Bach On The PS3, Profits, and Handheld Possibilities

Kotaku reports some interesting comments by MS's Robbie Bachs which give rise to speculation of a handheld xbox360? You decide:

The Edmonton Journal caught up with Microsoft Entertainment and Devices president Robbie "Xbachs" Bach at CES this week to discuss the success of the Xbox 360. They revisit an interview from four years ago, when the original Xbox was trailing behind the PlayStation 2, where Bach promised that Microsoft would be ready for the next generation.

"Well! There you go, prophetic," Bach said enthusiastically. "In fact it has been a role reversal. We were on first this time like they were last time, we had a product that was more price-competitive this time, and we had a higher attach rate."

[Maddens Raiders]

They revisit an interview from four years ago, when the original Xbox was trailing behind the PlayStation 2, where Bach promised that Microsoft would be ready for the next generation:

The crystal meth talking: "Well! There you go, prophetic," Bach said enthusiastically. "In fact it has been a role reversal. We were on first this time like they were last time, we had a product that was more price-competitive this time, and we had a higher attach rate." (don't mention reliability, rrod, scratched discs, ww declining sales to the PS3 on a weekly basis, no MGS4, FXIII - not happening)

The liquor talking: "Halo releases have been the only time the E&D group have actually posted profits..." but Bach is keeping his eyes firmly on the long term. (translation: get ready for a new box in '09)

What warmed over BS. Handheld possibilities? So what now your into hand grenades? Give me a break. They would get taken *deep into the woodshed if they brought a new handheld against Sony and Nintendo. Can't even fathom it. Zune anyone?

[mighty_douche]

Of course M$ will jump on the band wagon. Handhelds are selling extremely well at the minute (probably due to high console prices).

Where theres money available, M$ are normally soon to follow!

Lets hope its not another "ipod killer" like the Zune. lol... the PSP/DS probably arent to worried right now.

[eagle21]

and outsold 360 in 05', 06', 07', and last week. lol. That's just ps2!

[name]

Kotaku -_-

And it's not actually a role reversal at all. Since the PS2 is still outselling the 360. When the PS2 came out it wasn't being outsold by anything when it had its franchises out, let alone a last generation console that killed the console before it. The interview pretty much echos Microsoft's ambitions to create a playstation. They want the playstation's franchises, marketshare, and reputation. The problem is the xbox is NOT a playstation, it's an xbox.

If 360 owners wanted a playstation, they would have just bought a playstation. They want to be the "PS2" of this generation, but they're not willing to have the same standards as a playstation. They're not willing to innovate, they just do whatever's already selling and try to make sure whoever started it isn't still in business.

[mikeslemonade]

Let see what he says this year when PS3 sales catch up to the 360. Role Reversial his butt because the PS2 never got beat by anything. 360 loses there one year lead to the Wii.

[chrno6]

Name, you are absoutely right in that MS is trying to be the ps2 of this generation. But how can it be when it is still outsold by the ps2 worlwide (and the ps3 weekly)

[ApocalypseShadow]

they're having to struggle to stay ahead as it is with 360.

how can a company abandon its fanbase with xbox,but expect them to be there with 360?

how can a company that calls itself the leader,not be able to beat the competitors last gen offering in sales......even 2 years later?

how can a company that has billions of dollars,not be able to sell more consoles in its second year compared to it's first?(10 million.then,7 million?even with big hit games?

how can a company claim to be ready for the next round,but had to go back and rework its console because of:

RROD
claiming 1080p was not necessary.but then add an update for it.
claiming larger hard drives were not necessary.but then add it.
claiming hdmi was not necessary.but then add it.
claiming their servers for online is fine."THE BEST!"but lately,needs dedicated servers because it's crapping out.
claiming download file sizes were fine.but then castlevania and sony's psn,changed that theory.
claiming hd-dvd the better buy.but it now looks like bluray whooped hd-dvd's @ss.
claiming motion control a fad.but then nintendo kicks their @ss with it.and gains the lead.now they(microsoft)want motion control.
claiming digital downloads are the future.but only after bluray's obvious victory.and thinks everyone is using broadband around the world.i live in america.but the world is not america.

everything this gen has been backpeddled by microsoft.and the fanboys have jumped from fanboy excuse to fanboy excuse on microsoft's f#ckups.and now qoute EXACTLY what microsoft is quoting lately:"look at our attachment rates."who gives a f#ck.are systems being bought?

still want those third parties to make games and not jump ship eh microsoft?maybe the rest won't get bought away like bioware and bizzare creations.oops...did i say that?

seriously.what has microsoft done right?it sure wasn't releasing early.nintendo killed that lead.here,i'll give you guys one:they have courted more third party devs with money.

here.i'll throw you 360 fanboys another bone.sony backpeddled on rumble(lawsuit.....ho hum....lawsuit).ooohhhh weeeee!.you got us on that.ooooohhh weeee!

the train has been hitting you guys hard lately huh?sorry,but it aint over.there's more to come.and we knew this from the announcement of ps3 and the target videos.and that trojan horse(bluray) had ps3 gamers sitting inside waiting to pounce.your castle is being overthrown as we speak.

mag lev......................

[Warbletot]

Chaaaaarge.....!!!!

[anh_duong]

handheld gaming is the future.. i have no doubt that the biggest fastest growing segment of gaming is handheld.. you only need to look at the month on month sales to see how big handheld gaming is...

ms is 100% working on a handheld.. it will be comparable in spec the original xbox, has touchscreen and motion detection.

[crck]

trying to break into the market. The handheld market is growing because the audience has expanded to include more women and small children. That is not a demographic MS has had any success with. The Xbox brand is known for ultra violent games which will not translate well to the handheld market.

[kingboy]

Well, anything thing Sony touches it`s hands on they`ll obviously follow even if making profits isn`t top priority for the company..something like "because my brother has a green shirt i`m bond to have one too"Just a common practice by Microsoft corp.Apple does it and they follow

[Shadow Flare]

Robbie Bach- "....and we had a higher attach rate". Attach rates are the statistic of an idiot. Look at ps2's attach rate. It was poor. PS2 is the most successful console ever. Look at xbox 1's attach rate. It was high. It failed. It failed pretty badly compared to ps2.

So what's a high attach rate mean? People are buying lots of games right? What kind of people? Hardcore gamers. Why's that a bad thing? Because hardcore gamers aren't where the hardware sales are. Casual gamers are the ones that rocket hardware sales, look at the wii. And the ps2 had a huge slew of casual games. However casual gamers aren't neccesarily where the software sales are. Most games, (especially 3rd party) sell poorly on wii compared to say, Halo 3 on 360. But whats more important, hardcore gamers or casual gamers? Well ideally both. Nintendo focuses too much on the casual market. Xbox 360 is focused too much on the hardcore market. So guess who has the happy medium? The PlayStation 3. So whats more important, hardware or software sales? Hardware, if you want to win a console war. And that's why the Xbox 360 will fail. Again.

[karlostomy]

I must disagree.

The attach rate is the single most important factor for profitability for the console makers.

The attach rate, in case you are not clear on this, is the number of games which is sold per console on average. The 360 attach rate is 6.9 at the moment. That means for EVERY 360 console in the world 6.9 games have been sold. This is simply astounding.
Of course selling MORE consoles is also better, but not necessary for profitability. Let me give you a couple of examples:

example 1:
xbox 360 sells 80 million consoles over its lifecycle with an attach rate of 2.
80mill x 2 games = 160 million games sold

example 2:
xbox 360 sells 50 million consoles over its lifecycle with an attach rate of 6.9.
50mill x 6.9 games = 345 million games sold.

So you see from the above that even with a lower number of consoles sold overall in example 2, the higher attach rate sells more games overall than example 1.
Of course higher game sales translate into higher console profits. I think we all know that by now.

I hope that explains why the high attach rate is SO important.

---------------------
edit:
Hey Shadow.
Certainly you are free to disagree.
If you are right... kudos to you.

I am not certain, however, that the console 'war' will play out like it did last gen. Too many variables have shifted and subtle industry changes have occurred.
In a given situation, I will always place more importance on 'what is' than what 'I think might be in the future'. As such attach rates are the only measurable yardstick we have, apart from console sales, which neither I, nor anyone else, can predict 1-2 years from now.
just my 2cents
peace.

[Shadow Flare]

I know what you're saying but i disagree. I know what attach rates are, and attach rates are absolutely meaningless in the whole console war. Attach rates are incredibly important to profitability (which ironically enough microsoft hasn't seen at all from its xbox division since xbox 1), but its hardware sales that win the console war, not the amount of games sold. And it goes hand in hand anyway, more consoles sold, more games sold. The attach rate may never be high but more and more games are sold. The problem with the 360 is, its a hardcore gamers consoles. So lots of games will sell well, but its gonna hit its peak in hardware sales fairly soon, just like the xbox 1 did. And if that happens, then nothing else matters, because it lost. While Sony and Nintendo will still be laughing their way to the finish line because they are the ones still selling consoles and still getting game sales 5 years down the line

Nintendo actually made alot of profit with gamecube. But can you call the gamecube a success? Maybe Nintendo could, but Joe public would say its a piece of crap. Thats what i feel is important anyway

[HarryEtTubMan]

Attache rates are subject to change and WILL change. Its a brand new console. 2008 is seeing ALOT of great games come out. Just like Sofware sales are good(Worldwide) for how consoles are sold. Last week the PS3 sold 900,000 pieces of Software and the 360 sold not even 1,500,000...thinhk about it... thats more that half...PS3 software attache rates arent as bad as the Wii LOL and only about 1 1/2 games behind the 360...maybe 2. It will change. You are comparing a system with Bioshock Halo, Mass Effect, andGear of War to a system that will be getting ALOT in 2008. And even more really really good games in 2009. It really will change.

[THAMMER1]

M$ is not SONY. So that means that no matter how much they sell they are the under dog. For the past two years the 360 has totaly dominated software sales. The numbers do not lie.

You do not have to be the most popular to be the most profitable. Just look at things this way.

How relevant is the PS3 as a games console to the actual current video games market? Currently the biggest merit the PS3 has earned is helping Blu Ray to penetrate the market, which is O.K. with me. If I have to buy a Blu Ray player to watch HD movies why not buy a PS3?

How many developers have tuned profits on games produced for the PS3? Games are not selling for the PS3 like they are for the 360 bottom line.

The games should be at the harts of the console. As a gamer if makes me shutter when I hear people say they are buying PS3's for the blu Ray feature and could care less about the games. The PS2 is still a beast and sell great but when it comes to software sells it is still weak.

All I have to say is SONY's PS3 really is Blu Ray machine with Games as a secondary feature. Which is cool with me because I like the best of movies and games that is why u have a 360 and once SONY drops the price to what I see as a decent price for a DVD player I'll "Watch Beyond". Oh and get ready PS3 boys because once I get my PS3 I'll be on that @ss.

XBOX360 owns games

PS3 owns movies

Do not act like this is not true.

[Shadow Flare]

But you cannot honestly believe that ps3 being out half the time of the 360, with half the install base will beat it in software sales, also considering the 360 is majorly hardcore crowd who will buy, buy, buy games. I mean look at Japan, 360 has the highest attach rate there too. What does it account to? Absolutely nothing. Bluray's a big proponent of ps3, but playstation will always be a gaming console first. People buy a ps3 to play games formost. Just dont compare software sales to the 360 because they have a major hardcore following, like the xbox 1 did and they will always, always buy more games

[HarryEtTubMan]

Bro the only reason they have higher attache rates is because it was here first... and thats the only reason. PS3 hasnt released the games that REALLY sale well... ya know having FF13, MGS4, KILLZONE 2, Little Big Planet, Socom, Resistance 2, GTA 4 , Devil May Cry and more is gonna effect the PS3's attache rate. You want to live in LA LA Lang. Yea people like Sony more. Get over it. They came out a whole year later... its still brand new... and its been winning since October and now in 2008. Attache rates will change. And already have since the beginning of 2008. Attache rates change when the big games get here. There is no Halo or Gear or Biochock or 2 years of buying yet. But it is coming. Things will change. Stop being all grouchy because Sony is PWNING Microsft. I didnt buy my PS3 for movies... I did for games as did 99.9999 percent of PS3 owners.

Last week software sells: Ps3 almost(and literally almost 900,000 pieces sold

360has almost 1,500,000 sold.

Lets think. To only have a little more than half of the 360's user base. and sale more than half in software is NOT BAD. Sony is on their own schedule. Alot of people knew they didnt have that many games at first and didnt buyt. People are still waiting everywhere because they know the system will be out forever. Price will drop. All the huge games are coming. Playstation is synamous with console gaming and they will prove it again. PS3 is gonna take off in not too long. Its still a little expenisve. It is coming. Software is selling good for the amount of userbase.

Stop getting ur *sniff sniff* feelings hurt but the only Xbo 360 news is crappy news and its been all good PS3 news... YOU KNEW this was gonna happen... why cry now?

[THAMMER1]

Dude I am a hard core gamer. I helped the 360 earn that attach rate and become a profitable for M$.

At the end of the day I do not game for M$ or for sales numbers nor do I have anything to prove. The games is why I do what I do. From the looks of things you have a different opinion of what it means to be a gamer.

The hardcore market is the most important market to have. The hard core validate your products. Hard core gamers have validated the 360 and the hard core movie enthusiasts have validated the PS3.

Live by your reputation and die buy it too. Right now the PS3 is become popular due to Blu Ray not games. If your a gamer this must mean some thing to you. i ama gamer and a proud owner of the XBOX360. Once the PS3 is a the proper price for a "DVD PLAYER" I will pick one and be proud of that too.

SHADOWFART what are you? A gamer or a PLAYSTATIONITE?

[Shadow Flare]

Im a playstation fan. You're obviously just an asshole. I responded to your comment in a reasonable way. Whats with all the ShadowFart crap? Shadow...fart. *Clap clap clap*. You're a freaking genius

Let me tell you something straight. The hardcore market is important for 2 things in the world of games consoles:

-Establishing the system and getting the userbase at the start
-Buying the software

The casual market is what makes console succeed.

If you're nonsensical ramblings were true, xbox 1 would have beat everything last generation. Its that simple. It even had 2 Halo games. But guess what, in 1 year the wii has ousold Xbox 360. Mmmm. Casual market? I think the casual market is important actually, Microsoft doesn't seem to understand that....thammer

[Topshelfcheese]

What a joke, if he is really trying to compare xbox360 to PS2 thats just sad, the only system that has a chance to sell as many as the PS2 is the Wii.
I own all the systems, and I love them all, but for some reason this generation of gamers aren't buying systems nearly as fast as past generation, and I believe the times of selling over 100million of any one system is gone.

[Zhuk]

This is a great interview with Robbie and I thoroughly enjoyed reading it, he's such a visionary and a great leader for the Entertainment and Devices division, the products that are being developed by his division will undoubtedly change the world.

Here's some of my personal favourite quote from the article:

"Today, 17.7 million Xbox 360s have sold, three times more than PlayStation 3, with 6.9 games being sold after console purchase -- what the industry calls an "attach rate."

There's the true facts, Xbox 360 has outsold the PS3 3.1 and has a historically high and unrivalled attach rate. With these successes undoubtedly continuing throughout 2008, the Xbox 360 is in an excellent position to keep decimating the PS3

[Shadow Flare]

Good lord, is that actually what he said? Xbox 360 has outsold ps3 3:1? 17.7 million is the shipping numbers here are the actual sold numbers:

Xbox 360 - 16.33 million
PS3 - 8.96 million

That's less then a 2:1 ratio, not 3:1

3:1....that's not even spinning the info, thats just an outright lie. But when you see Xbox 360 sales slowing, who wouldn't resort to that?

[bootsielon]

360 decimating PS3 is a flat out lie. 360 actually sold less than they did last year, even though they had a price drop, Halo 3, Bioshock and Mass Effect. PS3 on the other hand has outsold 360 for the last few months; the only place where 360 is beating PS3 is the USA. Everywhere esle 360 is dead (How is it that an Aussie like you became a 360 sheep I don't know)

Last year was PS3s worst year. This year 360 HAS to drop the price , but it won't go below 299.99 on the premium, and it wont go below 249.99 on the Arcade, that's almost warranted, since MSFT doesn't want to bleed anymore money.

The games that are coming for Xbox 360 may be "undoubtedly AAA", but they won't sell consoles, no sir; only GTA4, but again that is on PS3, which will have many killer apps that 360 lemmings like you wish they had (of course you'll deny it and say MGS sucks, like all xbots).

[klashawnd]

And the fact is the XBOX 360 has only sold TWICE as many systems as the PS3. Thats's a 2:1 ratio not 3 to 1. The fact that the 360 sold close to 20% LESS consoles this year compared to last year, even with heavy hitters like Halo 3, Bioshock, and Mass Effect all dropping last year... doesn't bode well for the future prospects of the system this year. Gears of War 2 alone will not cut it.

[Account deleted]

"Z BOT", even if i don't agree with you, at least i have some respect for you, your posts are well written with no offensive content... now you need to start working on some of your logic.. i mean really, is m$ going to change the industry? revolutionize? i think this is against their standards for example they release at least 8 versions of their software each time with a small change, how do you expect a company with these moneysucking standards(i am not saying others aren't, but m$ is the biggest) to make innovation? they will merely make a copy with some new bells and whistles, and that's it... as for sony, have a look, they expanded the industry introduced new genres like singstar, buzz,etc... nintendo, well they have some ideas, the wiimote is a good one but why did they have to make a gamecube 1.2(at most) with a motionmote, they could have made a more capable hardware... myself i am not attracted to wiimote concept, i like better a normal controller, it is much more better...and maybe now i will hear someone saying the wii have revolutionized things with games like metroid prime and the wiimote blablablala... i say that the guncon peripheral is much more better.. anyway i strayed from the main subject... that's funny an xbot DOWN UNDER

[VanDamme]

I heard a true fact the other day. I heard that 2 girls 1 cup was inspired by a home movie Zhuk made. I heard Zhuk has no friends--so he had to use video editing software to clone himself. I guess he got a bad case of crabs on his mustache afterwards.

[THAMMER1]

The 360 is the under dog 100%

It has made it mark and will continue. Playstation is the top dog and has been for years. So why do PS fans act so nuts? If the PS3 is so great why do you have to prove it for us it should do that on its own. The """Hard Core VIDEO GAMES COMMUNITY""" would jump on it and validate it. So far only movie buffs have jumped on.

So for now the PS3 is Blu RAY the 360 "IS" GAMES.

[Maddens Raiders]

I didn't disagree w/ you, but I do disagree w/ you that only people have jumped on for movies. Are you saying that Incognito, Naughty Dog, Insomniac, Guerilla, Ninja Theory, Kojima, Square Enix, NCSoft, and Infinity Ward, and even...wait for it....EA jumped on and are counting praises of the PS3 for movies? Come on hammer even you have to admit that the PS3 is looking and is indeed quite formidibale at this juncture.

I understand your undying and deep, deep allegiance to the "underdog", but in the longrun where is that going to leave you, doc?

[AceLuby]

After the 360 gets to the 25-35 Million consoles sold range. If the 360 can keep the pace they have set kudos to them, but their last console saturated the market at that point as the PS2 sold over 4 times as many. A simple reason that gets overlooked (besides how cheap it became) was that it was a game machine AND had a built in DVD player. It was great for the bedroom and many friends of mine got one once it was cheap just to have both options in their room. The PS3 can do the same w/ the blu ray player, but will it? Only time will tell, but it is already selling across markets and that only gets more HW sold. Both will get great exclusives (the xbox exclusives were great too!), but IMO, the PS3 has what it takes to sell far more consoles than the 360. Getting across markets is key, as shown by the PS2, so the 360 will need to find a way to get an avg consumer (not a gamer) to buy their product over the PS3, w/ far less features.