“Particularly from an investment perspective,” says Wall Streeter Roger Ehrenberg. Note, this doesn’t mean the Xbox has been a disaster for gamers — far from it (cough, cough Halo) — but Ehrenberg makes a strong case that the Xbox has failed investors by hemorrhaging Microsoft’s Home & Electronics profits. He also believes that when a console fails in Japan, as the 360 appears to have done, it cannot succeed in the world market (Caveat: NEC’s PC Engine did very well in Japan, and Japan alone).
From the article: “Microsoft needs to take a long, hard look at its gaming strategy – and, in fact, its entire H&E strategy. At what point, regardless of its virtually endless financial resources, does it say ‘enough is enough.'”
Independent of which platform(s) you enjoy, there have only been two profitable hardware makers in the video game industry over the last 7 years: Sony and Nintendo. It makes you wonder if the only reason we have a three player landscape right now is by way of ambitious, unwavering, and deep Microsoft pockets. Is it possible that Microsoft could say “enough is enough” someday, effectively throwing in the console towel? I don’t see it happening, but I suppose if shareholders grow tired of accrued losses, anything’s possible.
[Thanks, Robert]