Microsoft Could Lose $126 per Xbox 360 - Video Games Forum

marksman · #1 (**permalink**) 11-25-2005, 10:27 AM

Wow. So they continue to lose money on them. I thought they might be able to make money with the 360.

Quote:

A new report on industry website Gamasutra.com publishes the findings of a new games industry survey today, revealing that Microsoft could be losing as much as 126 USD per Xbox 360 console sold. At launch, the original Xbox apparently lost about 125 USD per console. The research was produced by electronics firm iSuppli, who found that in the premium (hard-drive equipped console), the components within will cost 470 USD at current market prices. Apparently, these costs, plus those of the wireless controllers, power supply and cables (totalling 55 USD), bring the total loss to 126 dollars per package. That's before you account for the vast costs of distribution and of course Microsoft's hyperactive marketing department.

Reporting on the budget price pack, sold most notably sans hard-drive, iSuppli is reporting a loss of some 26 USD per pack, though Gamasutra.com notes that several other experts have estimated a loss in excess of this figure. Business Week meanwhile are quoted as citing an unnamed source within Microsoft, who apparently reveals that the Xbox division are hoping to break-even by the end of 2006, with profits from games sales and lower hardware costs hoped for in 2007. Of course, much will depend on the success of the Xbox 360 in the upcoming battle with the Sony PS3 not to mention the Nintendo Revolution. The PS3 is also expected to be sold at an initial loss, potentially a very high one, given the expense of Sony's new Cell CPU powering the forthcoming console.

http://www.ferrago.com/story/6911

Guru · #2 (**permalink**) 12-03-2005, 12:24 AM

When all comes to all they will fix the problem people will start buying them for wayyy cheaper and it will be all good.

FaithZ · #3 (**permalink**) 12-03-2005, 12:52 PM

These peopel have market strategies hardly ever do big businessed totally fail on something.

Feirce_Deity · #4 (**permalink**) 01-17-2006, 10:43 PM

Companies like Microsoft, Nintendo and Sony usually make most of their profit off the games then, right?

SeanyJ · #5 (**permalink**) 01-19-2006, 09:11 PM

Yeah, they will make all of their money off the games and the accesories for the system. They lost money on the X-Box system itself as well so they know what they are doing.

llkooldudell45 · #6 (**permalink**) 02-04-2006, 02:52 PM

Wow, I have heard about this, ya they make alot of money from games but, how do they make a profit with so many loses? Is this with all systems? Lose money on the actual system, but make it with games?

Marapets.com · #7 (**permalink**) 05-10-2006, 05:39 AM

wow that sucks! i heard google lost about 56 million aswell

sunnyshadow · #8 (**permalink**) 09-27-2006, 08:18 PM

who in here likes inuyasha

princee18 · #9 (**permalink**) 08-09-2008, 02:45 AM

Yeah they have their own stratagies. they sell xbox in cheaper rates and increase the prices of the games and other accessories. So, they earn most of their income from there.

molly00000 · #10 (**permalink**) 08-14-2008, 05:25 AM

People just cant understand their business strategies, we all are like pawns and they play with us to make big profits and claim to only entertain us.