If you include the 1st generation, you may well be correct. But the 2nd generation has been profitable.
And that first generation as a loss-leader was essential to produce the results of this current (and future) generations. So that seems far less like a loss than it does an investment.
Truth is, every company in the hardware space (Apple, Microsoft, Sony, and lesser companies like Tivo) all understand that when it comes to moving hardware units, we've got them in the cubicles first, then the home offices, then the bedrooms. The big untapped markets are the living rooms, pockets and cars.
And it seems obvious as anything to me that the xBox, PS3, etc, are not about gaming consoles. They're about getting a multimedia PC attached to your TV. Gates saw this as the next big thing 15 years ago. That's why they bought WebTV! Microsoft and a score of other companies have determined that the living room will be a very profitable market and they've been willing to drop a few dollars to get there.
>> "They're about getting a multimedia PC attached to your TV."
The problem is, the xBox is absolutely unusable as a media thing. It's ridiculously noisy, big, and useless. A mac mini beats it hands down. Or any small lightweight PC. The xBox still doesn't even have a browser for the love of god. We live in a time when new calculators probably have web browsers included.... but not the xBox.
I've used the Xbox to watch media almost every day since the day it launched. I download all my files through bittorrent, stream them to the Xbox. I also use PlayOn to let me watch Hulu there.
It's not too noisy if you have the latest version and aren't running a DVD. A Mac Mini is not better (though it is smaller and quieter) and it's significantly more expensive and harder to use for living room applications. I know because I tried.
The Wii has a browser, and I've used it once and then only to check it out. Wtf would I want a browser on my TV for? All the Xbox needs is a YouTube app, and then there'd be no reason for one.
I have wii, xbox, mac mini hooked up in the living room.
wii: family games (Agreed, the browser is crappy, no keyboard, etc), but games are best for kids/family.
xbox: guitar hero, good if someone wants to shoot random stuff or do real racing games.
mac mini: browser, youtube, photos, play backed up dvds, movie trailers, itunes, etc etc.
IMHO The UI in the xbox isn't good, and their insistance on reimplementing the web in 'apps' isn't one that I agree with - facebook, twitter integration? Just use a browser. I just simply can't stand to use the xBox more than is really necessary. It's painful :/ Whilst everyone else is moving towards the web as a platform, Microsoft still seems to think the web is irrelevant.
And that first generation as a loss-leader was essential to produce the results of this current (and future) generations. So that seems far less like a loss than it does an investment.
Truth is, every company in the hardware space (Apple, Microsoft, Sony, and lesser companies like Tivo) all understand that when it comes to moving hardware units, we've got them in the cubicles first, then the home offices, then the bedrooms. The big untapped markets are the living rooms, pockets and cars.
And it seems obvious as anything to me that the xBox, PS3, etc, are not about gaming consoles. They're about getting a multimedia PC attached to your TV. Gates saw this as the next big thing 15 years ago. That's why they bought WebTV! Microsoft and a score of other companies have determined that the living room will be a very profitable market and they've been willing to drop a few dollars to get there.