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Xbox Losses and the Next Generation
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Posted by: Kdr Kane
Beating Sony and Nintendo in the gaming console market is apparently worth billions to the software giant.
Microsoft executives are predicting heavy losses related to the Xbox video game console, but the company is prepared to keep supporting its central offensive against Sony and Nintendo by launching a version with new features next year...
One problem for Microsoft is that it projects that its costs for the Xbox will decline slowly. The cost of the box may come down over five years from $325 to $225, according to the source. By contrast, Sony and Nintendo are expected to bring their costs down more steeply over time, largely because their machines don't have an expensive hard drive.
Microsoft seems undeterred by the losses. Robbie Bach, the chief Xbox officer, said at the recent Electronic Entertainment Expo that Microsoft planned to spend $2 billion more on the Xbox over five years. To add features like digital video recording, the machine will need more costly components like TV tuners, extra memory chips, and a bigger hard disk. This combo box might launch next year for a price of $500. The product is controversial in part because it creates a conflict within the machine: will the game slow down so that the hard drive can record "BattleBots"? Balancing the needs of gamers and general users will not be easy.
Source: Red Herring Magazine
Posted by: redwench
heh. ms is obviously making the xbox a loss leader. theyll make up the profits on the games themselves.
Posted by: Nfested
Whoa, some big font there.
I'm not too fond of a console having the ability to digitally record video. The combo box is too expensive. Five-hundred dollars!?! That's too much.
Posted by: JANNA
i wouldnt buy a combo box like that since i dont find anything on TV worth recording to begin with. and IF there was i got a VCR that can handle that just fine. i think that doing that is barking up the wrong tree.
Posted by: Null Actor
That would rock!
I won't purchase a VCR, I don't see the point. If my xbox could record television though... that would be sweet!
Posted by: SKYHN
A waste if you ask me. The xbox isnt selling now just as a video game system at $299 now at $199. Why would a PVR and $500 spark sales?
I think its about time they gave up, they are getting desperate now.
Posted by: JANNA
how do u figure its not selling?? from what ive seen its doing quite well.
Posted by: SKYHN
Its in 3rd place. 4.5 million worldwide. PS2 is in first with around 33 million, GC is in 2nd with 6.5 million.
Its not selling well enough for them to add something like a PVR to it and then put a price tag of $500 on it. The Xbox will not be a console with a PVR in it.
Posted by: Shalome
 Quote:
Originally posted by SKYHN
The Xbox will not be a console with a PVR in it.
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I think that's the point. Microsoft is moving towards total media, personal computing, and home entertainment domination in the market. If you had something that worked like a TiVo, a VCR, a DVD player, and a game console -- all in one -- wouldn't it be worth $500?
Posted by: SKYHN
Gamers by a console for gaming, not for a PVR or DVD player.
Why do you think the Genesis, SNes or any other previous console didnt have a VCR, DVD Recorder or PVR built into it?
Posted by: TotalRecall
Microsoft is making a move to try and fill a niche of gamers who do want it all. Your posts are very biased, SKYHN.
Posted by: SKYHN
Fine, Ill see if I can get IGN or Gamespy to post a poll asking if you want a PVR in your console. Then we will see...
Posted by: Canis Lupus
any poll on it would be irrelevant... IGN or Gamespy does not represent a non-biased console gaming population... you yourself said the IGN forums are crap...
Besides, if "some" people buy the Xbox in its PVR incarnation, then that basically debunks the argument that no console gamer will buy a PVR...
Quote:
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I think its about time they gave up, they are getting desperate now.
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So your stance is basically to have Microsoft to stop making Xboxes? Why?
Posted by: SKYHN
Quote:
Originally posted by Canis Lupus
any poll on it would be irrelevant... IGN or Gamespy does not represent a non-biased entire console gaming population... you yourself said the IGN forums are crap...
Besides, if "some" people buy the Xbox in its PVR incarnation, then that basically debunks the argument that no console gamer will buy a PVR...
So your stance is basically to have Microsoft to stop making Xboxes? Why?
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They dont have to stop making them, they just need to stop coming up with some "hybrid" crap that they keep doing. It looks to me like they are trying to eliminate PC gaming, if they end up bringing out that home entertainment hub that they sent out for that survey. I wouldnt be surprised if the next version of windows was designed so games could not be played.
You are telling me that a 16 year old kid/his parents who want an Xbox is gonna pay $500 for it because it comes with a PVR? I dont think so. I know 2 people people with a PVR, my 70 year old Grandparents. With VCR and DVD Recorders out there, there is not much demand for them. Especially when PVR's out now only have a maximum of 60 hours(the more expensive ones have 60, the middle range priced ones have about 30 or 40) and its not permanent. To make it permanent, you need another recording device, such as a VCR or DVD Recorder.
We will see what happens when the developers, who warned MS months and months ago about what MS is doing with the Xbox, stop supporting them. Or perhaps MS doesnt take them seriously enough? Without developers, you have nothing but a box of circuits.
I suppose they will be putting this out in japan as well?
Posted by: Null Actor
Hybrid devices are the way of the future dude. And MS is putting their money in it, because of that.
Perhaps selling an xbox with a PVR isn't all that great of an idea...
However, selling PVRs that play xbox games, is a trump card.
Posted by: Ion Silverbolt
Quote:
Originally posted by SKYHN
A waste if you ask me. The xbox isnt selling now just as a video game system at $299 now at $199. Why would a PVR and $500 spark sales?
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I agree with Skyhn. Parents and even most gamers aren't going to chuck out that kind of change just to have all of that. Hell you can assemble a PC that does all that for not much more. And my 65$ TV Tuner card records TV programs.
If MS is going to make it in the Console market, they bettered stick to consoles. And maybe even start publishing for more game developers so they can actually get a respectable amount of games for the system.
Posted by: Shalome
Okay, look at it this way:
It's not a console they'll be making. It will not be marketed as a gaming console. Gamers will not be the primary target.
It's a hybrid entertainment unit. It records video. It plays DVDs. It plays CDs. It plays games. It only costs $500. Try finding a DVD player, a CD player, a high-end game console, and a VCR/PVR in seperate components for under $500.
If it worked well, I'd buy one.  Hell, you should see the mess of wires we've got hooking up our PS2, stereo, CD player, DVD player, VCR, etc. It's a freakin' nightmare. If it was all in one box, that'd be a lot simpler.
Posted by: Ion Silverbolt
It does sound cool don't get me wrong. But all that in one will only appeal to specific people who want all of that.
And what do you do if you want to take your console to a friends but also want to tape a show while you're gone? 
Posted by: Swilo
I'd say more than 99% of people who own TVs also own a VCR. The Xbox is already a DVD player/CD player/gaming machine.
If you've already got a TV, an Xbox, and a VCR, what's the real point in spending another $500 for the upgraded one?
Posted by: Chako
The real point is several fold.
1) Making things smaller is always a good thing. I know many people, myself included, who have bought newer electronics just for the space saving factor alone.
2) Savings. Shalome is right, buying all of that would be more expensive then buying one of these.
3) The proverbial Swiss army knife syndrome. Many people like gadgets that can do lots of things. You may not need it all, but many like to have it all.
4) Elimination of the rats nest of cables. I don't know about you, but I am with Shalome with this. The back of my stereo system has more plug ins then you can shake a stick at. My surround sound system is even worse. Throw in 2 VCRS, a TV, a DVD player, etc...and you can see how simpler is better.
5) Maybe this new device will offer new features that only integration can offer.
Skyhn, do you remember the Sony Walkman? Here was a device that nobody could conceive working. The top execs at Sony did not think that anyone would want to listen to music on the go. Someone took a chance, and thus began a trend that changed many lifestyles right up to today. I remember the first walkman..they where expensive..and yet people still bought them. So, with this thought in mind, I haven't a clue why your so against it. IF it fails, then MS takes its sugar with those lumps. If it blooms...why...that is just the march of technology.
Posted by: JANNA
less see xbox has sold 3.3 million if i use ur figures in a little less than 6 months or so. sony didnt do have as good with its launch of the PS2 u CANNOT compare nearly 3 years of sales to 6 months of sales.
Posted by: Kdr Kane
When it comes time for it's release, Microsoft must have two versions of the Xbox.
Here's the rational.
They are trying to be competitive with the GameCube and PS2. So the current version of the Xbox will have some longevity. It won't be replaced by the new Xbox.
The new Xbox will be called some stupid name like Xbox XP. It'll have all that extra crap on it. It'll be good for those single folks out there and those kids that have their own TV and VCR's in their bedroom.
Those of us that live on a budget, usually buy our electronic components separately. It makes it easier to mix and match. We won't usually be buying an Xbox XP. We'll probably buy a GameCube when it comes down to it. 
Posted by: Xtren
Success for the Xbox at last
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