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Massive layoff at Xbox division - closes studio

Blorge writes:

"Microsoft recently announced that the company would be laying-off 5,000 employees due to a drop in profits. This is the first mass layoff in the history of Microsoft. However, news has trickled out that the Xbox division will be suffering the brunt of the job cuts."

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Mr PS33163d ago

About The PS3 Being Doomed !!!

Nathan Drake3163d ago

Just goes to show you how much the higher ups value the Xbox business,ay?

Maddens Raiders3163d ago (Edited 3163d ago )

off right now. I never like to see ((anyone)) lose a job worth having.

MNicholas3163d ago

Microsoft launched the Xbox division to take over the living room.

The Xbox 360, despite massive price-cuts, simply does not have the broad consumer appeal necessary to succeed in this mission. Yes, it has sold almost 9M a year worldwide (average annual sales) and game sales are excellent but being an also-ran in the console market is a far cry from the dream of invading hundreds of millions of living rooms around the world.

Microsoft has realized they went about it the wrong way. Nearly every american living room is about to be filled with very capable Linux boxes. Google is trying to get in on the fun. Microsoft, which has fought for years to keep things the same, has finally given in to the fast approaching realities of media and technology convergence and is realligning it's resources to better meet those challenges.

JaggedSac3163d ago

That article was complete and utter crap. The jobs that have been confirmed laid off have nothing to do with the XBox software or hardware. ACES never did anything for XBox, they did the Microsoft Flight Simulators. M$ is obviously moving away from 1st party games and more towards 2nd and 3rd party. A group of bloggers getting laid off means taht M$ is dropping XBox support? Please. Now it is360's turn for the doom and gloom articles. Especially since the XBox brand was the only real bright spot in their financial reports.

BrianC62343163d ago

This is Microsoft's big problem. They aren't really in any trouble but their shareholders demand profit over anything else. If they're mad something must be done to fix it. Over the last year or so Microsoft has been getting away from having their own developers and more dependent on third parties. Even Bungie is broken off and on their own now. Meanwhile Sony has been building up a great stable of developers to make exclusives for their console. I guess Microsoft will have to keep paying money for exclusive DLC. Can they keep paying $50 million for one game's DLC though?

Godmars2903163d ago

I find it amazing that you're defending MS but calling them "M$"

Muchless that you're saying its a good thing that they're depending more on outside devs to support their system.

Le Idiotce3163d ago

This is something many people have seen coming. Unless, of course, if youre a massive fanboy, you could have smelled this from a mile away.

The XBOX division, together with the Zune, are the most worthless divisions within Microsoft. People talk about how Xbox will last longer than the PS3. And how it beat the PS3. It didnt beat shiat. With 9 billion in red, everyone saw this coming. Steve Balmer might not have cared and might have believed Shane Kims lies and promises that will never come true if the economy is still doing well.

Steve Balmer will sack Shane Kim and not believe his lies when the economy starts to get hurt which is where we are right now.

People, and especially, FANBOYS, need to get a stinking clue. Xbox division DID NOT sell 28 million 360s. They inflated the numbers. The real figure is closer to 24 million. And the XBOX division is 9 billion in red. Hasnt made a dime since it got started waaaay back in 2000. And outlook is not bright, BUT DARK. Because they arent going to make ANY profit in the foreseeable future.

ANY analyst worth his salt, could have told you this. Its simple logic. Pachter is a loser and most likely a 360 fanboy. Anyone that can sit there with a TV camera in front of him and not say how bad the XBOX division is doing but on the other hand bash the most innovative products coming from Sony, is truly delirious. Thats PACHTER.

Microsoft is sacking the majority of the worthless fools at the XBOX division? NOOOOoooooo, realllllllllyyyyyyy? Jeez, my 8 year old brother could have told you this.

The same division that was so desperate to get some Sony titles that burnt 50 million on DLC content for a long forgotten game?
The same division that burnt money left and right trying to convince developers to also bring that game on their system?
The same division that burnt money left and right sending goodiebags to reviewers so the reviewers would always nickpit PS3 exclusive games while glorifying inferior games on the 360?

Noooo reallllyyyy? The same division that hasnt made a dime since they started but managed to burn away 9 billion from Microsoft?

This division getting the brunt of Steve Balmers wrath? Noooo reallllyyyyy?

Bungie didnt jump ship because they wanted "freedom". What, freedom? Were they slaves?
Ensembles Studios got closed down?
PGR contract ended just to save a nickel but 50 million for some worthless DLC content, is money well spent?

Didnt they say HD DVD would win? Didnt they say digital download would take over by the end of 2008. Didnt they say XBOX is recession proof? Did they not claim how they were the first to invented Miis? Werent they the ones who kept talking trash when speaking about the competitors?

Nothing but lies comes out of their mouths. Trust them, board their ship, and youre going to sink to the bottom of the Atlantic.

The clues were all over the place. Written all over the frikkin wall. And only if you are one BLIND fanboy or bribed, did you kept defending them.

Saint Sony3163d ago (Edited 3163d ago )

Closes studio.... it means we won't have another Flight Sim?.. OMG!

Seriously, I did not even know they still made them?!.. lol
Played one last time hmm... at 89 or 90 something, when 286 was considered damn powerful PC.

DaKid3163d ago

Dude, that wall of text you just wrote was just bad.
After reading some of it I realized you have no idea how businesses work example "With 9 billion in red" sorry to tell you but no company in the world keeps track of how much in the red they are, that is not how businesses work, the reason is becasue its sunk costs, there is no account out there that says they must pay it back. Anyways right now the Entertainment division is bringing in revenue, that otherwise Microsoft would not have. The same goes with Sony, eveyone that says these companies are done for are extreme fan boys, or have never went to school past 12th grade. here is Microsofts report for last quarter

http://www.microsoft.com/pr...

Anyways lets look at this for what it is, more people loseing their jobs which is never a good thing. I feel for these people, and hope things start to get better soon, but I also realize that things will still get worse before they improve. I am an Economics major, and have a pretty good understanding of the current problems.

Blademask3163d ago (Edited 3163d ago )

so lets not stoop to their level.

Sucks that they are losing jobs, but no need to rub it in the 360's face. We all knew it was going to happen, because its happening to everyone thanks to Mr.Bush & the idiots who wanted everything for nothing.

Everyone needs to squash the issue. Even though 360's threw it in our faces, we don't need to return the favor.

Le Idiotce3163d ago (Edited 3163d ago )

Stopped counting rofl. Next time, you get your paycheck, dont count at all, fool.

Lmao can you believe this guy. "Stopped counting"

I stopped counting nickels, pal. When it comes to hundred dollar bills, I count it 5 times over!

Listen to this guys. Guy claimed that Microsoft "stopped counting" when billions are involved.

StephanieBBB3163d ago

That they hire the Xbox programmers/writers that has been laid off. It would be a smart buissness move and they could get some serious software programming expertice.

DaKid3163d ago

if you want to think about it as they stopped counting go right ahead, I was just trying to clear up this notion that they must pay off the "9 billion" before they can make a profit, when the truth is they don't if they make a profit for a quarter as they did, then its just that a profit. They do not compare it to the money lost.

The Lazy One3163d ago

you can also ignore the fact that the xbox part of the entertainment and devices division is actually the best part.

The zune and games for windows live teams were the worst, and that's where the bulk of the cuts were made. Also in RnD and IT.

There's plenty of links with Balmer's email to the company if you google it, and he says where most of the jobs are coming from. Of those 5,000, approximately 2,000 are going to get rehired in other divisions of M$.

I'm going to get disagrees, but they're going to come from ignorant people that hate microsoft because sony's been massaging their buttholes oh so gently.

Why dis3163d ago (Edited 3163d ago )

I'm going to have to read this "new info" I thought one of the studios in Microsoft game studio's was let go(flight sim will be lost lol).

This is nothing but mixed facts and some rumors used to paint an untrue picture.

patterson3163d ago (Edited 3163d ago )

It reminds me when they were selling HD-DVD add-on drives for $19.99 or whatever it was, anyway, they were practically giving them away. Then there were the viral campaigns and big talk how Blu-ray is dying or irrelevant, HD-DVD is the future BS...

It's the same thing lately but replace it with PS3 is dying or needs help and XBOX360 winnar!!111!...

Same BS

The reality is, PS3 is on the upward slope while the 360 is slowly getting buried in debt with all the money they've been throwing around for the past 2-3 years. Sooner or later that type of recklessness catches up to you, especially in these times.

Why dis3163d ago (Edited 3163d ago )

The studio that was axed was in the PC side of microsoft games studios lol.

No Xbox studios were axed in the microsoft games studios. lol

PS3 fanboy BS finding a mess of a collection of rumors and facts mixed all up for bait.

PS3 is getting smoked, the monthly numbers are reported by tracking companies. Thats funny PS3 fans try to paint fantastic realities with broken news. what you're saying doesn't make sense.

YoMeViet3163d ago

I'm sorry but do MS have any xbox360 game studios left to "axe"?

Why dis3163d ago

Just pointing out the fake ass news designed for angry fanboys.

EXCLUSIVEGAMER3163d ago

it sux to lose your job right now. lots of uncertainty in the economy....unless your a pron star.

Bathyj3163d ago

Sorry, but I think Le Idiotce made alot of sense, while Dakid made little.

You can call it sunk costs or right offs if you want, but the fact is, the xbox experiment is a big open hole where M$ tips money into to make it disappear.

The fanboys are always on about numbers, sales, quarterly profit etc, but always ignore the path they took to get there. The fact is, a couple hundred million PROFIT isn't so great if you had to spend billions to make it. Its only profit for the quarter or year. Those billions came from some where, and were needed to get Xb into the position its in so it could make that profit. You cant ignore it. That would be like driving 100 miles to save a buck on gas. You say they do not compare it to the money lost. Not maybe they dont publicly, so they're not constantly reminding us that yes you might love Halo, but XB is an economical failure.

You might be a eco major and have plenty of booksmarts, but I'm a business man, and if it cost me 1M dollars to establish a business, and I make 50 grand a year "profit" for 10 years, then I lost half my money and my business is a failure. I cant pretend that million didn't exist. Oh that? I wrote that off, I actually made 500K.

drewdrakes3163d ago

Most of you can head straight to the open zone for that kind of talk. Sony will be making job cuts too.

The Mikester3163d ago

the same thing is happening to Sony.
it's sad but they have to do things like this

DaKid3162d ago (Edited 3162d ago )

Wow, look at the disagrees I got up there. Sorry I stated actual business facts. This site is something else. Here is another example, Sony lost money last quarter, they do not need to pay it back, its gone, no more. Another example the auto industry in the US, hasn't made a profit in god knows how many years, they too don't pay it back. The higher ups do not go "ok we are only 10 billion in the hole after the profit of 50 million". if you guys would pull away from this website for just a few hours a day, you too could receive an education.

I can't believe that, this site is just amazing. I have both consoles and love them both, and just try to give correct information on how the world works within business.

@Bathyj
Starting a business, and introducing products are too different things, needing too different mindsets when undertaking each. Anyways when starting a business you should not expect to make a profit the first year, you will not go bankrupt because you can right off up to 3 years back, in taxes (at least in the US) and if you are making $50 thousand profit each year, I would not say your business is a failure, but rather a success. Remember profit is after all expenses have been paid, meaning you already made your money for the year in whatever your salary is. but you all ready know that right?

Le Idiotce3162d ago (Edited 3162d ago )

Did you hear that ladies and gentlemen. We dont have to pay it back.
Who said anything about paying back. The investment MS made in the 360, is an investment. Its not debt. So why do they need to pay it back.

They need to make back their initial investment or its a massive loss. They invested around 10 billion in the RROD machine and they have barely made back several 100 million. Meaning they lost 9 billion. Thats 9 billion down the drain. Thats FKED up investment.

If an investment does not guarantee me any return, I sure as hell would not invest in it in the first place. And Im pretty sure 99% of the sane and not stupid people would agree with me.

Which means the circle is complete. I am now back to where I started and you clearly have no clue how the world works.

If 9 billion in red, and counting everyday btw, is not a massive failure than I dont know what is.

Lmao why dont you ask Kevin Costner how he felt after Waterworld made him 60 million in money. A project he invested 120 million in. Ooohhh suuurrrreeee he doesnt have to make that money back. Jeez, wtf is wrong with you! That money is gone forever, fool! Its not like he is getting his 120 million again.

Its not like the bank is playing a trick with Costner and credits him that 60 million once he reaches 65 years. The money is gone. For good. Do you have any fking clue what that means.

Clearly you do not.

And in times lie these, it makes sense for MS to kill off its weakest links. The Xbox division is a bleeding death division. Its a liability more than else for MS. It hasnt made a dime, lost huge chunks of money, the outlook is grim, the forecasts are dark, why the hell would Steve Balmer allow a machine that also defects on you 33% of the time, to ruin his company again?

Because thats what the XBOX division is. A failure of an investment.

shovelbum3162d ago

That sucks for the employees, fanboy or not. Nearly all companies are trimming their workforce so it isn't likely to affect us gamers in a major way but I guess the Zune will be going the way of the Dodo.

s droid3162d ago

just go away, you really have no clue do you.

blademask: why have you turned into a sony fanboy all of a sudden??? after being an xbox fanboy for ages, i can only conclude, that this sudden about face is to get back bubbles by sucking sony! yes everyone knows how it works on n4g: if you adore sony you get your bubbles boosted, and you get them raped by the sdf if you dont show enough love to them.

sad i know, but thats n4g and it's community for you. but, instead of pretending when everyone surely remembers your posts, why not just get another account?? much easier me thinks.

The Lazy One3162d ago

Take a flippin business course. Christ.

you go into debt when you take out loans. Those you have to pay back. If you spend your own money, there is no reason to pay it back.

If you have a buck in your wallet and you buy a candybar, do you need to make a dollar back to not be in debt a buck? no. At least I'd hope not, because you're paying twice as much for everything.

+ Show (25) more repliesLast reply 3162d ago
Nathan Drake3163d ago

I'd rather they axe the Zune project than another 1st party dev.Zune has completely failed at retail and the Xbox business-while not setting the World on fire-has actually showed promise and has definitely gained a higher amount of attention this generation than it did last gen.

So in short;Terminate the Zune+strengthen the first party dev teams.

Godmars2903163d ago (Edited 3163d ago )

All of this "buzz" of which you speak of was pretty much all self-generated. About projects that were created on the heels of another's success trying to steal their market share.

In other words, if this "buzz" was anything genuine and honest, wouldn't it have translated into sales? If MS ever had an original thought wouldn't the Zune have come out before the iPod?

The Lazy One3163d ago

why did you put "buzz" in quotes when he never said buzz?

drewdrakes3163d ago

Ive been messing around with the Zune and programming it, its actually a fantastic little device with a lot of potential. Maybe you should try it more before saying they should give it the ax?

wanderofys3163d ago

I usually agree with your opinions, Nathan Drake, but I really like my Zune. The fan made games are neat, the absence of a scroll wheel is a blessing, and it functions really well. It's also pretty much the only Microsoft product I know of that doesn't make you pay for additional content.

+ Show (1) more replyLast reply 3163d ago
Nathan Drake3163d ago

"The journalist also stated that the game division will receive a massive management restructuring next week. In the corporate world, management restructuring usually means firing and consolidating. Could this be the end of Aaron Greenberg?..."

As much as Greenberg spews arrogant nonsense and dishes out false information to the public,I would be greatly disappointed if he lost his job at Microsoft.

He seems like a nice guy when he's not in douche-mode.

badkolo3163d ago

oh stop the gloom, sony is laying off more people today as well, watch the news and dont just wait for news to arrive at n4g.

Times are tough and all companies alike are cutting back and firing people, its time to tighten up the budget.

PirateThom3163d ago (Edited 3163d ago )

Yes, but on a gaming site, Microsoft's cuts are more scatching and have an effect. If you want to talk economics, N4G is probably not the place.

Sony were in the red last year and they are not firing people from their gaming divisions, their "cuts" to gaming was to merge two studios into one building to reduce infrastructure.

Microsoft actually made money, but less than expected and are firing people from their gaming division on top of having only 3 first parties and that money well is going to tighten for third party hand outs in this economy.

Forgive the "gloom and doom", but Sony had to deal with it on gaming sites even though SCE has remained largely unchanged, while Microsoft are scaling down their gaming division and no one seems to be worried at all.

It's a shame so many people are getting screwed over by this recession, but on N4G I tend to discuss in terms of what it means for gaming.