytime soon. But they're on that path.

One thing not mentioned in the article is Microsoft's money bags. If Sega had Microsoft's money, they would have still been around as a hardware manufacturer. Xbox as a platform only survives because of the money bags. They can continue making consoles for the core and port to PC.

The multiplatform strategy is only the result of arrogance and misguided leadership that blew up in their face. They thought gamers would jump on Xbox in droves if they knew that many of their favorite games would be only on Xbox. But that's not happening at all. Sales didn't increase. They decreased. Why? Because the dumb asses thought giving away these expensively made games in a cheap service would also turn the tide.

Gamers on other platforms are willing to buy quality. They don't need to be handed nearly free games in a service that aren't even finished and sometimes average in their development. Gamers buy Nintendo games. They buy Sony games. Microsoft groomed their base to not buy games. Even the quality ones. It has always been their plan to go digital. But most gamers still like single player gaming. Still like physical releases.

Microsoft's problem has always been that they don't produce high quality games at the same output as Nintendo and Sony. Actually, they should be producing quite a lot more because they're worth over 2 TRILLION. How they don't have more is ridiculous and no excuse. Buying publishers to take away from competition only backfired. Because it still takes millions of dollars to continue to make those games from the publishers they snatched. Their only choice was to crawl back to their competitors to help sustain those developers because Nintendo and Sony platforms were the ones buying games.

Am I sorry for Microsoft? Hell no! They deserved last place for putting in the least effort. They deserved the fallout for buying up the industry and didn't make a single blip on the radar against their competitors where they now need those same gamers they took away games from to support them. Part of it may have been to cash in on their competition. But the result is the slow death of their platform. They may go 3rd party. They may keep making hardware. I don't give a shit about them to worry about it. I only give a shit about the destructive nature of their industry moves that only negatively affect gamers. They could sell and drop out of the industry and I wouldn't blink. Probably laugh. But not blink. They deserve whatever comes to them. At least Sega put in the effort when it came to games. They just had poor leadership. Microsoft has poor leadership and barely makes memorable games. That's a killer combination. And not in a good way.

Cacabunga14d ago

That would be an insult to Dreamcast.. it had a crazy line up of legendary critically acclaimed games.

Crows9014d ago

I was thinking the same. Dreamcast had incredible games in such a short amount of time. It was truly exceptional.

darthv7214d ago

...and yet all those great games were not enough to sway people from the looming release of the PS2 at the time. Sony just has that kind of brand loyalty.

Cacabunga13d ago

Darth

I do not agree.. Sony had even better games thanks to an unprecedented 3rd party support..
DC had amazing lineup but 90% were arcade games..

88313d ago

@darth:
And Sony showed off "The Emotion Engine" and their real time demos that made everyone think they would miss out on REAL next gen 128bit magic if they jumped in before PS2s polygon pushing monster (and early lack of anti-aliasing with a healthy heap of shimmer + DVD playback) stepped up. PS2 was a fantastic system though with amazing games.

+ Show (1) more replyLast reply 13d ago
blacktiger14d ago

That's not true. Just because Microsoft has the money doesn't mean Microsoft can allow xbox to bleed entire Microsoft money. It doesn't work like they. Also SEC will be watching and investor won't allow it. Lot of reasons why Microsoft can not continue even if they wanted to. SEC regulations is expensive.

fr0sty14d ago (Edited 14d ago )

Exactly this... Microsoft is a publicly traded company, mostly owned by their shareholders (Approximately 59.24% of the company's stock is owned by Institutional Investors, 7.73% is owned by Insiders and 33.03% is owned by Public Companies and Individual Investors.). Their shareholders call the shots on the business decisions, and their shareholders want one thing and one thing only, for their stock price to go up. Losses do not make stock prices go up... so if the division continually posts losses on hardware, but shows profits on software and services (which has been the case with Xbox its entire lifespan, for over 20 years now), the shareholders are going to grow impatient and demand they stop making hardware and focus on the only thing that has ever made them money, software and services.

When Microsoft bought Blizzard and Activision for almost 100 billion, I knew that was the nail in the coffin for Xbox as a console... as the shareholders were going to expect a quick return on that investment, and when it didn't materialize, they were going to be out for blood... out to force Xbox to sell those games on as many consoles as possible, "and while you're at it, sell those first party exclusives that aren't selling well on other consoles as well... hell, just stop making consoles and sell games."

If there is another Xbox console generation, it will definitely be the last, but I doubt there even will be one at this point. I think the Xbox division planning on it just in case, but I don't think the project has been greenlit from Microsoft itself. The rumors that they have not yet even secured the chips needed from the chip fabrication facilities ties into this.

shinoff218314d ago

While I usually agree with you . Alot of what was said can just also be asked before any of that.

How long will the shareholders wait? It doesn't appear long at all

Babadook713d ago

I think I get your point. Like just because MS has money does not mean they are content to throw it away on a dying ecosystem. Xbox has to be profitable or “what’s the point?”

ifinitygamer14d ago

Money bags, yes, but are we ignoring that Xbox actually makes a profit on games and GamePass? Hardware is often a loss leader, and they're probably making profit 4 years into the life cycle, but games and services revenue have been very profitable while other parts of Microsoft's business is struggling. Say what you will about the quality of those games, of course, but this is kind of a reverse Dreamcast situation, where the console was dragging down the company and put it at risk of shuttering entirely. Killing that console saved the business and allowed it to continue to make games on multiple platforms. In this case, the service is very profitable, as are the games, and they're also double-dipping into Multiplatform to extend this further, while their hardware is just sort of what they believe to be the best for gamers and their own titles (whether that is the case or not...)

fr0sty14d ago (Edited 14d ago )

The issue is, they aren't selling enough hardware to make their exclusives profitable, and now that they've bought half the gaming publisher/dev industry, they have no choice but to go third party to make a profit... and that is making their shareholders take a real close look at their hardware division under the microscope... why keep making the hardware if the software is all that is making them money, and they continually, generation after generation come in dead last with hardware sales?

Look at a game like Spiderman 2... if it had been an Xbox exclusive, with the amount it cost to develop, it would have been a huge failure... simply not enough consoles out there to sell it on. They would have been lucky to break even.

ifinitygamer13d ago

@fr0sty agreed completely, which is why they're hedging by releasing other games to multiplatform, plus they have PC to make up for the difference in a lot of ways, which is why their games are not complete money pits. It brings up the question of whether or not those exclusives would drive sales of consoles, though. Let's say Spiderman 2 was an Xbox exclusive, it would certainly have pushed console sales, though who's to say how much is anyone's guess.

fr0sty13d ago

That's why you can't rely on just one exclusive, Sony has always delivered on a wide range of solid exclusives, even this generation (even if they haven't been strong on the first party exclusives, they've made up for it with third party). They don't rely on just one "system seller", they have a portfolio of them.

13d ago
JBlaze22613d ago

ApocalypseShadow To be honest Sony has more of a chance to go 3rd party because like you said Microsoft has money, Sony does not. Sony does not have games, Only games they have come from 3rd party. Sony has been losing money for years and you. Saying Microsoft has been putting the least effort just proves you have no idea what's been going on. All Sony has done is repeat and recycle, never innovating or doing something new. All Sony has is brand loyalty nothing else and it shows.

+ Show (3) more repliesLast reply 13d ago
LG_Fox_Brazil14d ago

Not sure about that. It's been two decades and I still think about Power Stone, Shenmue, Crazy Taxi, Jet Set Radio, Seaman and others, but I'm not sure I'll remember Xbox Series X/S games in a few years from now... Maybe I'll remember about the franchises that the Xbox brand spawned, but I don't believe that the Xbox Series lives up to the late Dreamcast or even to the Xbox name itself. I do have great memories about the 360 with Blue Dragon, Gears 2 and Lost Odyssey though

isarai14d ago

Nah, sega actually makes good games

Becuzisaid14d ago

No, Dreamcast was ahead of it's time and most still have very fond memories of it that had one. It also had some good games on it even in it's short lifespan. Xbox has none of these qualities.

Profchaos14d ago

I remember it coming out at the time in a really bad place they hit the market before the PS2 but it was during this transitional time when Sony was promoting the power of the PS2 and so many of the Dreamcast games were awesome but often third parties simply ported the PS1 version increased resolution and performance but rarely fully utilise the capabilities of the console.

I think in the end bad marketing done it in and like the GameCube so many people are fond of it now but at the time it was looked at in the lense of the day and it didn't stack up.

Personally I miss Sega in hardware they took risks that many companies won't

Becuzisaid14d ago

I never owned it, and got the PS2 right when it launched. But there were certain games it had that I was always jealous of that I didn't have access to - Sonic adventure, crazy taxi, power Stone, code Veronica, shenmue, skies of Arcadia. I always thought it was a really cool machine though. I've never heard a bad thing about it though from those that had it.

FinalFantasyFanatic14d ago

I only ever saw one Dreamcast, and that was one my friend owned, pity I never got to play it, I wonder what games he had for it?

It would be nice if some of those games got ported to modern systems.

Profchaos14d ago

Oh man sonic adventure on the Dreamcast made me so jealous as a huge sonic fan on the mega drive who also moved to PlayStation 2 I never got the chance to play it back in the day either. The Dreamcast in Australia where I am was always relegated to the smallest corner of EB Games it was kind of a strong first indicator that things were not going well at the time.

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80°

Microsoft Rewards app on Xbox and weekly streaks to be killed off soon

Microsoft has announced the Microsoft Rewards app on Xbox will be discontinued in April and has confirmed that weekly streaks will also be coming to an end.

Read Full Story >>
trueachievements.com