Microsoft has lost billions of dollars on Xbox division, no turnaround in sight

[Trippy]

[EDIT] This is in no way meant to be a retraction on that apology, but my basic point was that it seemed like the XBox brand undercuts Microsoft's overall bottom line more than the PS3 does for Sony. That Microsoft's other products have enough expenses of their own to take of, while Sony's other products have a better trickling down effect.

Anyways, I'll drop it. It's gotten more convoluted than I thought at first.

No it doesn't. Using today's Yen to Dollar conversion rate, Sony had revenues of around US$63 billion for FY 2006 with an operating income of US$1.6 billion. That's a piddly 2.6% operating profit margin. Their largest division by far, Electronics, is actually losing money for Sony. Their Games division had revenues of $8 billion and operating income of $73 million. Sony's also currently sitting on $2.2 billion in cash.

In comparison MS for FY 2006 had revenues of $44 billion but $16.4 billion in operating income for a staggering 37% operating profit margin (it's good to be a monopoly). Their Home and Entertainment division with includes the Xbox stuff (they don't break it out separately) had revenues of $4.2 billion and a loss of $1.3 billion. Microsoft has $34 billion in cash.

In other words MS, despite having less revenue than Sony is making an order of magnitude more profit than Sony and they have an order of magnitude more cash than Sony. Their H&E division would have to be losing $15 billion a year for MS to drop down to the same profit margin that Sony is currently running at. To put that into perspective they could *give away* 30 million Xbox 360s a year and still be making more profit than Sony.

Edit: actually it's a lot more than 30 million since I forget that distributors and retailers take a cut of that $399 retail price (i.e. the full $399 doesn't show up as revenue for MS).

[stray]

OK, I appreciate the work, Trippy.

I want a free 360 now.

[Ragnoros]

Man I would Kill for parasite eve on 360.

[schild]

I like the new guy.

[squirrel]

OK, I appreciate the work, Trippy.

I want a free 360 now.

It'll ship when my free PS3 from your profitable Sony arrives :P

EDIT: Which without any sarcasm will likely be in August or so as that's when I'll buy a PS3. Sorry Stray, doubt we can ship you a frree 360 tho.

[stray]

Eh, I know I'll end up getting one by the time Forza 2 rolls out. Just biding my time here. 


I'm starting to get a little gloomy about both machines though. When people start praising Dewey's Adventure, I get gloomy. The Wii looks to be kicking ass for the forseeable future because of stuff like that. If it can somehow win hearts from that kind of tripe (even before being released), then I fear what happens after 2007, after developers have moved more A teams on to Wii projects and actually crank out a decent game or two. Further, if they start making mad cash from those decent games, then it'll just mean less teams working on and more gaps between quality titles on the 360 and PS3.

I just hope there aren't enough gaps as to make those systems collect dust in between whatever good games they do get. If that remains the case, then purchasing the hardware won't feel like a waste.

[squirrel]

Eh, I know I'll end up getting one by the time Forza 2 rolls out.

Ok. At least I know you're sane. Cause F2 is gonna be it. You know. IT.

[schild]

imsorrybutlostplanetanddeadrisingarealreadyout.

[stray]

Like I said, just biding my time. I've had a lot on my plate since January. Nothing to snub the 360 specifically. :)

Unfortunately, when I do get it, I'm gonna have to play catch up. That's a lot of games.

[EDIT] Unintentional funny. Here I was a minute ago complaining about a possible lack of future games.

Now I'm bitching about having to get too many games.

[Yegolev]

Man I would Kill for parasite eve on 360.

I think you just dodged 90% of the new-guy hazing.

EDIT: Dead Rising is awesome.  Also, I'm going to try to get my 360 online this weekend and join the rest of the gaming world.

[stray]

That was the game with the cutscenes right?


Seriously though, it wasn't one of my favorites.

[Yegolev]

What?  Mall full of zombies, large variety of weapons... it has some cutscences but they are skippable.  It's also hard, by which I mean Capcom Hard.

[stray]

i meant Parasite Eve. I've barely played Dead Rising. 

[EDIT]

Me = Capcom fanboi. I do want Dead Rising and Lost Planet. They just happen to be on a system I don't have yet.

[schild]

Parasite Eve was chock full of cutscenes.

Weird thing about Lost Planet vs Dead Rising. Yea, Dead Rising was hard. Lost Planet though? Fucking cakewalk. I'm not sure what Mikami was up to.

[Nija]

Eh, I know I'll end up getting one by the time Forza 2 rolls out.

Ok. At least I know you're sane. Cause F2 is gonna be it. You know. IT.

I/you/Stray/we can't stress this enough.

[NiX]

And Bushido Blade.

I really wish they would just remake the first one for next-gen, but it won't happen. Guess I'll have to ebay the original and take the hit.

[Simond]

Going back to the Squeenix thing, anyone else read this?

Huge news today in Japan as Square Enix announced it reformed business model, and a significant rise in the likelihood of a Final Fantasy VII remake.

Late Wednesday night, on their Japanese web site, Square Enix announced that it will be working under a new business model, focused more on re-releasing existing titles and creating sequels to older games.

This change is no doubt due to the overwhelming success of its latest projects, which have all be remakes of Final Fantasy games for the Nintendo DS and Game Boy Advance platforms. These remakes have done surprisingly well and have prompted Square Enix to look into the remade games further and for other systems as well. As a result, the company has decided that remakes and sequels will do well enough to keep the company in the green for quite some time.

This news will no doubt start an uproar in Final Fantasy VII remake rumors that have slowly lost their credibility since E3 of 2005. But even more exciting news to some is the possibility of other Square Enix franchises being dug up from the grave and re-released on next gen platforms.

A FFVII remake for the 360 would be nice.

[schild]

Yea, RPG fan reported on it a while ago.

Honestly though, they need to remake FFVI on next-gen more than VII.

[Velorath]

Going back to the Squeenix thing, anyone else read this?

Huge news today in Japan as Square Enix announced it reformed business model, and a significant rise in the likelihood of a Final Fantasy VII remake.

Late Wednesday night, on their Japanese web site, Square Enix announced that it will be working under a new business model, focused more on re-releasing existing titles and creating sequels to older games.

This change is no doubt due to the overwhelming success of its latest projects, which have all be remakes of Final Fantasy games for the Nintendo DS and Game Boy Advance platforms. These remakes have done surprisingly well and have prompted Square Enix to look into the remade games further and for other systems as well. As a result, the company has decided that remakes and sequels will do well enough to keep the company in the green for quite some time.

This news will no doubt start an uproar in Final Fantasy VII remake rumors that have slowly lost their credibility since E3 of 2005. But even more exciting news to some is the possibility of other Square Enix franchises being dug up from the grave and re-released on next gen platforms.

A FFVII remake for the 360 would be nice.

The thing is, with the exception of the FF3 remake on the DS, all the GBA stuff has pretty much been ports of the old games with a few additions, while an FFVII remake would take a sizeable team.  I don't see it becoming any more likely just because Square realized they can make good money with little effort off of old ports.  I'd expect to see DS and PSP ports of Front Mission, Saga, Mana, and various PS1 games on the PSP, before we'll see a FFVII remake on a next-gen system.

[schild]

I wouldn't mind seeing Live A Live updated. Or Rudras, or G.

Really, they have a freaking treasure trove. And while I expect a bunch of shovelware at first, they wouldn't miss the chance to hit hard with a next-gen remake of 4, 6, or 7. They would be insane not to.

[Velorath]

I wouldn't mind seeing Live A Live updated. Or Rudras, or G.

Really, they have a freaking treasure trove. And while I expect a bunch of shovelware at first, they wouldn't miss the chance to hit hard with a next-gen remake of 4, 6, or 7. They would be insane not to.

They'd be better off waiting for more people to buy into the next-gen systems before they do.  As it is, they're already pouring a lot of money into their FFXIII stuff.  Pouring even more into those kind of remakes wouldn't be the best idea for them right now.

[schild]

I wouldn't mind seeing Live A Live updated. Or Rudras, or G.

Really, they have a freaking treasure trove. And while I expect a bunch of shovelware at first, they wouldn't miss the chance to hit hard with a next-gen remake of 4, 6, or 7. They would be insane not to.

They'd be better off waiting for more people to buy into the next-gen systems before they do.  As it is, they're already pouring a lot of money into their FFXIII stuff.  Pouring even more into those kind of remakes wouldn't be the best idea for them right now.

Square-Enix doesn't really need to wait for systems to sell. With the proper game, the company sells systems. If Sony doesn't court SE to make 6 or 7 next-gen, they're crazy. Mostly because Microsoft probably already is doing just that.

[stray]

If anything deserves a remake, it's Chrono Trigger/Cross and Bushido Blade.

But of course, I know it won't happen. FF will probably get preferential treatment. ON THE DS.

[schild]

As cute as FF3 was, they can't do that shit with SNES titles. FF3 DS looks worse than FF6 GBA. By far.

[Fabricated]

Man, I really hope Square doesn't start doing ports. Their games take long enough to develop as it is. We'll be senile by the time FF14 drops if they plan on releasing it to both the 360 and PS3.

That and it makes no sense for them in Japan since more people have a fucking Colecovision in Japan than a 360.

[stray]

As cute as FF3 was, they can't do that shit with SNES titles. FF3 DS looks worse than FF6 GBA. By far.

Either way, it's a million to two million sold on whichever one. In Japan alone. I doubt an Xbox 360 or PS3 would do that. They barely even have a million systems total and combined in Japan.

The Wii could do it maybe, but strangely, that's more heartbreaking to me than DS ports.


[EDIT] Oops. Fixed quote. ;)

[schild]

Fuck Japan, bunch of non-gamers. Square would be more successful making Chocobo Age - Brain Training for your Tiny Yellow Subservient Birds.

[Simond]

Man, I really hope Square doesn't start doing ports. Their games take long enough to develop as it is. We'll be senile by the time FF14 drops if they plan on releasing it to both the 360 and PS3.

That and it makes no sense for them in Japan since more people have a fucking Colecovision in Japan than a 360.

Amazingly enough, Square-Enix does sell games outside of Japan from time to time.

[stray]

It's just that they usually sell considerably more there. One could argue that they aren't really necessary, but it sure as hell doesn't hurt (in Square's eyes, that is).

For example,

FF XII
--------
JP:  2.42 Million
US: 1.68
Others: 840k