Nintendo--VS--Microsoft

[Bond]

Originally Posted by Dyne

I agree. There's a word I'm looking for Microsoft's plan that fits them perfectly. Ah yes, I'm thinking of... demented. In a good unoffensive way, really. How do they keep going? I wonder if there's going to be a miracle or something and one game sells unexpectedly well. They've already sold North America and Europe.. if they can sell in Japan I'd say they could stay in no problem... but right now? They want to stay in so they can make.. great games, and have other people to enjoy them? Maybe they're like a big charity, or something. I've never seen Microsoft so "generous", but more like "demented".

You fail to see the larger picture. Currently, yes, Microsoft is losing money on the Xbox (although they are still making around eight billion dollars a quarter) but they are not in this for one generation. Microsoft is in the videogame market for the long haul. They need to spend a lot of money at first to get situated and make a name for themselves, and I would add that they are doing that quite successfully. In the next generation and generations to come they will make up their deficits and begin to turn a profit. Microsoft is a company full of intelligent people that knows what they are doing. Although we may always not like their products (Windows), they make a hell of a lot of money, and that's the bottom line. I wouldn't second guess one of the richest companies in the world.

[PuPPeT]

Originally Posted by viruscool

I dont think you have read the last few posts "PuPPeT". Just because nintendo isnt at the top of the console charts doesnt mean they're not making money. Nintendo are one of the more profitable companies in the gaming industry. So I agree they wont go out anytime soon, i think xbox will be next.

Yes but even Nintendo will tell you almost all of the money is made by the GBA and not the gamecube!!!! The Gamecube has under sold big time yes Nintendo has made money this year but how much of that has come from the Gamecube ?????????

[gekko]

TheGame, you're on the wrong track here. The only spiral Nintendo happens to be in is going uphill. Every year Nintendo is bringing in more money. Sega on the other hand, had suffered from Sega CD, 32X, Sega Saturn, CDX, Nomad and Dreamcast. Lots of money poured into R&D, lots poured into producing these systems, at a loss, and they didn't sell well so they never made it back in software sales. Even Genesis never produced a profit for Sega. On the other hand, N64 was not the top selling system, but it made a lot of money. Gamecube is not the top selling system, but it made a lot of money. Oh, and Game Boy just happens to be the best selling system of all time, and isn't slowing down. Big money. In fact, Nintendo has never failed to profit from any of their consoles. Financially, Nintendo is looking good, they would never drop out.

Userbase has nothing to do with a company leaving an industry. If that was the case, Apple with 4% of the PC market would be long gone. In reality, they're not gone, and they're profiting. Nintendo is no different. It doesn't matter how many developers are on board, it doesn't matter how many people own your system. What matters if profits. More developers and more sales means more profits, but as long as they are not reporting losses, they wouldn't have to make any cuts, much less dropping out of an entire industry.

As for the Microsoft situation, they're plan was to initially spend money to get their foot in the door, and then earn it back. It's all the old cliche, don't count your chickens before they hatch. Xbox has yet to make a profit, and that's not what Microsoft wants. Microsoft has their foot in the door, they put up the cash in the beginning to get the best hardware, and many exclusives. That phase is over, it's time to profit. Of course, along the way came a few drawbacks for that plan, including all the price cuts which has helped increase losses to Microsoft's Home and Entertainment division, which posts the biggest losses to the company. If they keep up at this pace, they will lose nearly a billion dollars this year. Ouch.

Now we also have the big unknown. How much is it going to cost Microsoft to develop Xbox 2? If Microsoft takes another large loss producing Xbox 2, and Nintendo and Sony both find a way to make profit from their systems, we might again see soon price cuts, and perhaps another 5 years without Xbox bringing it any money.

The reality is that Microsoft has yet to make any money from Xbox, while both competitors are profiting from their systems. Xbox is continually losing money, and is hurting Microsoft financially more than any other division. Initial losses may be part of the plan, but it's getting closer and closer to the time when Microsoft is hoping to make some money, and Xbox losses are getting larger and larger. You can bet the Xbox division is under close watch, and the people in charge are feeling the heat. Microsoft has yet to show that they are capable of making money from game consoles, and considering how unpredictable the gaming industry is, it would not be wise to assume that next generation Xbox is going to be bringing in large profits.

Xbox isn't going away anytime soon, but right now, they are at a far greater risk than Nintendo or Sony.

[GameKinG]

I know MS's supposed plan, or at least plan to make no profits seem less like a loss, is to make a stance this gen, and profit next. But if they blow the same amount of money next gen, I can seem the failing to get too much profit. So I think thats what would make them second guess this whole video game thing...

[TheGame]

Userbase has nothing to do with a company leaving an industry. If that was the case, Apple with 4% of the PC market would be long gone. In reality, they're not gone, and they're profiting. Nintendo is no different. It doesn't matter how many developers are on board, it doesn't matter how many people own your system. What matters if profits.

I think "money" matters more than "profits"... the more 'money' you are willing to blow to stop your system from floping directly effects how long you are going to stay on the shelf... more so than profits.

DC made more profits than Xbox, but that doesn't mean Sega had a chance in hell at staying on the shelves longer, does it?

I saw in a interview on G4TV that MS isn't even trying to make a dime of profit for both the Xbox and Xbox 2 generations... MS is in it for the long haul. Nintendo is (and has to) think about Making money in the next 12 months, MS is thinking down the lines of "20 years from now we want to own this industry"

Which completly destroys your point of profit being more important than the user base... MS isn't losing money for thier health, they are osing money so people likeme and you will go out and buy thier console and enjoy it so they can slowly take over.

Nintendo is more worried about profit than userbase because profits is somthing Nintendo needs to stay alive... let Nintendo release one console like Xbox and they would have quit financially within a year of it's life.

Don't get me wrong though, eventually profits are important, but comparing MS to Nintendo in profits now doesn't make a lick of sense.

MS is simply gambling... they are betting money, and because they have tons of money to lose, losing isn't even a problem, but when they lose enough times they will have to get up and leave before they throw too much money away... As long as MS continues to grow as far as the userbase, they will be sticking around for a while... if Xbox 2 does worse than Xbox (not financially, but user base wise), well, lol, that's the end of Microsoft in the gaming industry.

MS is playing for mind share and in the end will try to profit... Nintendo isn't playing for mind share at all, only profits.

If PSP beats GBA, or GBA's big brother (whatever that may be called), Nintendo is doomed because they lost thier easy form of profit and thier mind share.

So to break my Post down:

Microsoft lives if: Each generation thier Mind share gets larger.

Nintendo lives if: They continue making a big profit

Microsoft drops out if: Thier Money wasting experiment doesn't work and Xbox 2 is outsold by it's predicessor.

Nintendo dies if: They stop making a huge profit, and GBA is over ran by PSP.

I think that they both may survive... for a couple of reasons.

1) I don't see GBA being completly killed off

2) Obviously MS buying it's user base is working because they are tied with the second biggest gaming console manufactuer in the world in it's first outting. (not quite Psx, but eh, do you really think Psx would have stood a chance released side by side with N64? )

You also gotta take into account that MS won't need to advertize half as hard next time around, and they don't have to sit there and buy out developer after developer again. They also don't have to pay to introduce Xbox live again...

If MS trys to make a profit on Xbox 2, they could, but I think they will still be trying to put more into dominating the mind share... a Sega buyout right before the start of Next gen looks extremely likely imo.

[Rndm_Perfection]

And the long awaited question... Does it matter?

[cube]

I think that Microsoft should stop making systems with so much power that will never be used, also stop including hard drives, and stop including the modems. yes i know i sound crazy, they are nice things to have, but they cost a lot of money, the average buyer doesnt know how much more powerfull xbox is then ps2, a mom at best buy looking to buy her kid a console wont know the difference. They would definitly be much much more successfull if they put the money into getting some exclusive AAA titles for their console, along with putting more ads out on tv. You might think they have enough ads as is but its better to spend that 100 dollars they are using to buy that fancy hard drive and modem on something that people will remember when shopping. Growth is exponential, if you start out with a **** load of people talking about xbox, the **** load of people who heard from their freinds will tell others. This is what i think happened with the ps2.

[GameKinG]

Nintendo makes a lot of money. Compared to MS its not that much, but Its a lot to keep a company above stable. Nintendo has stood the test of time for over 100 years, Im sure there were hard times in there somewhere, but they managed to pull through, and now their very wealthy, even if they have to battle to keep second place...

[Stonecutter]

Originally Posted by cube

I think that Microsoft should stop making systems with so much power that will never be used, also stop including hard drives, and stop including the modems. yes i know i sound crazy, they are nice things to have, but they cost a lot of money, the average buyer doesnt know how much more powerfull xbox is then ps2, a mom at best buy looking to buy her kid a console wont know the difference. They would definitly be much much more successfull if they put the money into getting some exclusive AAA titles for their console, along with putting more ads out on tv. You might think they have enough ads as is but its better to spend that 100 dollars they are using to buy that fancy hard drive and modem on something that people will remember when shopping. Growth is exponential, if you start out with a **** load of people talking about xbox, the **** load of people who heard from their freinds will tell others. This is what i think happened with the ps2.

I Know the difference, and people who own an xbox generally know the difference.

So much power that it will never be used? Oh no, it's used, it's just that maybe 1/3 of the games on xbox are ps2 ports and developers are too lazy to optomize the games. If you ever wonderd why so many xbox owners hate the ps2, that's the reason why.

And anyone who owns and xbox can tell you just how AWESOME the harddrive is.

[One Winged Angel]

I have an XBox, and yes, the harddrive is awesome.

[PuPPeT]

Well I know one thing! Microsoft have set them self’s up well for the next generation even proving to Sony they don’t know every thing. Microsoft have showed they will be a leader Online gaming and if what some people are saying is ture by the end of the next generation it’s all going to be about ONLINE. (Some thing Nintendo suck at giving a really poor GBA link up instead ARF ARF!!!).

[Bond]

Originally Posted by cube

I think that Microsoft should stop making systems with so much power that will never be used, also stop including hard drives, and stop including the modems. yes i know i sound crazy, they are nice things to have, but they cost a lot of money, the average buyer doesnt know how much more powerfull xbox is then ps2, a mom at best buy looking to buy her kid a console wont know the difference. They would definitly be much much more successfull if they put the money into getting some exclusive AAA titles for their console, along with putting more ads out on tv. You might think they have enough ads as is but its better to spend that 100 dollars they are using to buy that fancy hard drive and modem on something that people will remember when shopping. Growth is exponential, if you start out with a **** load of people talking about xbox, the **** load of people who heard from their freinds will tell others. This is what i think happened with the ps2.

LOL.

Watch a hard drive and modem become a standard next generation. And you'll be saying how smart Nintendo was to have included it.

[Jonbo298]

I wouldn't mind if the next consoles had the HD and the modem built in. Just as long as the cost doesn't go up by $100 (or more or less [would be better]) just to include those and any other features built in. If the cost was only say $50 more to include those built in, I wouldnt mind. But $100 extra would be a little too much.

[cube]

Originally Posted by Stonecutter

I Know the difference, and people who own an xbox generally know the difference.
And anyone who owns and xbox can tell you just how AWESOME the harddrive is.

yeah, i know you know the difference and i know how awesome it is but you, are not the average customer. I was talking about what would be best for business not what would be most enjoyable for you.

Originally Posted by Stonecutter

So much power that it will never be used? Oh no, it's used, it's just that maybe 1/3 of the games on xbox are ps2 ports and developers are too lazy to optomize the games. If you ever wonderd why so many xbox owners hate the ps2, that's the reason why.

And i dont know if youll believe me but thats EXACTLY what i was trying to say, most games are gonna be multiconsole or ports, so they arent made to use that power, and so, it isnt used.This is also why i said ms should try to get more excusive titles, titles that were made to run on that level of power, not **** that was made to run on a 5 year old ps2.
So, dont flame me as i totally understand what youre thinking.

[gekko]

Originally Posted by TheGame

I think "money" matters more than "profits"... the more 'money' you are willing to blow to stop your system from floping directly effects how long you are going to stay on the shelf... more so than profits.

DC made more profits than Xbox, but that doesn't mean Sega had a chance in hell at staying on the shelves longer, does it?

Actually, Sega didn't make any profit off of DC. But back to the main topic, you're on the wrong track, again. If you're talking which system will be successful, userbase matters. If you're talking in 20 years who might have the best system, userbase matters. We're not talking about which system will dominate the industry, we're talking about which company would completely go out of business. Right now Nintendo is doing very well, PS2 is doing very well, and Xbox is doing very poorly. Nintendo and Sony are no concearn at all. Which only leaves one company at risk for dropping out, and that's Microsoft. Big risk? No, but Nintendo and Sony wouldn't benefit from leaving the industry. If that was the case, Microsoft might as well drop Windows.

Microsoft made $8 billion in profits last year. This year, Microsoft's Home & Entertainment division is on track to lose $1 billion. If you think either Microsoft or its investors are happy with those numbers, you're crazy. Microsoft didn't plan to profit from Xbox, but you can be assured they didn't expect their losses to increase over time, and they have.

Now when you get back to who is most likely to drop out, you have three choices:

1) Sony - Would make less money
2) Nintendo - Would make less money
3) Microsoft - Would increase profits by 10%

I think it's obvious.