Microsoft made a gaming box that didn’t game well, banked on controlling the content gateway with an expensive peripheral that customers despised and resented paying for, and wondered why it didn’t sell.
While that’s true about Microsoft with the Xbox (and even Sony with the Playstation — a company that originally wanted to partner with Nintendo), the smartphone business is very different.
Thanks to apps, content, and things like iMessage, there is decidedly more lock-in in mobile. Yes, the video game consoles have some lock-in with their games, but because the business changed so much generation to generation (with mixed backward compatibility results), there were obvious “switch points”. That’s not quite the same with mobile.
More importantly, Microsoft (and Sony) could get into the gaming business because they could buy their way in with the large publishers of games. So far, that hasn’t worked for Microsoft with smaller app developers. While money is money, time is often more valuable to these small teams. And they’re not going to waste time on a platform with relatively few users.
A couple things here:
1) I have no doubt that those hardcore games will remain a big deal and a good business. But I think more casual games, with the right hardware mixed in, could eventually be a bigger business.
2) You look at the Apple TV right now and you see a piece of hardware that can’t match the Xbox. But how far away is it really? I can now play the same Grand Theft Auto III that I used to play on my Xbox on my iPad/iPhone. The Apple TV runs on the same stack (even if you can’t see it yet). And, like those devices, the hardware is on a yearly refresh cycle — not the 5-to-10 year refresh cycle of gaming consoles (which is ridiculous and not tenable going forward).
So let’s revisit this comment in a couple years, shall we?
True, but again, Xbox was a new product in a new division that did not cannibalize other divisions. Surface will cannibalize the Windows division.
That’s a division that brought in $2.4 billion in profit last quarter and $11.5 billion for the year. BTW, the Entertainment and Devices Division (which is essentially all Xbox being offset by Windows Phone)? It still *lost* $263 million last quarter.
Oh, right. Fucking “360” name threw me off :)
I do wonder what they’ll call this one. I assume the last time it was “Xbox 360” because they didn’t want to be “Xbox 2” going against “Playstation 3”.
This time I wouldn’t be surprised if they scrap numbers altogether and go with something to convey more Kinect-like stuff. That, or something esoteric that no one will get besides six people in Redmond.
Or, Xbox Live Windows SkyDrive 7 Media Series Box. Home Edition.