X-Box: $-1,000,000,000 a year

[A Black Falcon]

http://www.forbes.com/home/technology/20...osoft.html

The Xbox game console is hot, but its division has lost $4 billion in four years and isn't yet in the black.

[Great Rumbler]

Unlike Nintendo...

[A Black Falcon]

Yup.

[Geno]

(does the Nelson "Ha ha!" from The Simpsons)

[The Former DMiller]

To be fair, Microsoft said going in that they were going to lose a lot of money on the original Xbox. If they do the same with the 360, though...

[Dark Jaguar]

I have to say, if this happens to MS again, they will not produce another console. I can't see them justifying it. I mean, when you spend more making a system than you get back from sales, selling a LOT just means you lost a lot. The only hope is to make up for it all in game sales. Apparently, MS didn't do that. Sure they are doing pretty well in America, in second place (barely) with Nintendo, but world-wide, not so much, and it hurts them. I mean, what games is MS themselves selling? Halo 2? Anything else? They have Rare, but not enough people seem to care about that. I'm sure the sales of PDZ are going to be stellar, so long as there's some distant link printed on the box between it and Halo and they hype it up as much as they did Halo, but other than that? It's a shame really....

I don't think Nintendo is going to "buy Rare back" or anything, so here's something else. Rare should become independant.

[EdenMaster]

Wow, I knew they started poorly but I didn't realize they had yet to break even. They'd better do a good job with 360. I don't think a similar event with 360 would cause MS to drop out of the console race. I mean, this is Microsoft, one of the largest, most powerful, and richest corporations in the world. They can stand to lose some money, and the X-Box has been picking up steam. The first X-Box was a newcomer and an unknown when it came out, so many were apprehensive about it, but now that MS has (kinda) established themselves in the console market, I think the 360 will have a warmer reception when it comes out. Coming out long before it's two big competitors is sure to help, as well.

[Paco]

I have to say, if this happens to MS again, they will not produce another console. I can't see them justifying it. I mean, when you spend more making a system than you get back from sales, selling a LOT just means you lost a lot. The only hope is to make up for it all in game sales. Apparently, MS didn't do that. Sure they are doing pretty well in America, in second place (barely) with Nintendo, but world-wide, not so much, and it hurts them. I mean, what games is MS themselves selling? Halo 2? Anything else? They have Rare, but not enough people seem to care about that. I'm sure the sales of PDZ are going to be stellar, so long as there's some distant link printed on the box between it and Halo and they hype it up as much as they did Halo, but other than that? It's a shame really....

I don't think Nintendo is going to "buy Rare back" or anything, so here's something else. Rare should become independant.

Microsoft is publishing a bunch of titles, off the top of my head:

99 Nights
Gears of War
Every Party
Blue Dragon
Lost Odyssey
Perfect Dark Zero
Kameo
Amped 3 (I think)
Project Gotham 3
Forza 2

Do you know if Microsoft published Fable or Jade Empire? Both games' sequels are headed to Xbox 360.

Just off the top of my head, I'm sure there are one or two I missed out of the 160 titles already announced for the system. I could find a list later on but I believe they rank pretty high on the publisher list. It's the hardware that's sinking them.

From what I read the Xbox 360 is cheap to make, and they'll be selling it at a very minimal loss. Seeing as how Microsoft has full control over the entire production of the 360 they'll be able to make it cheaper, faster (unlike the raping they got on the Xbox). I think it was said they expect annual cost reductions (don't confuse that with annual price cuts, though that's not out of the question).

Every third party is on in one way or another, plus alot of Japanese developers. They can't ignore the growing userbase for the Xbox in the states, especially since Japan's gaming market seems to be eroding. Seriously, did you expect games like Resident Evil 5, Tenchu, Armored Core 4, Ridge Racer 6, Mobile Suit Gundam, and two RPGs (Lost Odyssey, Blue Dragon) from a well known RPG creator, and 5 games from Team Ninja to be announced for the Xbox 360 this early on? Not to meantion the unnamed Namco RPG. It reads like a Playstation lineup, imo.

Really, I don't see them going anywhere but up.

[EdenMaster]

Y'know Paco. Maybe I'm just not observant, but just a second ago I saw the PS2 in your avatar. I never noticed it before :D

[A Black Falcon]

I guess we needed someone here who has to be an X360 fan... ... I guess...

From what I read the Xbox 360 is cheap to make, and they'll be selling it at a very minimal loss. Seeing as how Microsoft has full control over the entire production of the 360 they'll be able to make it cheaper, faster (unlike the raping they got on the Xbox). I think it was said they expect annual cost reductions (don't confuse that with annual price cuts, though that's not out of the question).

I'd say you're being optimistic there. Minimal loss? Sorry... they'll lose money. Oh, they're partially trying to cope by having that "core" system which has a corded controller and no harddrive, but they'll still lose a good bit. This isn't cheap stuff. Oh yes, and what does "full control over the production" mean? As far as I can tell, nothing...

Every third party is on in one way or another, plus alot of Japanese developers. They can't ignore the growing userbase for the Xbox in the states, especially since Japan's gaming market seems to be eroding. Seriously, did you expect games like Resident Evil 5, Tenchu, Armored Core 4, Ridge Racer 6, Mobile Suit Gundam, and two RPGs (Lost Odyssey, Blue Dragon) from a well known RPG creator, and 5 games from Team Ninja to be announced for the Xbox 360 this early on? Not to meantion the unnamed Namco RPG. It reads like a Playstation lineup, imo.

Ah yes, the great support from Square... oh wait, it's a port of a PC and PS2 game? Right... Tecmo? They're already weirdly in love with X-Box so it's expected. As for the others, yes, MS is clearly making a better effort than before, and launching first will help, but between how dominant the PS2 is (really, the next console generation starts when PS3 launches, I think...) and how the Japanese don't really like foreign stuff, it won't make a big enough dent to truly damage Sony. Or Nintendo, for that matter, in the Japanese market.

[Great Rumbler]

If that Xbox360 doesn't do a whole lot better in Japan than than the Xbox did then most Japanese developers simply won't care one bit about it, almost completely regardless of how well it does elsewhere.

[A Black Falcon]

Yes, as I said, you need to understand Japanese biases (against anything not made in Japan) to understand these things... it is a factor. Not the only factor certainly, but it's definitely a factor... there are other ones too, of course, like the kinds of games people like -- look at what sold the most X-Boxes in the US. Halo and Halo 2. The Japanese aren't big FPS fans. So what do they have? Not a lot... American PC-style RPGs? Not that popular there. Dead or Alive? That sells, but only so much... MS is doing some things to try to help itsself, and it should do better than it did this generation, but I think it doesn't have much of a hope of being second in Japan this console generation. Between Sony and Nintendo, it's not going to do it.

[EdenMaster]

I guess we needed someone here who has to be an X360 fan... ... I guess...

Since nick isn't around too much to be the MS fanboy, I suppose Paco will have to be our punching bag :D.

[A Black Falcon]

Yup... :)

... let's hope he doesn't go away for four or five months again?

[UltraMarioMan]

Holy crap on a saltine cracker on a bun rolled in cheese covered in ants coated with moss in a taco shell!

[EdenMaster]

Holy crap on a saltine cracker on a bun rolled in cheese covered in ants coated with moss in a taco shell!

Oh great. Now I'm hungry!

[A Black Falcon]

Even the part about ants?

[EdenMaster]

...

It was a joke, ABF! A joke that <i>YOU RUINED</i> with your serious observations!!!

[Dark Jaguar]

You are aware he himself was joking by only pointing out the ants, even though there are many other ingrediants on that saltine far less palletable.

[EdenMaster]

But...ABF doesn't joke! It's simply not done!

[A Black Falcon]

Moss, you mean? Eh, that's probably better than ants...

Oh, and as for the original topic...

http://ve3dboards.ign.com/message.asp?topic=21741473

A guy there has a bunch of links for costs... Xbox lost money every single quarter except winter '04 (Halo 2). Some people wanted to blame this on either Xbox or X360 development costs, but for the most part it's not... it's all spread out. MS is just that good at losing money in the console business. :)

For comparison, Sega pulled out of the console industry because it lost $800 million in two years. MS? 4 billion down and they barely care... the joys of being a $228 billion dollar company?
http://www.gamasutra.com/newswire/news/i...000522.htm

[Great Rumbler]

And if you need anything...there's some ants.

[Dark Jaguar]

There's one other ingrediant I noticed on there that is less than savory.

[A Black Falcon]

I took that to just be an expression and not actually be on the hypothetical cracker, but yes, if so, you're right about that one...

[EdenMaster]

Haha, who else would say "on the hypothetical cracker" but ABF? :D

[Weltall]

A hypothetical cracker is downeast slang for a white scientist.

[A Black Falcon]

Yeah, but I meant it like the cracker, a very tasty food item (though not ... the way it was described there...), not the slang word I wouldn't use in that sense anyway. :)

[Paco]

Y'know Paco. Maybe I'm just not observant, but just a second ago I saw the PS2 in your avatar. I never noticed it before
<!-- / message --><!-- sig -->

It's been there since I made the avatar several months ago. Can you guess who's head that is? ;)

I'd say you're being optimistic there. Minimal loss? Sorry... they'll lose money. Oh, they're partially trying to cope by having that "core" system which has a corded controller and no harddrive, but they'll still lose a good bit. This isn't cheap stuff. Oh yes, and what does "full control over the production" mean? As far as I can tell, nothing...

Of course it's not cheap in the sense that they're just giving it away, but in the sense that Microsoft learned from their mistake with the Xbox. Microsoft has been forking out a huge amount of money for the GPU, and the deal they made with Nvidia concerning the royalties has proven to be one of the most expensive parts in the Xbox.

This time Microsoft owns all the tech themselves (they're not licensing it from the GPU maker). All they pay for this time is the production costs, and that will get cheaper over time (MS expects annual cost reductions). The royalty fee they were paying Nvidia never budged.

Plus, they are making the customer pay for the harddrive this time.

Ah yes, the great support from Square... oh wait, it's a port of a PC and PS2 game? Right... Tecmo? They're already weirdly in love with X-Box so it's expected. As for the others, yes, MS is clearly making a better effort than before, and launching first will help, but between how dominant the PS2 is (really, the next console generation starts when PS3 launches, I think...) and how the Japanese don't really like foreign stuff, it won't make a big enough dent to truly damage Sony. Or Nintendo, for that matter, in the Japanese market.

The Japanese developers can't ignore the American or European markets. They are individually bigger than the Japanese market (which is dwindling). They recognize that Xbox has a growing userbase, especially in the U.S., and it would be silly to just ignore that customer base.

I don't have the gift of telling the future so I'm not going to touch the rest of what you said.

[A Black Falcon]

Of course it's not cheap in the sense that they're just giving it away, but in the sense that Microsoft learned from their mistake with the Xbox. Microsoft has been forking out a huge amount of money for the GPU, and the deal they made with Nvidia concerning the royalties has proven to be one of the most expensive parts in the Xbox.

This time Microsoft owns all the tech themselves (they're not licensing it from the GPU maker). All they pay for this time is the production costs, and that will get cheaper over time (MS expects annual cost reductions). The royalty fee they were paying Nvidia never budged.

Plus, they are making the customer pay for the harddrive this time.

Sure, those things are all true, but they're still going to lose money on each system sold. Maybe not as much as they lose on X-Box, but a good amount. And almost certainly more than Nintendo will (might?) be losing on Revolutions. :)

Also, MS isn't losing money just because of hardware costs... it's also because of marketing -- MS has spent massive amounts marketing the X-Box, much more than Nintendo, but without Sony's marketshare to help make up for it... that's been a big drain. They're hoping for more marketshare this time of course with the early launch and stuff, and we'll see...

There's also the fact that like Sony they don't have nearly the first-party-titles focus Nintendo has (that brings in so much by so much focus on the titles that make them the most money), of course.

The Japanese developers can't ignore the American or European markets. They are individually bigger than the Japanese market (which is dwindling). They recognize that Xbox has a growing userbase, especially in the U.S., and it would be silly to just ignore that customer base.

True, but most people make games for their own market... figuring out what some other market wants isn't easy. Of course, you don't always know what your market wants, but you know better than what some other market wants... anyway, they don't totally ignore the Western market -- did you notice how Iwata said (in an interview I posted at TC a few days ago) that Western developers (and FPSes) were a big reason behind the 'nunchuck' controller, and that Western developers started liking the Revolution a lot more after they saw the nunchuck and not just the freestyle ('remote') part of the controller? -- but they definitely focus far, far more on the Japanese market than the American. Like Nintendo says it wants to win, and in the US as well as Japan, but they've always put more effort into winning in Japan, and more importantly their methods of trying to win are tailored for that market and not ours...

As for MS, they of course are doing the reverse... it should have more success than the Xbox in the short term in Japan if just because it's the first and this holiday season it's the best console on the market, but long term? We will see.

(as for ignoring the userbase, look at third-party games... there are a lot of (Japanese-developed) games that are PS2-only that, I bet if they had come from American developers, might have ended up 'PS2 and Xbox'...)

I don't have the gift of telling the future so I'm not going to touch the rest of what you said.

Oh come on, what's the fun of talking about future consoles if you're not going to speculate? That's the whole point of talking about them, really... :)

[EdenMaster]

It's been there since I made the avatar several months ago. Can you guess who's head that is? ;)

I'm going to say...some Sony exacutive. I dunno.

[The Former DMiller]

That's Ken Kutaragi isn't it?

[Great Rumbler]

Looks like it.

[Paco]

That's Ken Kutaragi isn't it?

Yes.

Sure, those things are all true, but they're still going to lose money on each system sold. Maybe not as much as they lose on X-Box, but a good amount. And almost certainly more than Nintendo will (might?) be losing on Revolutions.

Also, MS isn't losing money just because of hardware costs... it's also because of marketing -- MS has spent massive amounts marketing the X-Box, much more than Nintendo, but without Sony's marketshare to help make up for it... that's been a big drain. They're hoping for more marketshare this time of course with the early launch and stuff, and we'll see...

There's also the fact that like Sony they don't have nearly the first-party-titles focus Nintendo has (that brings in so much by so much focus on the titles that make them the most money), of course.

Of course they will lose money on every system sold, just like every other console that has ever come to existence, but this time Microsoft has a strategy to reduce the cost, break even, and then profit from their hardware in the shortest time possible (annual cost reduction). That is why they've gone to such lengths as to take control over all the technology in the Xbox 360 (no royalties due), create a larger profile of first-party games (cause software is where the money is made), and getting ALL games Xbox Live aware to make more of an incentive to get people on the service.

True, but most people make games for their own market... figuring out what some other market wants isn't easy. Of course, you don't always know what your market wants, but you know better than what some other market wants... anyway, they don't totally ignore the Western market -- did you notice how Iwata said (in an interview I posted at TC a few days ago) that Western developers (and FPSes) were a big reason behind the 'nunchuck' controller, and that Western developers started liking the Revolution a lot more after they saw the nunchuck and not just the freestyle ('remote') part of the controller? -- but they definitely focus far, far more on the Japanese market than the American. Like Nintendo says it wants to win, and in the US as well as Japan, but they've always put more effort into winning in Japan, and more importantly their methods of trying to win are tailored for that market and not ours...

As for MS, they of course are doing the reverse... it should have more success than the Xbox in the short term in Japan if just because it's the first and this holiday season it's the best console on the market, but long term? We will see.

(as for ignoring the userbase, look at third-party games... there are a lot of (Japanese-developed) games that are PS2-only that, I bet if they had come from American developers, might have ended up 'PS2 and Xbox'.)

I don't agree. Japanese-made games sell alot in places other than Japan. Resident Evil, Final Fantasy, Metal Gear, et al have proven that Japanese developers can do well in the states. Why wouldn't they try to tap into that market?

The gap between MS and Sony as for who has the most third party exclusives is closing.

Why are we bringing up Nintendo? They are in third place, and from the looks of it they'll stay there. All analyst have Nintendo pegged as losing more market share this next go-round, Microsoft gaining ground, and Sony eventually taking first place.

We'll see.

[A Black Falcon]

Of course they will lose money on every system sold, just like every other console that has ever come to existence, but this time Microsoft has a strategy to reduce the cost, break even, and then profit from their hardware in the shortest time possible (annual cost reduction). That is why they've gone to such lengths as to take control over all the technology in the Xbox 360 (no royalties due), create a larger profile of first-party games (cause software is where the money is made), and getting ALL games Xbox Live aware to make more of an incentive to get people on the service.

Every console to come into existance? Then why does Nintendo make such a big deal about not losing money on hardware... and why is Sony selling PS2s, which by now are very cheap to make, for $150? Yeah. They're not exactly losing money on that one anymore. Yes, most consoles are money-losers to sell when new (not all, but most). But they over time get to the point where they start making money... usually. That didn't happen for Xbox because of high costs... so yes, they are trying to lower them this time. Will it work? Somewhat I'm sure, but who knows how long it'll be until MS is actually making money off X360 sales... they'll have to rely on software sales, and since their first-to-third party ratio is a lot closer to Sony's than Nintendo's, that won't make them as much as they need, unless X360 is a huge hit... I don't see them making money soon, on a consistent basis.

I don't agree. Japanese-made games sell alot in places other than Japan. Resident Evil, Final Fantasy, Metal Gear, et al have proven that Japanese developers can do well in the states. Why wouldn't they try to tap into that market?

Some do, some don't. Nintendo is closer to 'don't', I would definitely say. Oh, there are exceptions, like Metroid Prime and the 'nunchuck' controller addon (statedly primarially for FPSes), but overall? Nintendo thinks of Japan first, designs their product, and then tries to figure out how they can spin whatever they're doing to be attractive in the rest of the world too. Why else would the GC have such a total lack of online gaming? Yeah, because online is more popular in the US than in Japan...

The gap between MS and Sony as for who has the most third party exclusives is closing.

Why are we bringing up Nintendo? They are in third place, and from the looks of it they'll stay there. All analyst have Nintendo pegged as losing more market share this next go-round, Microsoft gaining ground, and Sony eventually taking first place.

Analysts have never been right, and relying on them is not really a way to win points... 'all analysts think Nintendo will fail'? Well, one analyst said so, but since when do they have any credibility? Nintendo has a good opportunity here and could be very, very successful in Japan. The rest of the world? We just don't know. It really depends on the games. But counting them out already is quite foolish... GC did lose ground from where they were with the N64, but I think they can make that back. :)

[Paco]

Every console to come into existance? Then why does Nintendo make such a big deal about not losing money on hardware... and why is Sony selling PS2s, which by now are very cheap to make, for $150? Yeah. They're not exactly losing money on that one anymore. Yes, most consoles are money-losers to sell when new (not all, but most). But they over time get to the point where they start making money... usually. That didn't happen for Xbox because of high costs... so yes, they are trying to lower them this time. Will it work? Somewhat I'm sure, but who knows how long it'll be until MS is actually making money off X360 sales... they'll have to rely on software sales, and since their first-to-third party ratio is a lot closer to Sony's than Nintendo's, that won't make them as much as they need, unless X360 is a huge hit... I don't see them making money soon, on a consistent basis.

Nintendo does lose money at first, just like everyone else. They make it back through cost reduction on hardware and software sales.

Microsoft lost alot of money on the Xbox due to the harddrive and the royalties due to Nvidia. They won't have this problem going into the next generation, and they've built the 360 with cost reduction in mind. I don't know how long it will take them to make money, but I bet you couldn't tell me how long it will take Nintendo and Sony either.

We'll have to wait and see for all three companies, won't we?

Some do, some don't. Nintendo is closer to 'don't', I would definitely say. Oh, there are exceptions, like Metroid Prime and the 'nunchuck' controller addon (statedly primarially for FPSes), but overall? Nintendo thinks of Japan first, designs their product, and then tries to figure out how they can spin whatever they're doing to be attractive in the rest of the world too. Why else would the GC have such a total lack of online gaming? Yeah, because online is more popular in the US than in Japan...

Then that's not a very solid arguementative peice then is it?

Nintendo thinks of Japan first, huh? Maybe that's why they are in third place.

Analysts have never been right, and relying on them is not really a way to win points... 'all analysts think Nintendo will fail'? Well, one analyst said so, but since when do they have any credibility? Nintendo has a good opportunity here and could be very, very successful in Japan. The rest of the world? We just don't know. It really depends on the games. But counting them out already is quite foolish... GC did lose ground from where they were with the N64, but I think they can make that back. :)

They've never been right but I'm supposed to take your word over theirs?

Why are we having this discussion?

[A Black Falcon]

Then that's not a very solid arguementative peice then is it?

Nintendo thinks of Japan first, huh? Maybe that's why they are in third place.

In Japan they're not... actually, going by the weekly sales charts (and including handhelds), they're in first... overall in Japan (total sales) they're probably in second, though it's probably close. :)

The US? Well, again it depends on if you count handhelds... if you don't they're in third, but if you do I'm sure they're ahead of MS. GBA and DS are very successful systems... PSP? Yes, in the US PSP is beating DS, but with the release of Nintendogs DS sales picked up. Now if they can keep that going with the release of some of the other successful market-expanding DS titles they released in Japan (Brain Training, etc)...

They've never been right but I'm supposed to take your word over theirs?

Huh? No, you should make your own argument, and not rely on analysts for "help"...

Nintendo does lose money at first, just like everyone else. They make it back through cost reduction on hardware and software sales.

They lose less.

[Paco]

In Japan they're not... actually, going by the weekly sales charts (and including handhelds), they're in first... overall in Japan (total sales) they're probably in second, though it's probably close. :)

The US? Well, again it depends on if you count handhelds... if you don't they're in third, but if you do I'm sure they're ahead of MS. GBA and DS are very successful systems... PSP? Yes, in the US PSP is beating DS, but with the release of Nintendogs DS sales picked up. Now if they can keep that going with the release of some of the other successful market-expanding DS titles they released in Japan (Brain Training, etc)...

Can't count handhelds since MS isn't in that race. Actually, Xbox sales are steady while the Gamecube has more or less flatlined.

Huh? No, you should make your own argument, and not rely on analysts for "help"...

Is it because they support my arguement and go against yours? I mean, if all we're doing is speculating then I should be able to use an analysts' speculation, no?

They lose less.

That's not a given for this upcoming generation. We don't know what the loss is for any of the consoles yet, and until we do know I really don't feel like arguing on it.

[Great Rumbler]

Actually, Xbox sales are steady while the Gamecube has more or less flatlined.

Ever seen the Japanese sales charts? Xbox sold around 89 units last week.

[A Black Falcon]

Can't count handhelds since MS isn't in that race. Actually, Xbox sales are steady while the Gamecube has more or less flatlined.

Of course handhelds count. It's annoying how many people want to leave them out in order to skew the statistics away from the way they really are, to prove their "points"... (wanting to leave out handhelds is very common among people who want to show Nintendo as losing, I would say) and it's no more true now than it ever has been, especially with Sony's entry into the race with the PSP. Handhelds matter... and right now? Nintendo has the lead because of the massive success over the years of the GBA, but while in Japan Nintendo is clearly leading sales, I'm not sure about the US... haven't seen specific numbers recently. I just know that Nintendogs has helped sales and pushed the DS to at least even with PSP (it had been behind on week-to-week sales, not I have no idea how the total sales compare...), and probably ahead, at least for a while. Anyway, PSP and DS are close worldwide... the key component is that the DS is only half of Nintendo's handheld business, so Nintendo is still clearly winning because of the GBA. :)

Is it because they support my arguement and go against yours? I mean, if all we're doing is speculating then I should be able to use an analysts' speculation, no?

Sure, and I should be able to point out how often they're wrong... and in this case, how they seem to be completely misunderstanding and underestimating Nintendo. They said that they expect the Revolution to have about the same market share as the Gamecube... I (and Nintendo) would consider that to be a failure, and I don't think that it's going to go that way. :)

That's not a given for this upcoming generation. We don't know what the loss is for any of the consoles yet, and until we do know I really don't feel like arguing on it.

It's a safe assumption. MS doesn't care about burning money on X-Box (less yes, but they don't seem to mind some losses). Sony is making money hand over fist off the PS2 and will be for some time. Nintendo? They NEED to make money off all of their systems... they're a smaller company, so they cannot afford to be selling things at a big loss. They don't have infinite supplies of cash on hand, after all... so it's a safe assumption that Nintendo will put more attention into making their business profitable.

Not to mention how software sales help Nintendo dispraportionately more than Sony or MS...

Ever seen the Japanese sales charts? Xbox sold around 89 units last week.

Yeah... :) PS2 sold like 25,000, GC around 2,400 or something, and Xbox like 89. That seems to be about the market share in Japan... PS2 is like 90% of the market, and the GC is the other 10%... I'm not sure what the total numbers are though (if Nintendo's overall GC marketshare is slightly higher).

[Paco]

Of course handhelds count. It's annoying how many people want to leave them out in order to skew the statistics away from the way they really are, to prove their "points"... (wanting to leave out handhelds is very common among people who want to show Nintendo as losing, I would say) and it's no more true now than it ever has been, especially with Sony's entry into the race with the PSP. Handhelds matter... and right now? Nintendo has the lead because of the massive success over the years of the GBA, but while in Japan Nintendo is clearly leading sales, I'm not sure about the US... haven't seen specific numbers recently. I just know that Nintendogs has helped sales and pushed the DS to at least even with PSP (it had been behind on week-to-week sales, not I have no idea how the total sales compare...), and probably ahead, at least for a while. Anyway, PSP and DS are close worldwide... the key component is that the DS is only half of Nintendo's handheld business, so Nintendo is still clearly winning because of the GBA. :)

Comparing console units you CAN NOT count Nintendo's handhelds. It just doesn't make any sense. Now, if you want to talk about each company's business ventures then you can, but I wasn't. Otherwise I could throw in all of Microsoft's other products, but then MS completely decimates the competition.

Console to Console: Xbox > Gamecube

Sure, and I should be able to point out how often they're wrong... and in this case, how they seem to be completely misunderstanding and underestimating Nintendo. They said that they expect the Revolution to have about the same market share as the Gamecube... I (and Nintendo) would consider that to be a failure, and I don't think that it's going to go that way. :)

But you can't prove they are wrong in this instance. Who's to say they aren't completely on target when it comes to Nintendo? Should I give you, obivously Nintendo biased, more credit? I can't make sense of that either. I can't say they're right and I can't say they're wrong...I'd rather just not say if it's all the same with you.

It's a safe assumption. MS doesn't care about burning money on X-Box (less yes, but they don't seem to mind some losses). Sony is making money hand over fist off the PS2 and will be for some time. Nintendo? They NEED to make money off all of their systems... they're a smaller company, so they cannot afford to be selling things at a big loss. They don't have infinite supplies of cash on hand, after all... so it's a safe assumption that Nintendo will put more attention into making their business profitable.

MS doesn't care about burning money yet they have their new Xbox coming out to more or less replace the current model. They've lost some 4 billion on Xbox and you don't think they are eager to make that back? They are going to certain measures to ensure they don't fall in the same money pits of the original Xbox.

Concerning Sony, I believe I read somewhere that they are losing money and that has something to do with their software division. I can't be sure, and I really don't care. They'll be fine.

Not to mention how software sales help Nintendo dispraportionately more than Sony or MS...



Yeah... :) PS2 sold like 25,000, GC around 2,400 or something, and Xbox like 89. That seems to be about the market share in Japan... PS2 is like 90% of the market, and the GC is the other 10%... I'm not sure what the total numbers are though (if Nintendo's overall GC marketshare is slightly higher).

Software sales is where the big money is made; Microsoft and Sony are both making inroads in that area.

Those GC numbers are a far cry from their N64 and SNES days. That's pathetic considering you say they appeal to their Japanese audience so well or more so...whatever point your trying to get across.

[Paco]

Ever seen the Japanese sales charts? Xbox sold around 89 units last week.

Of course I've seen the Japanese sales charts, and I was obviously referring to the NA sales.

[Great Rumbler]

NA sales don't account for everything.

[A Black Falcon]

Comparing console units you CAN NOT count Nintendo's handhelds. It just doesn't make any sense. Now, if you want to talk about each company's business ventures then you can, but I wasn't. Otherwise I could throw in all of Microsoft's other products, but then MS completely decimates the competition.

I've had variations of this argument with people here before, but I maintain that handhelds are consoles. Sorry. :) GBA and DS aren't completely seperate business ventures, they're just different platforms for Nintendo to release its games on (and try to innovate with, both in hardware and software)... saying 'because it's handheld it doesn't matter as much' is wrong. Yes, they are somewhat different markets in some ways, but this does not mean that they should be discounted or ignored.

Of course, that also means that Sony's side includes PSP stuff as well as PS2 ones, so it's not just for Nintendo that I say this... its just MS that is left out. :)

Console to Console: Xbox > Gamecube

Worldwide sales-wise? Yes... but barely. The difference is small.

But you can't prove they are wrong in this instance. Who's to say they aren't completely on target when it comes to Nintendo? Should I give you, obivously Nintendo biased, more credit? I can't make sense of that either. I can't say they're right and I can't say they're wrong...I'd rather just not say if it's all the same with you.

But what do YOU think? What's your opinion on how successful Nintendo will be at expanding the market with the Revolution? That's what's most important here...

MS doesn't care about burning money yet they have their new Xbox coming out to more or less replace the current model. They've lost some 4 billion on Xbox and you don't think they are eager to make that back? They are going to certain measures to ensure they don't fall in the same money pits of the original Xbox.

Concerning Sony, I believe I read somewhere that they are losing money and that has something to do with their software division. I can't be sure, and I really don't care. They'll be fine.

MS: They want to make money, but it's not necessary. They'll do things to try to make more, but losing more won't force them to take drastic action... MS is a very wealthy company. Sony, though... I have heard that they've had some problems, and that they rely heavily on the Playstation for profits... for them it's very important that the PS3 succeeds and they maintain their domination, so they'll do quite a bit to keep that... Nintendo? They'll be fine (that is, profitable). The only question is if they'll move up again or just sit where they are... and I can hope, but obviously we don't know yet.

Software sales is where the big money is made; Microsoft and Sony are both making inroads in that area.

Those GC numbers are a far cry from their N64 and SNES days. That's pathetic considering you say they appeal to their Japanese audience so well or more so...whatever point your trying to get across.

PSX owns the market everywhere... with X-Box in second in most territories and GC in second in Japan. The main impact is that Xbox was a total failure in Japan, so virtually all of Nintendo's sales there make up on the deficit they have in most other regions... which is a big part of why they're not at all far behind on total units sold worldwide. :)

But yes, I would say that the GC has seen a continuing erosion of Nintendo's marketshare when compared to the N64, much less the SNES or NES... each one has had less marketshare than the one before it. Let's hope that they've figured out how to reverse that. :)

[Paco]

NA sales don't account for everything.

It's the number one market when it comes to video games with Europe not to far behind, and then Japan in third.

The fact that the North American VG market is growing while the Japanese market is shrinking makes it no wonder that some Japanese developers have taken notice of the Xbox success in NA, and are now developing for the Xbox 360.

I'm not suggesting that Japan is worthless, cause it's not. I'm just saying that they aren't priority one when it comes to the consumer market, the developers on the other hand are vital, and Microsoft has already secured alot of their support because, well, those Japanese developers would be silly to pass up the possible sales on a growing console brand.

[Paco]

I've had variations of this argument with people here before, but I maintain that handhelds are consoles. Sorry. :) GBA and DS aren't completely seperate business ventures, they're just different platforms for Nintendo to release its games on (and try to innovate with, both in hardware and software)... saying 'because it's handheld it doesn't matter as much' is wrong. Yes, they are somewhat different markets in some ways, but this does not mean that they should be discounted or ignored.

Of course, that also means that Sony's side includes PSP stuff as well as PS2 ones, so it's not just for Nintendo that I say this... its just MS that is left out. :)

You want my opinion and I'm giving it to you. I don't agree with you one bit on that subject.

Worldwide sales-wise? Yes... but barely. The difference is small.

Last I checked the difference was several million units. The fact that Microsoft doesn't exist in Japan tells just how much success it has despite not having that market...imagine if it did. Nintendo selling poorly, or not as well as their past console ventures, on their hometurf is just sad.

I'm glad their DS is doing well though, and I have a feeling the next Gameboy will also be a success...for their handheld market.;)

But what do YOU think? What's your opinion on how successful Nintendo will be at expanding the market with the Revolution? That's what's most important here...

My personal take on the subject of Nintendo's next console is that it will achieve niche status success, and when it comes to console sales (that is, those that plug into the TV and have controllers and such, just to clear that up) will be a distant third to MS and Sony.

That's a very premature assessment, but you asked.

MS: They want to make money, but it's not necessary. They'll do things to try to make more, but losing more won't force them to take drastic action... MS is a very wealthy company. Sony, though... I have heard that they've had some problems, and that they rely heavily on the Playstation for profits... for them it's very important that the PS3 succeeds and they maintain their domination, so they'll do quite a bit to keep that... Nintendo? They'll be fine (that is, profitable). The only question is if they'll move up again or just sit where they are... and I can hope, but obviously we don't know yet.

It is necessary that they make money otherwise they'll have to dump the Xbox all together. You can't just ignore a black hole in your bank account. Microsoft has said they are hell bent on making the Xbox a success, and they've taken a path that I believe will lead them to that success. I've already outlined their hardware decisions that differ, and they've gone to great lengths to strengthen their developer relations plus expand their first party offerings. What remains to be seen is whether it all pays off.

I can't speak for the MS execs and their take on how they feel about losing money, and I don't think you can either.

PSX owns the market everywhere... with X-Box in second in most territories and GC in second in Japan. The main impact is that Xbox was a total failure in Japan, so virtually all of Nintendo's sales there make up on the deficit they have in most other regions... which is a big part of why they're not at all far behind on total units sold worldwide. :)

I already said why this doesn't really say anything good about Nintendo. The fact that Xbox sales eclipse Nintendo's without Japan is just plain bad for Nin.

But yes, I would say that the GC has seen a continuing erosion of Nintendo's marketshare when compared to the N64, much less the SNES or NES... each one has had less marketshare than the one before it. Let's hope that they've figured out how to reverse that. :)

I just don't think that the Revolution is the way to go...but I hope I'm wrong.

[A Black Falcon]

I just don't think that the Revolution is the way to go...but I hope I'm wrong.

Since when is expanding the market to include more non-gamers a bad idea? On the contrary, that's the best thing any company could do for this industry... it's not healthy to have such a focus on a comparitively small demographic, and Nintendo's trying to exploit that. Given that Sony and MS are just doing more of the same, I'd say Nintendo is the only one with a chance to change that... and they certainly could, at least in some places. How successful they are at it in the US depends fully on things we don't know... games, marketing, when it launches, etc...

I already said why this doesn't really say anything good about Nintendo. The fact that Xbox sales eclipse Nintendo's without Japan is just plain bad for Nin.

It's not like Nintendo has failed in the US, you know... they've done okay. Maybe not as well as we would have liked, but okay. It is far from the dire situation you seem to be suggesting. Third? They'd tell you they're second, because they (rightly) count handhelds. :)

You want my opinion and I'm giving it to you. I don't agree with you one bit on that subject.

Saying "this console counts and this one doesn't" is absurd.

Last I checked the difference was several million units. The fact that Microsoft doesn't exist in Japan tells just how much success it has despite not having that market...imagine if it did. Nintendo selling poorly, or not as well as their past console ventures, on their hometurf is just sad.

I'm glad their DS is doing well though, and I have a feeling the next Gameboy will also be a success...for their handheld market.

It's not just about the US and Japan you know. You also have to factor in how horribly Nintendo does in PAL regions (with how well Microsoft has done in Austrailia/New Zealand and how abysmally badly Nintendo has done there), for good reasons like 'PAL usually gets Nintendo stuff way late'... Nintendo is doing well in the US when you compare it to how they've done in Austrailia! (and really, they've done okay in the US... not well enough, but okay.)

And yeah, I've heard several million as the difference too, but that's out of a larger number...

It is necessary that they make money otherwise they'll have to dump the Xbox all together. You can't just ignore a black hole in your bank account. Microsoft has said they are hell bent on making the Xbox a success, and they've taken a path that I believe will lead them to that success. I've already outlined their hardware decisions that differ, and they've gone to great lengths to strengthen their developer relations plus expand their first party offerings. What remains to be seen is whether it all pays off.

I can't speak for the MS execs and their take on how they feel about losing money, and I don't think you can either.

I was looking at the past four years and what they've done so far, and extrapolating from there. I highly doubt that their whole philosophy is going to change overnight to a Nintendo-style "profit comes first" one.

My personal take on the subject of Nintendo's next console is that it will achieve niche status success, and when it comes to console sales (that is, those that plug into the TV and have controllers and such, just to clear that up) will be a distant third to MS and Sony.

That's a very premature assessment, but you asked.

You do know that you can play all GB, GBC, and GBA games on a television, right? Makes that definition of "console" kind of useless from your perspective... :)

Anyway, "niche"? I just don't get why people think this... their whole philosophy is heading in the opposite direction, and the success of the DS based on this concept shows how it can work. "Niche"? Not even close.

As they said... you release the games everyone can love, and you also release the games your base of hardcore gamers will love (such as Nintendogs and Advance Wars DS). You do both, and hold on to both groups of customers. You don't assume that the hardcore will ONLY buy your console, but you assume they'll get it for the games you make for it. Which many will, of course. Gamecube? They tried to do this, kinda, but didn't really... having a big "A" button to "simplify the controller" didn't exactly work (and never would, given how it's not really much of a change worth mentioning). So this time they tried a much better idea... 'how about we change the controller as we know it again? (while still having something to keep the hardcore gamers happy)'. :)

[Paco]

Since when is expanding the market to include more non-gamers a bad idea? On the contrary, that's the best thing any company could do for this industry... it's not healthy to have such a focus on a comparitively small demographic, and Nintendo's trying to exploit that. Given that Sony and MS are just doing more of the same, I'd say Nintendo is the only one with a chance to change that... and they certainly could, at least in some places. How successful they are at it in the US depends fully on things we don't know... games, marketing, when it launches, etc...

It's not a bad idea, but having a controller like they do (non-conventional) they've isolated themselves away from more traditional games. Sony has proven what the mass market wants, and Nintendo just seems to [stubbornly] ignore it.

It's not like Nintendo has failed in the US, you know... they've done okay. Maybe not as well as we would have liked, but okay. It is far from the dire situation you seem to be suggesting. Third? They'd tell you they're second, because they (rightly) count handhelds. :)

They are third in the U.S., and they've been selling half of what Xbox has for over a year or so. It's not dire, and I didn't suggest it was, but it does signal them settling more into a niche market. They'll always be around because they are Nintendo, but they've made decisions that alienate them from the current mass market. Perhaps the Revolution will bring in an entirely new consumer crowd (this is what they are hoping), but I don't know.

Saying "this console counts and this one doesn't" is absurd.

If you look at their console, the Gamecube, then compare it with their handhelds, GBA and DS, then there are two very different pictures. Their handhelds enjoy alot of success with nearly every handheld developer on board, but their console is third world wide in terms of sales and continues to lose developer support.

Now, if you were to look at total hardware sold then you would think Nintendo should have every developer on board. That's not the case, and that's because the Gamecube is in third place relative to other consoles. The GBA, on the other hand, continues to sell quite well, and the DS has enjoyed alot of success so more developers are jumping on board.

Handhelds/Portables != Consoles.

It's not just about the US and Japan you know. You also have to factor in how horribly Nintendo does in PAL regions (with how well Microsoft has done in Austrailia/New Zealand and how abysmally badly Nintendo has done there), for good reasons like 'PAL usually gets Nintendo stuff way late'... Nintendo is doing well in the US when you compare it to how they've done in Austrailia! (and really, they've done okay in the US... not well enough, but okay.)

And yeah, I've heard several million as the difference too, but that's out of a larger number...

Okay.

I was looking at the past four years and what they've done so far, and extrapolating from there. I highly doubt that their whole philosophy is going to change overnight to a Nintendo-style "profit comes first" one.

What do you think their philosophy is, exactly?

I think you're thinking in extremes, please don't. You can't ignore the different decisions Microsoft has made concerning the hardware because it would be ignoring the facts. I've already outlined two ways they've cut costs (they own the hardware (no royalties due), and they are making the consumer pay for the HD), two of their biggest headaches concerning the Xbox and that financial fiasco. Let's not forget XNA to help developers along, encouraging them to develop for Xbox 360 and Windows Vista.

Yeah, Microsoft wants money. They've done alot to get attention, and it looks to me like they're getting it.

You do know that you can play all GB, GBC, and GBA games on a television, right? Makes that definition of "console" kind of useless from your perspective... :)

I do know that because I have a GBA player for my GC. It's an add-on to play games from their handheld on their console.

Anyway, "niche"? I just don't get why people think this... their whole philosophy is heading in the opposite direction, and the success of the DS based on this concept shows how it can work. "Niche"? Not even close.

They've long appealed to a Nintendo crowd with their Mario and Pokemon sequels left and right. The DS and Revolution are a step to appealing to a new crowd, but it has yet to be proven just how successful (mainstream) it can get.

As they said... you release the games everyone can love, and you also release the games your base of hardcore gamers will love (such as Nintendogs and Advance Wars DS). You do both, and hold on to both groups of customers. You don't assume that the hardcore will ONLY buy your console, but you assume they'll get it for the games you make for it. Which many will, of course. Gamecube? They tried to do this, kinda, but didn't really... having a big "A" button to "simplify the controller" didn't exactly work (and never would, given how it's not really much of a change worth mentioning). So this time they tried a much better idea... 'how about we change the controller as we know it again? (while still having something to keep the hardcore gamers happy)'. :)

Nintendogs and Advandce Wars are relatively new, and I hope it signals Nintendo's willingness to stop whoring Mario and Pokemon all over the place, and to stop relying on their mega IPs like Zelda and Metroid (which we only see every other year or so). You can't bring in a new crowd without new ideas, characters, and concepts. Not everyone likes Mario, you know.

[Great Rumbler]

It's not a bad idea, but having a controller like they do (non-conventional) they've isolated themselves away from more traditional games. Sony has proven what the mass market wants, and Nintendo just seems to [stubbornly] ignore it.

You can still use GC controllers as well as the tradional controller shell.

[A Black Falcon]

Not necessarially in Revolution games... people just assume that, but Nintendo has not actually said so.

[Great Rumbler]

What? Maybe not the GC controller, but the controller shell definitely.