Xbox One Could Be Microsoft's Last Console

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Xbox One Could Be Microsoft's Last Console

With Microsoft CEO Steve Ballmer's exit, the company could either focus on hardware or business software.

Depending on the Xbox One's performance and the new direction Microsoft takes under a new CEO, the console could be the company's last attempt at gaming hardware. "I think this is a possibility," DFC Intelligence analyst David Cole told GamesIndustry International. "We have always wondered how long Microsoft would stay with the game hardware business. Their strategy for Xbox One clearly looks like it will not be a success on a grand scale."

Independent analyst Billy Pidgeon disagreed, saying, "Those looking at Microsoft with a high level perspective as part of the general technology ecosystem have a tendency to think of Xbox strictly as hardware business."

Nintendo, Sony, and Microsoft have all had -- and still have -- trouble marketing their game hardware. Regardless of the success or lack of success for the Xbox One, Microsoft's consoles add to a market in consumer software. In addition, Microsoft is ahead of other companies such as Apple and Google in the games market, and leaving that market could harm Microsoft. However, with a new CEO, it's possible Microsoft would compete these two companies more in the mobile games market.

Asif Khan, CEO of Panoptic Management Consultants, pointed out that the Xbox is "not what brings home the donuts for Microsoft." The Xbox One may be a tricky move for Microsoft to profit on long-run, but completely leaving the gaming business would be a strange move.

Source: GamesIndustry International

Permalink

Is there a reason I'm supposed to care about analysts?
Not trying to be offensive, but every time I hear about an analyst predicting doom and destruction it's accompanied by another analyst saying the opposite.
So either Microsoft will no longer make consoles or they will? Did we need a couple of analysts to tell us that? Aren't those the only two options for Microsoft when it comes to consoles? Either they make them or don't?

Good the sooner we get to a universal gaming hardware environment the better....

I've been saying this for a while. Coming in last for console sales in 2 generations in a row can't be good for investors. Neither is making very little profit of the 360 after losing billions on the original Xbox.

It's probably for the best, given the Danzig curse:

If Microsoft releases a fourth console, their drummer will die.

ZippyDSMlee:
Good the sooner we get to a universal gaming hardware environment the better....

Yeah! Cause monopolies always work out in the end right guys?

Saviordd1:

ZippyDSMlee:
Good the sooner we get to a universal gaming hardware environment the better....

Yeah! Cause monopolies always work out in the end right guys?

If you see a crappy game, don't buy it. Sounds simple enough.

This is not News in any way:

If Company X' new Y proves to be unsuccessful then that new Y might just be X' last Y!

Is that this news boils down to. And it is not new in any ways, that is just how good business works. If you waste Billions of Dollars on something, you don't repeat it.

Well that article was uncertain.

"they might, but might not, get out of the console business. It could, or could not, be a good thing for them"

We've all learned something today.

Saviordd1:

ZippyDSMlee:
Good the sooner we get to a universal gaming hardware environment the better....

Yeah! Cause monopolies always work out in the end right guys?

VHS,DVD,Blu ray are all universal formats IE they get together design the hardware sub out the work to vendors who build the units. It seems to work well for for the video industry......

I'd go so far as to say that if XBone goes the way of the Dreamcast, then it's the beginning of the end for console gaming as a whole. Annnnnnnnd at the moment, due to all the blunders they've made with the XBone, it certainly seems like that's going to be the case.

Not that Microsoft is some kind of major support for gaming that the industry couldn't stand to lose, but more just as a sign of the times. With MS out of the way, it'll be down to just Nintendo (which has been in a slump) and Sony. More and more people are signing up for the genetic enhancements necessary to join the PC Master Race (especially with the lack-luster showcasing of this coming generation). I dunno, just seems to me that it is time for us console gamers to repent, for the end is nigh.

lovest harding:
Is there a reason I'm supposed to care about analysts?
Not trying to be offensive, but every time I hear about an analyst predicting doom and destruction it's accompanied by another analyst saying the opposite.

Being an analyst is probably a great gig. Aside from becoming a politician or an investment banker, few other jobs will reward you for being consistently wrong.

One main point of contention here: all these analysts are totally missing what Microsoft is doing right now. They are trying to bring a unified experience to PCs, tablets, phones, and game consoles. Even if the Xbox One is only a moderate success, it's serving the dual purpose of advertising for Windows 8. If they even break even on it, that's still better for them than spending a fortune on an ad campaign. If it works in that regard, they'll continue to produce games consoles in the future just for that.

P.S. Thanks

ZippyDSMlee:

Saviordd1:

ZippyDSMlee:
Good the sooner we get to a universal gaming hardware environment the better....

Yeah! Cause monopolies always work out in the end right guys?

VHS,DVD,Blu ray are all universal formats IE they get together design the hardware sub out the work to vendors who build the units. It seems to work well for for the video industry......

Oh goody, so instead of 3 Consoles made by 3 different companies, we can have One console made by about 80 or 90 different companies, with some versions of the Console better then the other. Just like the Philip's CD-i! And that was a huge success!

You have to understand, that the Video Industry is nothing like the Video Game industry. Plus, there was competition between VHS's (Beta max's and laser discs come to mind), DVD's (With VHS's), and Blu-Ray (DVD and HD=DVD's, as well as MP3's, MP4's and other digital formats). A Universal Console would simply create a Monopoly the likes we haven't seen since the Windows based-PC domination of the Computer Market in the 90's, which ended so well for Microsoft. Point is, Monopolies are never a good thing, and they are always challenged; even in the Video Industry.

OT: It would suck if they do leave, but if they do, I hope Nintendo can re-buy RareWare. I need my fix of Banjo-Kazooie!

"Xbox One could be Microsoft's last console"

..ahem.

Anyways, that doesn't sound surprising. The entire Xbox division existed simply because Gates and Ballmer wanted to try and get Microsoft boxes into people's living rooms. Despite the fact that both consoles cost the company billions, they never got axed simply because Gates and Ballmer were set on the idea of trying to sell hardware.

Thing is, Ballmer's focus on hardware has been a disaster for the company. Since trying to turn Microsoft into a tech company to compete with Apple, Microsoft has ended up coming dead last in every market it's tried to enter. Windows phones and tablets are a niche device, with nowhere near the level of success of Android or iOS. Zune was a disaster. The 360 ended up finally getting outsold by the PS3, and has yet to turn a profit for Microsoft's Xbox division. And apparently, investors are't happy about this move away from Microsoft's key strength: software.

When Ballmer goes, Microsoft may just decide to go back to focusing on being a software company. Windows Vista and 8 really damaged their image there, and they need to start focusing on that side of things again. In such a situation, shedding their hardware divisions could be very likely.

Saviordd1:

ZippyDSMlee:
Good the sooner we get to a universal gaming hardware environment the better....

Yeah! Cause monopolies always work out in the end right guys?

One universal gaming hardware doesn't have to come from one house. PC is a prime example - there are quite a few you can choose from, even single pieces of it can come from different companies. Something similar can also happen for console - or they become the same as a PC in the first place.

Saviordd1:

ZippyDSMlee:
Good the sooner we get to a universal gaming hardware environment the better....

Yeah! Cause monopolies always work out in the end right guys?

I think he was talking more along the lines of VCR and DVD players, and not monopolies. Sure the formats could be called "monopolistic", but what it will come down to is being able to buy a license for that format and then creating your own form of console that interacts with that format.

ZippyDSMlee:
Good the sooner we get to a universal gaming hardware environment the better....

You mean like the PC?

Not trying to be a PC-elitist or anything. The move towards consoles has always been about creating strictly controlled markets, hence the lack of compatibility. Beneath the logo and proprietary software, consoles are just gaming-oriented PC boxes, and it'd be a boon to developers and consumers alike if the software (operating system) on these boxes was an open one, without gatekeepers controlling the content. It would also be great to have hardware manufacturers focus on creating the best hardware, rather than rely on software exclusives.

Unfortunately, regardless of industry, it is often easier to lock down a market than to compete fairly, so it is very unlikely to happen soon.

image
their whole marketing campaign was like a monty python sketch gone bad.

REALLY FUCKING BAD

and people are getting fed up with the shit the industry is flinging at them.

Mr.Mattress:

ZippyDSMlee:

Saviordd1:

Yeah! Cause monopolies always work out in the end right guys?

VHS,DVD,Blu ray are all universal formats IE they get together design the hardware sub out the work to vendors who build the units. It seems to work well for for the video industry......

Oh goody, so instead of 3 Consoles made by 3 different companies, we can have One console made by about 80 or 90 different companies, with some versions of the Console better then the other. Just like the Philip's CD-i! And that was a huge success!

You have to understand, that the Video Industry is nothing like the Video Game industry. Plus, there was competition between VHS's (Beta max's and laser discs come to mind), DVD's (With VHS's), and Blu-Ray (DVD and HD=DVD's, as well as MP3's, MP4's and other digital formats). A Universal Console would simply create a Monopoly the likes we haven't seen since the Windows based-PC domination of the Computer Market in the 90's, which ended so well for Microsoft. Point is, Monopolies are never a good thing, and they are always challenged; even in the Video Industry.

OT: It would suck if they do leave, but if they do, I hope Nintendo can re-buy RareWare. I need my fix of Banjo-Kazooie!

Not really as with the cost of games you get basically 1 go I doubt there will be many if any Beta/VHS or HDVD-Blu ray battles. Hell if I can build it for under 500 they can build it for under 300. You can also limit console versions in the licensing so that's no big deal. As for monopolies ,we have them now only you as the consumer have to shell out 3X the cost of what it would be with a universal format. We are worse off with exclusives and multi consoles that if you are a mediocre gamer or better you kinda must buy them all. So meh.

Exterminas:
This is not News in any way:

If Company X' new Y proves to be unsuccessful then that new Y might just be X' last Y!

Is that this news boils down to. And it is not new in any ways, that is just how good business works. If you waste Billions of Dollars on something, you don't repeat it.

"Alternatively, they might not," says other analyst.

On the plus side, at least they're not making batshit crazy claims like that one guy whose name escapes me right now.

Oskuro:

ZippyDSMlee:
Good the sooner we get to a universal gaming hardware environment the better....

You mean like the PC?

Not trying to be a PC-elitist or anything. The move towards consoles has always been about creating strictly controlled markets, hence the lack of compatibility. Beneath the logo and proprietary software, consoles are just gaming-oriented PC boxes, and it'd be a boon to developers and consumers alike if the software (operating system) on these boxes was an open one, without gatekeepers controlling the content. It would also be great to have hardware manufacturers focus on creating the best hardware, rather than rely on software exclusives.

Unfortunately, regardless of industry, it is often easier to lock down a market than to compete fairly, so it is very unlikely to happen soon.

There are 2 problems with the PC a high customizable OS which can become unstable, many different types of hardware and various issues with different builds and drivers. You boil all that down to one setup with its own security system.The games are almost identical to the PC but will not work on a PC,ect,ect.

Given the fact that their video game hardware is still in murky waters and their software division is suffering from trying to beat Apple at its own game (Windows 8, anyone?), Microsoft as a whole is taking water fast. Unless they can make a major 180 in the near future, we may be witnesses to the fall of a once mighty titan of the computer industry.

Zachary Amaranth:

Exterminas:
This is not News in any way:

If Company X' new Y proves to be unsuccessful then that new Y might just be X' last Y!

Is that this news boils down to. And it is not new in any ways, that is just how good business works. If you waste Billions of Dollars on something, you don't repeat it.

"Alternatively, they might not," says other analyst.

On the plus side, at least they're not making batshit crazy claims like that one guy whose name escapes me right now.

Pachter, maybe?

OT: I could easily see this happening. Hasn't Microsoft only lost money on the original Xbox and the 360?

j-e-f-f-e-r-s:
"Xbox One could be Microsoft's last console"

..ahem.

Anyways, that doesn't sound surprising. The entire Xbox division existed simply because Gates and Ballmer wanted to try and get Microsoft boxes into people's living rooms. Despite the fact that both consoles cost the company billions, they never got axed simply because Gates and Ballmer were set on the idea of trying to sell hardware.

Thing is, Ballmer's focus on hardware has been a disaster for the company. Since trying to turn Microsoft into a tech company to compete with Apple, Microsoft has ended up coming dead last in every market it's tried to enter. Windows phones and tablets are a niche device, with nowhere near the level of success of Android or iOS. Zune was a disaster. The 360 ended up finally getting outsold by the PS3, and has yet to turn a profit for Microsoft's Xbox division. And apparently, investors are't happy about this move away from Microsoft's key strength: software.

When Ballmer goes, Microsoft may just decide to go back to focusing on being a software company. Windows Vista and 8 really damaged their image there, and they need to start focusing on that side of things again. In such a situation, shedding their hardware divisions could be very likely.

Came in here pretty much to post this. There's been grumblings for a while that Microsoft needed to go back to focusing on software, because it's what they've always been good at. Even the disaster that is Windows 8 ultimately comes down to them wanting to get into the hardware market -- it's a tablet OS, because Microsoft makes tablets now, and they wanted to unify the tablet and desktop environment. I actually will be kind of sad to see the Xbox go, not because I like the system but because I like competition. But if it means Microsoft will start putting out great software again, I'm game. I'd rather have a functioning Windows based PC and a console made by Sony or Nintendo (or heck, skip the console entirely) than a PC with a crappy OS but a cool console made on the side by Microsoft.

Even if they are successful with the X-Box One there is still the question of will the console survive to another cycle when there is so much competition for your gaming and entertainment time? Will game developers evolve the gaming market or will it just be the same things marketed toward a smaller and smaller target demographic as people lose interest?

I wonder what roosterteeth would do if companies stopped making games for Xbox one.

Bleidd Whitefalcon:

Pachter, maybe?

Yeah, Michael Patcher. For the life of me, I couldn't remember his name.
Then again, I hear if you say his name three times he appears, so it may be for the best.

Saviordd1:

ZippyDSMlee:
Good the sooner we get to a universal gaming hardware environment the better....

Yeah! Cause monopolies always work out in the end right guys?

My thoughts exactly. I'll be happy if Microsoft can get the fuck out of the gaming industry so we can finally have some competition from a company that doesn't make shite on a regular basis.

AzrealMaximillion:
I've been saying this for a while. Coming in last for console sales in 2 generations in a row can't be good for investors. Neither is making very little profit of the 360 after losing billions on the original Xbox.

When have they come in last in console sales 2 generations in a row?

The original Xbox outsdold the Gamecube worldwide by a small margin, and outsold the Dreamcast by almost 14 million units.

It was however, eclipsed, by the PS2. But everything was that generation. The current gen I think worldwide it has come last though, but I'd have to check the PS3 figures.

This may be a bit off in left field, but what I think we're witnessing is the natural result of a company hitting a glass ceiling. What I mean by that is that to some extent, there are limits on the profit potential of video games, limits on the size of the market, and limits as to what people are willing to buy. While gaming may not be the niche market it used to be, there is only so much room for companies to expand and flourish, and we have two major contenders (Sony and Microsoft) that are finding out that once you've hit that glass ceiling, every effort you make to break through it and increase your profits and market share will backfire.

If you attempt to curb piracy via DRM methods, eventually you will suffer more losses from the backlash than you did the piracy. EA's Simcity debacle is proof enough of that.

If you attempt to broaden the base market by trying to make your machine an "all-in-one", like Sony did with the PS3 (remember all the things it was intended to be able to do?) and Microsoft with the XBone, you risk driving the price so high that sales suffer until you take a huge loss on every machine with price drops.

If you attempt to make a huge, spectacular gaming experience that rivals blockbuster movies in both scope and in cost in an effort to make a "must-play" game, and to do so you have to sell 5 million copies and don't, well, we've all seen what happens then; just ask Jim Sterling.

Eventually, every video game console maker is going to realize that there is only so much money to be made in the industry, and if that's not enough for them, they'll bail on it, leaving the one console maker who has consistently had reasonable expectations and made their consoles and games based on those reasonable expectations: Nintendo.

Nintendo will ultimately win the console wars, because they understand when enough is enough.

So this means the PC market will totally dominate gaming in due time? If I'm correct, it has been for the past 5 years being ahead in terms of hardware innovations with faster CPUs, video cards and RAM.

For the record, people, this doesn't necessarily mean the PC will dominate, in fact it'll mean a less game-friendly OS, ala win8. This is not good

Yes, surely Microsoft's plan during their shift to being a more consumer-electronics oriented company is going to involve ditching their most successful consumer-electronics product (Which has, quite to the contrary of the memes going around, been highly profitable since a couple years into the 360's run).

I mean, sure, the 360 has been great for them, but who wants to hang on to that market with all of the money that their phone and tablet businesses have been making? And why bother with a still-growing gaming market when they've still got a lock on the shrinking PC OS market?

Next up: David Cole predicts Microsoft getting out of the Server business to focus on MP3 players!

Even if they pulled out I still can't see PC "dominating" or "winning" over everything else since we'd still have Sony and Nintendo like we've had over the past 2 decades.

Though it seems to be a pipe dream many PC only people dream about, god knows why they do when some people just don't want to game on a PC.

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