Microsoft's Xbox Hole Just Got $1 Billion Deeper
from the any-day-now dept
Microsoft's Xbox unit has yet to turn a profit, but the company keeps insisting that profitability is just around the corner. That goal may have to wait a little bit longer, as the company has announced that it will take a $1.05-$1.15 Billion charge to cover certain manufacturing defects and the cost of giving consumers an extended warranty. The company is, of course, used to fixing products after they've been released, but repairing a manufacturing defect isn't quite as easy as pushing out a patch to cover a software bug. The company still claims that it the Xbox unit will hit its goal of achieving profitability by 2008, although it's hard to put much faith in that promise. Manufacturing issues notwithstanding, the broader industry picture is probably not how Microsoft imagined it when it first threw its hat into the ring. Far from achieving a comfortable duopoly with Sony, the two companies have badly bloodied themselves, while an unexpectedly resurgent Nintendo not only grabs significant market share, but makes money while doing it.![Hide This Hide this](https://ii.techdirt.com/s/t/i/topclose.png)
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xbox hole
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Not the whole story
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Re: Not the whole story
Would it be safe to assume that game/accessory/etc profits will play an equal roll for each console?
I guess I fail to understand what your getting at here.
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Re: Not the whole story
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Re: Not the whole story
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Re: Re: Not the whole story
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I'm on my second
"cost of giving consumers an extended warranty"
Douse this mean I'm getting another year of warranty?
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Re: I'm on my second
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Re: Anonymous Coward
"no vendor lockin": So if I buy a Mac or install Linux I can still totally run all the new games, right?
Also, PC hardware is more, not less, complex to write for, because it's less predictable: There are dozens (at least!) of different graphics card/sound card/processor/memory combinations that any given PC gamer might be running, and that's just hardware compatibility.
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Re: Re: Anonymous Coward
So I guess all that OpenGL and DirectX stuff is useless then, huh? You're talking about drivers, not game programming. There's this thing, in almost every operating system, called hardware abstraction. It makes it so that we don't have to program the interrupts, etc. when writing to a hard drive, or reading the keyboard/mouse.
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Re: Re: Re: Anonymous Coward
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The Breakdown
Overall though, the big money for them is in things like accessories and games. Without those two, there wouldn't really be any money. Until this current generation, no console was sold for a profit. Even now though, it's really just a minimal profit.
As for, "Does this mean I get another year on my warranty?": Yes. From the date of purchase you have three years. Albight, to be honest I'm not sure if it's three years from the date of purchase or the date of manufacture. Probably the latter. Just to be safe. ;P
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Game programmers haven't had to code for specific hardware since the days of DOS. Modern Windows systems have what is called a hardware abstraction layer that programmers code to. Look up Direct X.
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Re:
Yea, look up video card compatibilities for new games. the list doesn't exist for no reason.
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Xbox is a strategic market play not a Games Conso
Just think of the identity management side alone and see the leverage there. Because it's already connected to your home theatre or whatever this is a far better fit to the consumer market than any PC alternative. A door to every lounge room - you don't have to think too hard about what this will be worth to any company!
Like the phone company's give away the hardware and make money from the services.
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Re: Xbox is a strategic market play not a Games C
all the structures aren't in place yet, but the foundation is.
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Re: Re: Xbox is a strategic market play not a Gam
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it
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Re: it
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Aru?
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XBox
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360 works great
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