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[P]
Will The X-Box Be Profitable?

By Carnage4Life in Op-Ed
Thu Feb 01, 2001 at 12:13:42 AM EST
Tags: Technology (all tags)
Technology

After Sega's recent announcement that they would slash Dreamcast prices to get rid of piled up inventory and will stop producing consoles, owing to the fact that they have been losing several hundred million dollars a quarter selling consoles for the past few years, I now wonder about the long term viability of Microsoft's X-box.


Price Wars

The main problem I see with the profitability of Microsoft's X-box is that it is entering a market where being a loss leader is standard practice and all manufacturers sell their wares at prices below cost to gain market share. To compete with the offerings from Nintendo and Sony the X-box will have to be priced between $150 - $300 to be competitive which doesn't leave much room to recoup investments.

As Sega has learned after losing over $1 billion dollars over the past 4 years this is the fastest way to become a money hemorrhaging business. From observation, the console market seems to be able to only support one major player be it Nintendo in the late 80s or Sony in the late 90s. For Microsoft to be successful in the console market it has to displace both Nintendo and Sony in Asian, American and European markets which considering the degree of brand recognition these companies have attained will be difficult.

Online Potential and the .NET platform

Many gaming pundits point to the X-box's bringing online gaming to the masses but fail to acknowledge that until broadband becomes more widespread, this market will not be sizable. Also the X-box will have to compete with a deeply entrenched PC gaming market for the online gamer.

More interesting are the suppositions that are often made on Slashdot that the X-box is some sort of plot that Microsoft plans to use to sneak a Microsoft Internet Appliance into the home and have another way to spread .NET around the world. Frankly I don't buy this argument and from observations of the relatively low subscription rates for WebTV as well as SegaNet, it is unlikely that people are eager to use a game console + television as a doorway to the Internet.

On the other hand, the inclusion of a hard drive with the X-Box does make it more attractive as an Internet Appliance than the Dreamcast or WebTV.

Games Licensing

The potential money maker for Microsoft with regards to the X-box is games. Sony and Nintendo have managed to stay ahead of the game either by having extremely successful games (Pokèman for Nintendo) or making sure they get a decent piece of the action from games sold on their platform via licensing fees.

Microsoft is trying to score big in the games arena by buying Bungie Software and making sure their much anticipated games become X-Box only releases. But that is just a start; with the proliferation of exclusive licensing contracts it is possible that the X-Box will have to fight to get some of the premiere developers to work on its platform: although the list of current X-box developers is rather large and contains a few big names (e.g. Namco, iD, Eidos, Konami, etc), there are a few good companies that are notoriously absent such as Electronic Arts.

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Poll
Which is your favorite console?
o Super Nintendo 14%
o Playstation 12%
o Dreamcast 22%
o Nintendo (8-bit) 19%
o Playstation 2 5%
o Sega Megadrive (Genesis) 11%
o Neo Geo 9%
o X-box 5%

Votes: 77
Results | Other Polls

Related Links
o Slashdot
o slash Dreamcast prices to get rid of piled up inventory
o stop producing consoles
o Slashdot [2]
o SegaNet
o Bungie Software
o list of current X-box developers
o Also by Carnage4Life


Display: Sort:
Will The X-Box Be Profitable? | 48 comments (42 topical, 6 editorial, 0 hidden)
Microsoft has cash (4.00 / 4) (#2)
by babylago on Wed Jan 31, 2001 at 05:49:53 PM EST

They can throw money at mindshare, which is what they are doing with X-Box. The likelihood is that they will make money on the software and services part of it because they are very, very good at making money, but I think the real point of the X-Box is to keep Microsoft foremost in the minds of the greater number of consumers, who will then, when confronted with a purchasing decision, select the Microsoft product.

<troll>
I suspect that the tobacco industry's personnel cutbacks have resulted in their marketing departments moving to Microsoft and instituting the "Hook 'Em While They're Young and Impressionable" approach to brand management.
</troll>

---
[ Blog | Hunnh ]

monopoly... (4.60 / 5) (#7)
by _Quinn on Wed Jan 31, 2001 at 08:37:41 PM EST

   I thought that Microsoft's approach was pretty clear. They have several billion in (monopoly-generated) cash to throw away, and throwing it away into the xbox does several things. First, they could undersell Sony (or Nintendo; add that to all references to Sony from here on out if you wish, but I think Sony's the real target, as I'll explain later) on the hardware. They /are/ underselling Sony on the software/licensing side of things; the development kits are substantially cheaper. (Sorry, I don't have a link.) So what are they planning to do?

   It's classic, actually: undercut a competitor in an area in which you don't have a monopoly by feeding money in from the monopoly. If you can drive your competitors out of business, you've generated another monopoly, and it's time to jack up the prices and make a killing. Microsoft has killed off (or weakened and then bought) many companies by integrating previously pay-to-play features into the OS. (Compression (Stak), built-in TCP/IP (Trumpet), browsing (Netscape), etc.)

   In addition to trying to generate a new revenue stream, the xbox can act to protect potential revenue streams. For instance, MS missed the boat on the web, pretty much, and had to buy a raft (from Spyglass) and spent a lot of time and money trying to convert it into a cruise ship while fighting the current and trying not to fall too far behind the speedboat (Netscape), which responded by trying to turn into a luxury yacht and disintegrating. Broadband to the home isn't big right now, but it very well could be -- and xbox is another way in. Sony is going to be pushing A/V integration with the PS2 heavily; why else spend the money on the FireWire jacks? There's a market Microsoft isn't really in yet. (Expect to see WebTV/xbox cross-marketing, BTW.) Convergence in general will be a good way to make money, so MS wants to get themselves associated with consumer electronics as well as computers. And so on.

   In summary: it's a move with two potential wins: first, the potential to develop another monopoly; second, it inserts Microsoft into a market that could become very big. There a lot of smart people at Microsoft, so I'd be suprised if they didn't at least /see/ most of the boats coming downstream. Some of them they won't pursue, or for corporate reasons, won't be able to pursue, but I'd be astounded if they missed a market after a behemoth like Sony pushes it.

-_Quinn
Reality Maintenance Group, Silver City Construction Co., Ltd.
Nintendo et al (4.50 / 2) (#16)
by codemonkey_uk on Thu Feb 01, 2001 at 08:30:12 AM EST

Microsoft will be hard pushed to gain a monopoly position in the games console market.

Nintendo are massive, and while they may not be in lime light now, they are still hugly profitable, and, having seen a GameCube demo, I can say that they have some awsome hardware in the pipeline.

The other important point is that the games console market does not have the "lock-in" that the (application orientated) PC market does, though its obviosly a consideration for Sony, who added PS compatability to the PS2 (an industry first).

Finnaly, as Sony demonstrated, anyone with the money can buy into the market. This is one area that MS can not control (for any significant amount of time).

In conclusion, whatever Microsofts plans for the XBox are, they do not revolve around monopoly control off the games console industry as we know it.
---
Thad
"The most savage controversies are those about matters as to which there is no good evidence either way." - Bertrand Russell
[ Parent ]

Interesting thought - case color (4.25 / 8) (#8)
by fluffy grue on Wed Jan 31, 2001 at 09:16:19 PM EST

Someone over at Planet Dreamcast (BenT, I believe) made an interesting observation about consoles which succeed and fail - namely that every black gaming console has been a failure.

Sega Master System? Failed to NES. Genesis? Failed to SNES. Saturn? A miserable failure in America, but in Japan (where its case was grey) it was a huge success. Even non-Sega consoles follow this trend - Turbo Grafix 16? Failed to NES. Nintendo 64? Failed to Playstation - until the multi-colored "Funtastic" series came out.

I'd like to point out that X-Box's case is black.
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]

Note to self: buy a grey console next time (3.00 / 2) (#10)
by Phaser777 on Wed Jan 31, 2001 at 10:22:32 PM EST

Interesting observation of the case color. All my consoles are black, so I guess that shows how well I can predict video game markets. :)
---
My business plan:
Obtain the patents for something (the more obvious and general the better)
Wait until someone else adopts the idea and becomes rich off it.
Sue them.
Repeat.
[ Parent ]
Dreamcast? (2.50 / 2) (#11)
by interiot on Wed Jan 31, 2001 at 10:50:00 PM EST

Well, the Dreamcast is about as far from black as possible, yet it failed. (unless you don't consider halting hardware production when PS2 is failing for the next couple months at least, and XBox is still a ways off... failing).

[ Parent ]
Uhhh... what? (4.00 / 2) (#12)
by fluffy grue on Thu Feb 01, 2001 at 02:28:20 AM EST

When did I say that ONLY black consoles failed? Just that all black consoles failed. Also, I'd hardly consider Dreamcast a failure - not yet. Just because the mainstream Dreamcast line is being terminated doesn't mean it's not going to live on; after all, Sega's getting Dreamcast technology put into a lot of other systems right now, and they're still making games for it.
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

The Paddies loved Sega! (3.50 / 2) (#13)
by Sneakums on Thu Feb 01, 2001 at 05:19:46 AM EST

Genesis? Failed to SNES.

In Ireland, the Sega MegaDrive (as the Genesis was named) was a roaring success, and the SuperNES did very badly. Pretty much every game was available for rental as soon as it was released, as were the consoles themselves.

The Sony PlayStation has been a repeat of the Sega story; Nintendo's N64 does some rental business, but not as much as the PS.

[ Parent ]

Overall failure (none / 0) (#25)
by fluffy grue on Fri Feb 02, 2001 at 01:04:13 PM EST

No offense, but Ireland isn't exactly a make-or-break market for the console gaming industry. :)
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

Ah, but... (3.00 / 2) (#15)
by Yer Mom on Thu Feb 01, 2001 at 07:51:52 AM EST

The Atari 2600 was black. Apart from the woodgrain bits, of course.
--
Smoke crack. Worship Satan. Admin Unix.
[ Parent ]
Which 2600? (none / 0) (#26)
by fluffy grue on Fri Feb 02, 2001 at 01:06:59 PM EST

Weren't there, like, 10 billion different releases of the VGS/2600? The one I'm most familiar with was black with a silver top (I might be thinking of the 7800 though). Also, whether the Atari 2600 could be considered a success or not is a debatable point...

Oh, which reminds me of a console I overlooked: the Jaguar. Which was also black. :)
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

PS2 (4.00 / 2) (#17)
by codemonkey_uk on Thu Feb 01, 2001 at 08:33:54 AM EST

Colour ... black as the night.

Future ... unknown, for now.
---
Thad
"The most savage controversies are those about matters as to which there is no good evidence either way." - Bertrand Russell
[ Parent ]

Black? (none / 0) (#24)
by fluffy grue on Fri Feb 02, 2001 at 01:02:47 PM EST

I thought it was dark blue...
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

Nice idea... (none / 0) (#19)
by inpHilltr8r on Thu Feb 01, 2001 at 04:07:49 PM EST

...except the N64 is brown. But then you can hardly call figures like these failure.

[ Parent ]
WTF? (none / 0) (#23)
by fluffy grue on Fri Feb 02, 2001 at 01:01:54 PM EST

  • I have an N64. It is black.
  • I specifically said that the N64 was a failure until they came out with the colored cases.

--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

Huh? (none / 0) (#29)
by inpHilltr8r on Sat Feb 03, 2001 at 07:33:18 PM EST

Well. now I'm confused, I mean, I have a first gen american N64, and it's most definately brown. The underbelly is black, but the bulk of the casing is most definately brown, well, brownish gray, but in no way black, and in no-way, fun-tastic. That said, I think I've seen a black one, once, but only because we used have every console under the sun at work.

But if you want to get picky, the N64 was a success in japan from day one, and the Megadrive was a rip-roaring success in europe, where the SNES was too expensive, and too late.


[ Parent ]
Could be perceptive things (none / 0) (#31)
by fluffy grue on Sat Feb 03, 2001 at 11:35:37 PM EST

There are some rather ambiguous plastic colors out there which some people see differently from others. For example, to me, Commodore 64s look brown, whereas to other people they look gray. However, everyone I know thinks that the N64 is black, myself included, so... :) You're the first to claim it's brown, in any case. And the "fun-tastic" line was the colored cases which were released about a year ago (watermelon, berry, lime, etc.)

I didn't know it was considered a success in Japan. I was under the impression that it did relatively poorly there too (I mean, initial sales were great, just as they were for the Dreamcast in America, but overall it's been considered a failure). If you can point me to some figures, though, I'll happily concede the point. It wasn't my theory to begin with (as I said, it was posed by someone at PlanetDreamcast).

As far as MegaDrive in Europe, as I already said to someone else (for Ireland in particular), Europe isn't exactly a make-or-break market for the console gaming industry. Winning the battle but losing the war, and all that...

Oh, and I'm not trying to predict doom for anyone. It's more like the random "curses" which American presidents fall under for various election circumstances and such. I think that the X-Box will fail for other reasons, though, and that the black case really just tends to be a self-fulfilling prophecy. :) And the PS2 looks dark blue, to me, not black, and although in its current state the PS2 would probably be a miserable failure, now that Sega's gonna be producing games for it, I think it'll survive.
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

Everything is relative. (none / 0) (#35)
by inpHilltr8r on Sun Feb 04, 2001 at 04:23:45 AM EST

OK, obviously success is relative, and I don't have figures to hand. True, 3rd party support was hardly stellar (mostly down to cart production costs), but the main Nintendo published titles, Mario, Zelda, Goldeneye, all sat at the top of the charts, and are generally rated as some of the best games out of this generation of consoles. Made it's money back, hosted some of the biggest selling, and critically aclaimed titles, not really what I'd call a failure. Now the virtual-boy, that was a failure, unless you're interested in headache research.

As to Europe, it's still the third largest market after Japan and the US, and it'd be foolish to discount it as irrelevant. Megadrive sales in Europe pretty much kept Sega going. Saturn sold poorly though, and yes, it was black in Europe too.

I saw that Ireland jibe, thought was a bit like saying that success in Ohio wasn't relevant. Sum of the parts and all that. Mind you, Europe's a pig of a market. 50Hz (so you either re-tune the entire game, or accept the slowdown, hence the popularity of US import consoles), higher res (so either black borders, or more recoding), half a million localisations to get right (ok, six or seven, and none as evil as japanese, but it's still a pain), and the germans won't let you get away with red blood, and... blah blah blah. I can completely understand why many games never get a proper european release.

Mind you. I still think the whole black-console-curse thing's a nice idea, but the PS2's definately black, eveything about it's black, and I can't really see them releasing it in any other colours (except possibly silver-grey) without a redesign (which I hope and pray for). Although I can't see it failing now. We've got pretty much every japanese developer on board now (note how Sega announced deals with Sony, and Nintendo, spot the missing player), bar Nintendo (who are quite happy playing with their poke-ball, in their poke-garden) on board now, and some of the next round of releases are jaw-dropping. The replay mode of GT3 in particular is scary real. Against what? The ever-reliable Microsoft (who can't leverage windows this time;), and a bunch of PC ports? It's going to be interesting, especially as my old company has pretty much bet the farm on the thing.

So what colour do you reckon the Jaguar was? Looks near-black to me...

[ Parent ]

Relevant pigs (none / 0) (#39)
by fluffy grue on Sun Feb 04, 2001 at 01:13:31 PM EST

Color stuff: The virtual boy was black (with red trim), too. :) And yes, I already mentioned the (black) Jaguar somewhere in this thread... what, are you presuming that it was a success? ;) Oh, and other black failure consoles include the Amiga CD32, and if you want to extend to "interactive CD entertainment" systems (not really game consoles) then you also get the Amiga CDTV and the CDi. Ancillary Sega failures (which were all black) are the 32X, SegaCD, GameGear, and Nomad (the last two being portable versions of the SMS and Genesis, respectively). Oh, and the 3DO. Whee, that thing sucked, and yet I recently saw a pawn shop trying to sell one for $100 without any controllers or game or anything (yes, it was really friggin' dusty).

Thing is, mentioning failed black consoles isn't that useful. If anyone can mention a single stellarly-successful black console (preferrably post-crash - the market was just way too fucked up before the crash to make any reasonable judgements on things like the Intellivision and Colecovision and such, neither of which were really black IIRC), that'd be much more useful. :) As it stands, it's pretty convenient that almost all of the failed consoles have been black (Dreamcast is the only non-black one I can think of offhand, and I wouldn't completely write it off as a failure just yet).

Markets: Well, Nader was the third most-voted candidate in this past US presidential election, but... ;) And yeah, the PAL and censorship issues make it so that the console developers don't WANT Europe to be a major market; that was assumed in my reasoning, but as usual I decided not to write a 1000-word treatise. Vicious self-feeding cycle, in any case.

If the PS2's black, then maybe it'll break the curse. Or maybe it'll fall to the wayside of the Gamecube. So far it isn't exactly off to a stellar start (last I heard, people mostly use the PS2 to play PS1 games and DVDs, neither of which it's particularly good at due to compatability problems and such). Hell, maybe Dreamcast will suddenly make a huge comeback when people buy them up at $100 and Sega is suddenly making a fuckload of money in software sales...
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

Recount! (none / 0) (#41)
by inpHilltr8r on Sun Feb 04, 2001 at 05:40:45 PM EST

Although if it's so much of a pig to develop for, why bother at all. Unless...

From the Final Evaluation of the INFO2000 Programme Conducted for the European Commission : Final Report : Volume Two

1.7.3 The leisure software market and video games

The European market for leisure software experienced a tremendous growth during the 1990's. According to Screen Digest statistics, since 1997 interactive leisure software sales in Europe have exceeded (in value) those in Japan; in 1998, they equalled for the first time the sales in the USA; and in 1999, the European market became the first market for the interactive leisure software sales. The European market reached a level of industrial maturity with horizontal and vertical concentration moves (for example, take-over of GT Interactive Software by Infogrames)

Among the leisure software market, the video games segment is, by far, the most important. In 1999, it represented 80% of the leisure software sales in units, and 83,5% of the sales in value.

Among the European Union, three countries pull the market growth: Germany, the United Kingdom and France. They account for about 75% of the European sales.

Now I'll grant you I'm not certain about the strict definition of leisure software used here, but if video games represent ~80% of that market, and the overall market size is larger than both that of the US and Japan, then it doesn't take the math skills of a Florida vote counter to draw the conclusion that the European video games market is at the very least, on a par with those of the US and Japan, if not, larger.

Slightly more significant than Nader..;)

[ Parent ]

Hehe... (none / 0) (#42)
by inpHilltr8r on Sun Feb 04, 2001 at 05:49:27 PM EST

Long list of sucky black (or dark-grey;) consoles there, and we ported Creature Shock to most of them, (although I think the only one of the more esoteric ones to make it to market was the CDi version) my god I'm glad the industries moved on from fmv games.

As to the PS2's dodgy start. Does no-one recall the appalling return figures Sega had for the Dreamcasts US launch? The near-complete lack of launch titles for the N64? Console launches are always tricky periods. It's the first time new hardware gets mass produced, developers have often only had the devkits for a few months, it's a miracle the PS2 launched with anything at all. The latter half of this year will be the proving time. Still, I'm biased...;)

[ Parent ]

Launch (none / 0) (#44)
by fluffy grue on Sun Feb 04, 2001 at 10:42:10 PM EST

Um. I seem to recall that the Dreamcast's US launch went rather spectacularly. Didn't they sell a few million consoles in the first few days? Same goes for N64... at least, I have 'fond' memories of standing in line for many hours because I was shopping at a store (for something completely unrelated) which happened to be carrying the N64 on launch day (at least I got to laugh at a lot of people who were buying the N64 but not getting any games for it). I do remember how few games there were for it at US launch (there was, like, Mario 64, and not a whole lot else), but for the Dreamcast there were quite a few good launch titles (Sonic Adventure, Soul Calibur) and more hit the shelves not too long after that.

I wonder if we're in different realities or something. I mean, in your world, N64s are brown, N64's and Dreamcast's respective US launches were dismal failures, and the software for the PS2 at launch was apparently not done by various Japanese developers who have had dev kits for well over a year, well in time for the Japan launch which was quite some time ago... :)
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

Different perspectives... (none / 0) (#45)
by inpHilltr8r on Mon Feb 05, 2001 at 01:32:10 AM EST

Sega had problems with bad GD-rom pressings of many early titles.

Japanese PS2 developers had much less than a year between the green (2/3 speed) devkits, and Japanese launch. The dust on my own TOOL is only about 10 months old.

...and alright, the N64 is black, if you have no concept of grey.

[ Parent ]

Jeeze :) (none / 0) (#47)
by fluffy grue on Mon Feb 05, 2001 at 12:18:41 PM EST

It's dark grey, which is close enough to black to be considered black. There is no such thing as pure black. There is always a small amount of specular reflection, background noise, and other things which make it impossible to have a pure black. The diffuse reflection on the N64 is Close Enough to black that it's a black console, just as my alarm clock, keyboard, external modem, and several other things are black even though they're all different shades of matte-shiny black.

And you were saying it's brown before. :P
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

Indeed. (none / 0) (#48)
by inpHilltr8r on Mon Feb 05, 2001 at 08:27:09 PM EST

...and you seem to think the PS2 is blue, so I guess neither of us has perfect colour vision WRT to hue. Not an uncommon trait amongst the more technically inclined apparently.

But in terms of intensity, there's matt black, and there's dark gray.

That said, I believe we've now hit bottom on this one, if not already actively tunneling. So I think we'll just have to agree to differ on this crucial distinction...;)


[ Parent ]
Case color (none / 0) (#32)
by fluffy grue on Sat Feb 03, 2001 at 11:42:23 PM EST

BTW, on my (first-gen) N64, the underbelly and top are the same color. Maybe yours has been out in the sun too long or something. :)

the top and the bottom and side. ph34r my n64's DUB P0W3R or something.
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

Aaahh... (none / 0) (#34)
by inpHilltr8r on Sun Feb 04, 2001 at 03:24:35 AM EST

...ok, I think we have different definitions of black. To me, that's dark grey, the powerpack is what I'd call black. Mine still looks brown to me, but the girlfriend thinks it's dark grey, and what I thought was the undertray, is in fact the front feet, which are definately black.

[ Parent ]
N64 a success in Japan? (none / 0) (#33)
by fluffy grue on Sat Feb 03, 2001 at 11:47:02 PM EST

Not according to an article on N64 RPGs...
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

Well he would say that... (none / 0) (#36)
by inpHilltr8r on Sun Feb 04, 2001 at 05:13:25 AM EST

A more relevant article.

[ Parent ]
Which doesn't help (none / 0) (#38)
by fluffy grue on Sun Feb 04, 2001 at 01:02:02 PM EST

It's post-Funtastic, so it's polluted by the colored cases.
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

On second thoughts... (none / 0) (#30)
by inpHilltr8r on Sat Feb 03, 2001 at 07:43:55 PM EST

...maybe it was just the black N64's that failed, I mean, for a while you could buy a black Playstation, and that didn't sell particularly well.

Mind you, both the PS2, and the X-Box are black, so are you predicting the domination of the GameCube this round?

[ Parent ]
Black PS2 (none / 0) (#37)
by fluffy grue on Sun Feb 04, 2001 at 01:01:13 PM EST

The black PSX is a separate beast... the net.yaroze was prohibitively expensive. But then again, it was a Playstation development kit, so...
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

...so. (none / 0) (#40)
by inpHilltr8r on Sun Feb 04, 2001 at 04:46:15 PM EST

I still have no idea why the Yaroze was so expensive. It was only one 1$ chip different from the normal playstations.

[ Parent ]
API? (none / 0) (#43)
by fluffy grue on Sun Feb 04, 2001 at 10:36:46 PM EST

Maybe it's because they didn't want it to catch on, since then their APIs would have been partially exposed to the world at large. Or maybe it's because of the CodeWarrior for MIPS license it came with... :)
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

And another thing (4.00 / 1) (#28)
by fluffy grue on Sat Feb 03, 2001 at 11:18:44 AM EST

Most of Nintendo's earnings are on Gameboy (thanks to Pokemon), not on N64. The Gameboy definitely isn't a failure in any sense of the word; hell, the hardware's barely changed since its original release over 10 years ago, and it's still going strong, and its software library is so big that Nintendo has done something unprecedented (for them) with the Gameboy Advance - they're making it backwards-compatible!
--
"Is not a quine" is not a quine.
I have a master's degree in science!

[ Hug Your Trikuare ]
[ Parent ]

Price of X-box (4.33 / 3) (#14)
by tftp on Thu Feb 01, 2001 at 06:53:10 AM EST

The X-box can be not only a loss leader for MS, it can also be a product that is difficult to maintain. MS is spreading itself too thin - in last years it tried to enter several new markets, and the worst of it is that they got in. Now MS is not only a Windows maker, they make Office, games, Encarta/Atlas, news (MSNBC), they try to enter enterprise space (where x86 does not belong to start with), an embedded arena (WinCE), WinTV, and now a dedicated gaming box.

However their stock price is down (and probably will stay down for a while), this prompts exodus of employees (they were paid in stock options instead of money). Without people MS can't work, and MS needs a lot of people now. X-box will only add to that, and MS never designed any hardware of that complexity before (a joystick was probably most complex). Even worse, a joystick was always a joystick; not so with gaming boxes - a competitor will be able to add a gizmo or two, and X-box becomes a moving target.

I Agree Mostly... (5.00 / 1) (#20)
by Anonymous 6522 on Thu Feb 01, 2001 at 10:47:59 PM EST

but producing Office is really a good deal for MS, I've heard that that is were they make the most money. Otherwise MS is trying to spread itself to places were it would take them more effort than they're willing to expend to make a good product, such as with WinCE.

[ Parent ]
Bad markets and good markets (about WinCE) (5.00 / 3) (#21)
by tftp on Fri Feb 02, 2001 at 06:04:51 AM EST

Often failed companies say, withdrawing from markets that they failed to settle in: "We return back to our core competency business". For MS such core competency would be DOS, Windows and some Windows apps, mostly Office - because they have undisputed (and still barely challenged) monopoly. If they want they can sell Windows and Office forever, and many people will be happy to buy the stuff for many years to come.

However this does not work well for MS. They can not become an "old" company with 0.5% annual growth rate. This would destroy their market share, which would lead to stock price drop, which would further reduce market share... until it stabilizes at some reasonable mark, as it is the case with other software companies (Intuit, Oracle etc.)

So MS has to push forward and exceed expectations every single time. Even loss of confidence in "infallible MS empire" can be the beginning of the end. They are just a big pyramid scheme, with employees and shareholders both firlmy hooked. That is why they have to enter other markets, even if they know that they can not succeed there - at least, succeed easily.

The WinCE failure is one such foray into unknown market. I saw it almost first hand - I tried to use WinCE in a portable device. Quality of the system was worse than I ever saw anywhere; it didn't work well, required plenty of horsepower to do simplest things and we eventually abandoned it in favor of other RTOS from an established vendor with a clue. Now looks like MS pushed WinCE through several revisions, maybe it is now even usable - but who cares? The train left the station long ago. The RTOS market is chock full of vendors small and large who offer a variety of RTOSes - free and for money, with source or without, from 10KB to 10MB footprint... WinCE is just one of many players, and not an important one either.

The biggest problem with WinCE was that nobody at MS actually knew what they want to build. In fact, in real-time, embedded world it is impossible to cover all bases and fit all bills with just one OS. Hey, WinCE won't even work on 16-bit CPU or a 32-bit CPU without MMU. Who in embedded world even heard about MMU? We work in flat address space; if it is paged then it's because of our hardware, not because the OS wants to map another process. Complexity is unacceptable in embedded world. So I don't see many applications for WinCE. MS initially pushed it as a "universal, scalable" OS but finally settled on palm pilot-like devices. Good. But compare the weight of Pilot and some WinCE-based organizer. Pilot works on 2 AAA batteries for months. WinCE device has to use internal Lithium battery, so power-hungry it is!

So indeed, MS can eventually throw enough money and people at the problem. But this still takes time, and they are only chasing others' tails by doing that. The more ground they try to cover the less spectacular results they get, and when (from now on) programmers are in demand there is less and less reasons to toil 24/7 for mere $50K/yr, especially in weather more suitable for fish than for humans :-) MS will retreat, we already saw some of that (MSDN reorgs). They can't be everywhere, and they don't really want to. But MS doesn't know it yet.

[ Parent ]

Poll ummm N64 option? (4.33 / 3) (#18)
by codemonkey_uk on Thu Feb 01, 2001 at 08:37:22 AM EST

Where is it?

I like the N64. Its the best. It may have "failed" comercially, but in my house its a roaring sucess.

Tetrisphere. Goldeneye. WaveRace. PuzzelBobble. All classics.
---
Thad
"The most savage controversies are those about matters as to which there is no good evidence either way." - Bertrand Russell

PC hardware in X-box (4.50 / 2) (#22)
by Peeteriz on Fri Feb 02, 2001 at 07:30:39 AM EST

As I understand, the x-box is supposed to be PC compatible, with directx, etc.
If it will be sold cheaper than it costs to manufacture, then what will keep me from bying x-box not to play the games, but to take out the processor/memory/hdd/video card for use elsewhere, because it would be cheaper to buy the x-box than the components themselves ?

nothing new (none / 0) (#27)
by axxeman on Sat Feb 03, 2001 at 02:27:54 AM EST

The same thing that keeps you from using standard PC parts on HP/Dell/Gateway boxes. Or at least makes it disproportionately hard.

Being or not being married isn't going to stop bestiality or incest. --- FlightTest
[ Parent ]

Not so far fetched (none / 0) (#46)
by Remmis on Mon Feb 05, 2001 at 07:09:55 AM EST

I read an article in a magazine awhile back that quoted bill gates as saying he looks forward to when every household in America will pay a Microsoft bill. Much as you would pay a water bill or phone bill. Such that there is no escaping using a Microsoft product or service day in and day out. Now you're probably reading that and saying "pfft, it would never reach that level". What I envision when I think about that is something along the lines of Divx, where you own the movie, but you have to pay each time you want to watch it. I'm willing to bet that microsoft will try something like that sooner or later with the X-Box.

I also think, on the average, if you're aged 5-25, you're either playing games on a computer, or on a console based system. I'm also willing to bet that one of the first games that becomes available for the X-Box will be for kids(hook em while their young). Someone earlier made reference to this sort of thing as "slashdot paranoia" or something along those lines, but I'm of the opinion that Microsoft is pointing us toward a more pay-per-use future where you'll be mailing out checks that say "Microsoft" on them the first of every month.




Will The X-Box Be Profitable? | 48 comments (42 topical, 6 editorial, 0 hidden)
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