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Is the Xbox 360 in trouble?

LukaX23 from TheGamingOwl Network writes:

At least from the position the gaming world is in now. Sony's catching up, and it's only a matter of time until both consoles are battling for what really matters, and what should still really matter in the gaming world - games. It's lately been about who's got the best online, but those will be almost identical sooner or later and it will be back to the basics.

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meepmoopmeep3162d ago

lol, i so want to approve this too.
i mean, blogs are allowed but, man, lulz.

cereal_killa3162d ago

Grabs Popcorn finds a seat and waits for the fun to begin.

kewlkat0073162d ago

This is not Popcorn material...there is no sale numbers or polygon counts.

Dread3161d ago

lets see how the Sony fans react. Are they gonna agree and laugh or are they gonna call foul and argue that everyone is against MS and it is not fair for gamers.

lets see if there is some integrity or just plain fanboysm

Anon19743161d ago

When looking beyond the current sales and what place all the consoles are in, there are certainly underlying causes for concern regarding the 360.
Almost all of last year the 360 showed zero sales growth, some months actually reporting signifcant drops in the US from 2007 numbers. The price cut, which came at a great cost based on MS's last financial quarter, pulled sales up but what was the root cause of the 360 not being able to keep up before that? Do those issues still exist? Even when MS games is making money, take away XBL revenue and suddenly they're in the red again. What's the issue with hardware and software sales that makes this the case?

We can see based on worldwide sales that the PS3 is selling much faster than the 360 ever did and that has to be concerning in the long run. Why is the PS3 being adopted faster than the 360, and why has the 360 again struggled to find it's place outside of the US?

It's even been argued that the 360's current attach rate, something that wasn't even discussed last gen, is evidence of a problem as well. Microsoft's own data seemed to show attach rates jump whenever a hot new release came out. Contrary to how that looks, VG Journal reported that this was evidence of a hardcore problem. Hardcore gamers tend to buy all the hot new releases, but catering only to the hardcore is not a long term recipe for success. Just look at Banjo Kazooie sales vs Gears2 for evidence that the hardcore seem to be the only ones driving 360 software sales at the moment while games like LBP seem to sell steadily over time on the PS3.

Anyway, just a couple of thoughts on the issue.

SupaPlaya3161d ago

Doom and Gloom article # 3255544667

cereal_killa3161d ago

kewlkat007 just because it has nothing to do with sales or polygon counts doesn't mean it wont be entertaining.

eagle213161d ago

My lord, even Mass Effect can't be denied at GDC for PS3.

And it's painfully obvious the PS3 has the hottest quality Exclusives. :)

BattleAxe3161d ago (Edited 3161d ago )

With the massive hardware problems coming from RRoD, E74 and Disc Scratching, Microsoft is having to fork out alot of money in repairs. 1/3 of all 360s sold are repeat customers who have had their 360 break on them once or twice before.

With Halo Wars being such a huge disappointment, 2009 is really shaping up to be a crappy year for exclusive games for Microsoft.

I think that MS needs an economic bailout.

Hutch23553161d ago

A bailout, you must be 12, I know only turning billions in profit during an economic downturn shows they need help. What a moron.

Nelson M3161d ago

Up Sh!t Creek without a Paddle !!
Haa Ha

The Lazy One3161d ago

"take away XBL revenue"

if you're going to take away it's revenue, you have to take away it's cost too. it's not like they run it for free.

Also, M$ was down in the beginning of the year, and way up at the end. They're continuing an upward month to month trend. I don't understand how you can think that's bad. The more you generalize the less analytical it is. Week to week sales would give the best trend analysis, followed by month to month, followed by quarter to quarter, followed by year to year, followed by lifetime(which always trends linearly). When month to month data is available and shows a trend, it will almost always be the preferred trend to watch over year to year.

XxZxX3161d ago (Edited 3161d ago )

Hutch2355, dude Microsoft reporting a loss too last quarter
EVERYBODY now reporting a loss last quarter.

JokesOnYou3161d ago

"Is the Xbox 360 in trouble?"

-hmmm, so all the screaming about HHG's headlines but at least he has a show that is allowed under the rules to be submitted, this however is just some sony loyalists submitting a blog post, might as well take the comments from nasim's next account and submit it as news. lmfao

JOY

KingME3161d ago

The sad thing is that you blogged something, and then submitted it as news on N4G, which is pretty desparate. Here are my comments toward your article:

LukaX23, it's not that 360 fans are going to be huffing and puffing. From what I read, all you did was boasted and bragged about what Sony and the PS3 has and pointed out negative things about the 360. (A typical fanboy rant) If you want your writings to be taken seriously, then don't type stuff that makes you sound like a one sided Sony fanboy, praying once again for something cool for Christmas. Your article has provided absolutely NOTHING new, which actually makes it quite pointless. You only wrote this to make yourself and fanboys like yourself feel better.

That's my take on your article.

The only thing you were able to bring up about the 360 was E74, and RROD both old well known problems. However on the PS3, you had plenty of things to say about the future, you even mentioned some games and other stuff none of which you mentioned for the 360. You read like a Sony marketing ad, not a neutral party. But then again, you're not a neutral party.

XxZxX3161d ago

XBOX 360 fanboy will lol off XBOX 360 is in trouble but they will make sure people get the PS3 is in deep trouble message. Same goes to PS3 fanboy.

U know what, PS3, XBOX360 and Wii is in trouble. They are losing momentum somewhere else, either japan, US, or EU. Trouble ahead for all of them.

UnwanteDreamz3161d ago

If you are in this comment section talking trash about the 360 then please don't ask why we get 10 "PS3 is doomed" articles tomorrow.

Anon19743161d ago (Edited 3161d ago )

It's a bit of an oversimplification on my part to say "Just subtract XBL revenue." I realize that it costs money to run XBL, but it can't possibly be that much, can it? XBL brings in approx $700 million each year based on Microsoft's numbers. Even if XBL cost 100 million a year to run the loss of that revenue would put MS games back in the red.

Also, the trend over the course of the year was one of decreased sales over 2007 sales, especially in the US. Actual revenue increased, escpecially over the holiday period but profit shrunk by 60% vs 2007 sales. So, they sold more, brought in more money, made far less profit over the previous year (that's right, XxZxX. MS games made money last quarter). That has to be the price cut at work.
That's one of my conerns regarding the 360's future. Seeing sales decline in 2008 vs 2007 only to pull it up at the last minute with a price cut, that's a concern which is obviously why MS felt a price cut was needed.
I don't know. Maybe it's nothing and the price cut fixed whatever was broken with 360 sales, but I have a feeling it's not the 360's price that was holding it back overall. I think the 360 is a far better gaming console than the Wii, it's cheaper and yet it's still being trounced in sales. What's wrong with this picture?

The Lazy One3161d ago

I think you underestimate the cost of xbl. xbl revenue includes revenue from xblm, and the hosting on that is not free. Not to mention licensing costs on some of the content there, as well as the stuff just stored in the xbl community servers.

And I never said the price cut didn't hurt their profits. Obviously it did. I was just pointing out inconsistencies in your analysis. I'm actually interested to see how a PS3 cut would affect sales of the 360. With the 360 dropping so low it's hard to say if it can tap into the wii market, or if the increased sales are mostly between it and it's primary competitor sony.

I still think the increased sales over the past months outweigh the losses at the beginning of 08.

KingME3161d ago

" I think the 360 is a far better gaming console than the Wii, it's cheaper and yet it's still being trounced in sales. What's wrong with this picture?"

Take your same question replace "360" with "PS3" and replace "Wii" with "Wii & 360" and perhaps you can provide an answer.

RKRigney3161d ago

I swear I thought this would be a HipHopGamer article. But a free blogspot blog? I didn't even expect something that low from N4G. Surprises me all the time.

xwabbit3161d ago

Well almost everything on nag is from Blogs, BloodMask is a legend posting blog's on Nag.

Arnon3161d ago

Just needed to say.. but um

1. The 360's sales have increased this year when comparing them to last years sales in each month thus far. Playstation 3's (and PSP/PS2) sales have dropped by about 17% in the states so far when looking back at last year's sales.

2. The 360 sold 10.8 million consoles last year as compared to the PS3's 10.77 consoles sold.

3. The 360 is constantly making a profit. What exactly is the trouble? The only brand so far that has shown trouble (literally) is Sony.

4. And to the guy who said Halo Wars was a 'flop' in terms of sales or something.. the game has already broke around 1.3 million copies. Not sure where you get that sort of information.

dcbronco3161d ago

You have got to be one of the most delusional fanboys on this site. The 360 is not losing money firstly. They make a profit on each console sold. They also sell more games than PS3 which is more profit. You mention the financial reports but obviously have no idea what counts on MS's ED division. Sony's games division is games period. E & D includes Zune(which is failing), Surface(still more R & D than anything), marketing for Microsoft Office for Mac(no idea why), all of MS's TV and Web devices and a few other things. The Xbox is the only thing that actually makes money in that division and it still turned a profit the last few quarters. Office advertising has been estimated at several hundred million on it's own while no Office profits get counted for E & D.

Now the PS3 may have been adopted slightly faster over the first two years. But it is losing ground now. It has also had sales declines in the last few month compared to previous years. So I'm not sure if MS should be worried. With Sony so jammed for cash and there seemly being a low possibility of a price cut, it's Sony that should be scared. Oh, and Blu-ray is not selling like Sony pretends. The up 300% stuff got old and didn't convince anyone paying attention.

Sony needs to take every dime they saved with layoffs and mergers and put it into a $100 price cut on the PS3. Blu-ray ain't gonna happen and Samsung will hold TVs unless Sony can make OLED viable, iPods aren't going anywhere either and Sony will never own home stereo equipment. Getting back a larger part of the VG market, which is growing, is the only thing that can help Sony now.

SprSynJn3161d ago

See there is the problem though. We know why the PS3 is losing to the Wii in most areas and why it is losing to the 360 in the U.S.

Price.

As you no doubt have read, the PS3 is now outselling both competitors here in Japan despite it costing substantially more. In Europe it appears to be neck and neck with the 360, again costing a great deal more. Could you imagine would happen if the PS3 did receive a price cut? Most titles on the 360 can be found on the PS3 as well, with free usage of the PSN. Blu-ray is an added bonus that most would utilize if they purchased it. While I have no real interest in the 360 nor it's future, the odds against it are enough to make fans worry me thinks.

s8anicslayer3161d ago

I know one thing, speaking from an unbiased position, if the 360 didn't have the RROD problem or the E74 or the disc scratching OH! wait a minute, DAMN they are screwed, not! Even though it's costing MS millions in lost revenue to repair these broken 360's, the 360 has put MS in a postion they had only dreamed of and that is ahead of sony! maybe MS planned this, I wouldn't put it past a company like MS.

ThanatosDMC3161d ago

Umm... im guessing their solution in the article is a price drop, huh? Or take out the DVD rom and put in a CD-rom?

Anon19743161d ago

@ The Lazy One. We're not talking XBL revenue from games sold, content, etc. We're just talking straight revenue from fees. MS says they have 17 million gold accounts. At $50 each we're talking $850 million. I low-balled my $700 million figure. Either way, my point is it's a revenue stream that, if taken away, would most likely put them in the red when their only profitable year only saw them make $400 million. So is the console and software even profitable yet? Doesn't look like it from these numbers.

KingME said "Take your same question replace "360" with "PS3" and replace "Wii" with "Wii & 360" and perhaps you can provide an answer."
You don't here me saying the PS3 is in any better shape financially, do you? But this article is about the 360, not the PS3. What the PS3 makes right or doesn't make doesn't change what we're discussing.

@ Arnon. Good points! But you're missing a couple of things. MS sales are up, revenue is up, but profit over the holiday season was down 60% over the 2007 holiday season. Increased sales, increased revenue and yet 60% less profit. That's a huge concern and can only mean that the recent price cut has moved MS back into the position where they're taking a loss on every console sold. How else do you explain increased money coming in but decreased profits over 2007? Remember, we're just talking about the 360 here. It doesn't matter if the Wii outsells the 360 outsells the PS3. Too many people try to shift the focus on the other guy, but that doesn't somehow change the fact that MS's 360 price cut is gutting their profits, and the MS games division wasn't very profitable to start with. That's a huge concern.
And I agree, nothing wrong with sales of Halo Wars. A console RTS breaking one million in sales. That's quite the feat.

@ dcbronco. I didn't miss anything, I know full well what MS entertainment entails. So, how do you explain the 60% drop in profit last quarter when they sold more and brought far more money in than holiday 2007? What's changed? Only the price cut. The only explanation is that the 360 is being sold at a loss again: Increased sales actually equals a profit drain. That's exactly what we saw this last quarter. The other products lumped in there really don't have that much of an impact up against the 360 as you can see from MS's own financial statements.
Despite a slight knowledge demonstrated regarding what MS Entertainment entails, you seem to be laboring under the false assumption that PS3 sales mean something here. They don't. Sony could sell one console or 100 million and it doesn't change those numbers that MS is currently reporting. Shifting the attention to Sony like somehow that will make the things I've pointed out untrue doesn't work.
Also, I don't know where your data is coming from but Sony hasn't actually announced official ship numbers yet so we really don't know how they're doing compared to last year. All we have is the NPD's and VGChartz best guesses. In fact, for a 360 article, you seem pretty obsessed with how Sony's doing. That's not what this is about as we can surely fill another entire column with Sony's current woes. You don't hear me saying it's all smiles and sunshine over there. Don't change the subject.

In fact, none of you really addressed the MS issues I brought up except to say they don't exist, even faced with easily verifiable financial data from MS. Pointing at Sony and yelling "Look over there!" doesn't change a thing.

dcbronco3161d ago (Edited 3161d ago )

What changed for MS over the last quarter? How about the new Zune. It was a dismal failure. They couldn't pay people to take one. And don't forget that MS spent millions advertising the new Zune for basically no return. You think they might have signed some kind of deal with Netflix too. They might have. And as far as the price of the 360, people seem to think MS doesn't get price adjustments like other companies. Search the net, they started getting them after year one of the 360 and they have gotten one each year since. Oh, and there was that little die shrink. That knocks a lot of cost off. Just like the one on the CPU the year before. Remember they own those parts this time so they get the savings on manufacturing cost. The other change, could that be RRoD. They most likely blazed through that billion. And since I believe the failure rate is higher than they admit, I wouldn't be surprised if that isn't still holding profits down.

So there are several reasons. Zune, which looks like it will be discontinued. Netflix, I sure it cost them something. And RRoD, the billion is long gone. And I would also bet there is some Xbox 720 R & D money in there too, consoles don't make themselves. Funny thing is, if you take away the expense of RRoD, the 360 would have been profitable for some time now. That billion dollar charge hurt the previous fiscal year. ED has made money for a year straight with this quarter, take RRoD away and you could add two or three more quarters.

And as far as sales go, VG is a poor man's estimate. NPD on the other hand is based on actually numbers from most of the major retailers(Best buy, Target, Walmart and many others). Their numbers are considered as good as actually and most companies in America base there decisions on what's selling according to NPD. They make their money by selling that information to companies like Microsoft and Sony. Never throw them in with VG, they are two totally different things.

Oh, and Sony shipped numbers. Yeah, Sony is really good about talking about what they want to and what they don't. They allow NPD to release PS3 numbers, but not Blu-ray. Which means they are really humble,not, or they are ashamed of the numbers. Number came out about Samsung owning 26% of the LCD market, which is most TVs now. 26% was well above Sony and anyone else. Do you really want to question the iPod thing. And again with Blu-ray, go to Home Media Magazine and find a movie that they give a actual sales number for. Look through the digital copy of the magazine and you will see a chart that list the percentage of sales for the top movies. If you know the DVD number and look at the percentage that the chart list for Blu-ray for that movie, you can estimate the Blu-ray sales. They are very low on most movies. And if the up 300% claims really meant anything, Sony would release actual number.

Hutch23553161d ago

Actually no they didn't post a loss. 8.9 billions shares outstanding, and 1.88 net profit per share idiot. Can you at least do math. geez the ignorance on this site astounds me. Msft has not posted a loss that I can ever remember. As a stockholder that gets yearly reports I think I would know when they actually lost money. Your thinking of Sony.

+ Show (28) more repliesLast reply 3161d ago
ShabzS3162d ago

ooo boy ... somebody approve this... theres nothing on tv tonight

II Necroplasm II3162d ago

We must see this! everyone here loves these fanboy blogger thoughts.

Zeus Lee3162d ago

Keep telling yourself that

LukaX233162d ago

Me, a fanboy? Far from it friend. Because I say the PS3 is catching up doesn't mean I'm a fanboy. I'm taking a look at the state of how the gaming world is and how one thing affects another. That isn't fanboyish, saying so is being a fanboy. Not everyone will agree with me and it will never be that way, so I suggest you keep quiet for your own good.

snaz273162d ago (Edited 3162d ago )

and i love it as much as the next man and i dont disagree with what your saying but can i ask you something... can you really say your not a fanboy when you have the playstation symbol as your avatar? atleast can you expect to be taken seriously? im not having at go at you btw.

brycespitler3162d ago

and at the end you went off on a rant about 360 failure rates of e74

we still dont know if the failure rate is that prominent yet

sounded kinda fanboyish...im no 360 owner but c'mon you coulda left it out.

otherwise your other opinions were fine and enjoyable to read

ShabzS3162d ago

hahahah

''Microsoft claims they've "fixed" the problem with all there different motherboards. Still, they're breaking left and right.''

^direct excerpt Including the grammar

dont worry man.. the stuff u've said was definitely well researched with hard numbers to back it up... u didnt sound fan boyish at all..

GamerPS3603162d ago

I am a Fanboy !!

And I have PS3, 360, Wii, PC and PSP.

I don't like PS3 'coz its black. I don't like 360 'coz its white, I don't like Wii 'coz its small, I don't like PC 'coz its huge and I specially don't like PSP 'coz it just fits on my palm.
I don't like games 'coz I play sales and comparison.

Oh, I like food :D and I am a Fat Fanboy.

Why o why3162d ago

that is sooo true of many on this site. They've got their priorities all msed up:)

ultimolu3162d ago

You have some interesting points but this is going to erupt into yet another fanboy war.

green3162d ago (Edited 3161d ago )

So why did you approve it?

EDIT:I can see that now but i was quite surprised to have seen your approval earlier.

How the hell did i go from 8 to 4 bubbles in 24 hours without making a comment?

ultimolu3162d ago (Edited 3161d ago )

green, did you not see that I pulled my approval?

EDIT: I read the blog post, that's why. I then decided that this was going to turn into a huge fanboy war in seconds so I removed my approval.

And...idek what happened to your bubbles. o_o

Nasim is pretty annoying. At first I didn't mind him but he makes PS3 fans look bad.

I'll give you a bubble.

green3161d ago (Edited 3161d ago )

Maybe nasim attacked me with his multiple accounts,lol. Anyway i don't know and really don't care that much.I have always stuck to commenting on 360 related articles (because that is the only console i own) and hardly ever make more than 2 or 3 comments.Anyway i got to start being careful now.

EDIT:Thanks

+ Show (6) more repliesLast reply 3161d ago
LukaX233162d ago (Edited 3162d ago )

IF I PUT A QUESTION MARK, THAT WILL MAKE THE WHOLE ARTICLE NON-FANBOYISH. WATCH.

Update: And I suggest reading it! There are some valid points in there.

Ldubbz3161d ago

You think you have some good points? You do know a good piece also contains counterpoints as well?

You asked a question that doesn't need asking. The 360 is doing quite well, and everyone but the most delusional fanboy knows that. Why try to create doubt from nothing? Unless you want to start a flame war.

And as for the "doom" articles with PS3 vs 360; they both can be completely ridiculous. But you also have to remember that the 360 and PS3 are not in the same position, nor are Sony and Microsoft. When the PS3 gets outsold by the margin it did during the holidays, and has a decrease in its YOY numbers for this year, there is more reason for concern.

That doesnt mean you get carte blanche to write FUD about it, but you can question where its going. The 360 is not immune to this either, since the Wii is chillin in the top spot.