The Xbox is getting creamed....

[AIM]

Check it out:

http://news.com.com/2100-1040-938990.html?tag=fd_top


"Original financial estimates for the Xbox console had it losing a total of $900 million over eight years. However, sales of the the Xbox have been staggeringly low compared to the initial projections and have fallen behind the revised projections issued earlier this year. Because of those low sales and the recent price cut per unit from $299 to $199, the Xbox is expected to lose a minimum of $750 million this fiscal year alone, and may easily lose another $1.1 billion next fiscal year. In order for the Xbox to survive, Microsoft will have to not only cut component costs from $325 per unit to $225 over five years, but increase game unit sales, which have also under performed dramatically compared to initial projections."

Wow... Microsoft might lose a minimum of $750 million this year alone :!:

and....

1.1 billion next year :!:

doesn't look good.... :shock: :shock: :shock:

[Dave Long]

I sent this link to Tom this morning.

http://www.redherring.com/insider/2002/0624/xbox062402.html

That's where this story comes from. It sounds really nasty. In the no Spaceworld thread someone said your stock gets beat up even if you've got money in the bank when you're "losing" in a market. Let's see if that holds true.

--Dave

[noun]

Yeah, but check this out:


The losses aren't unexpected, but they do show that Microsoft expects to lose more money the more machines it sells. When Bill Gates approved the Xbox in the fall of 1999, he was told that the console could lose $900 million over eight years and that if Sony cut its prices aggressively, then Microsoft could lose $3.3 billion.

So it's not necessarily the loss that might trouble Microsoft, but the fact that they reached their projected target so quickly.

I know it's standard for the console industry, but I'm still blown away by the "we lose money on every unit but we make it up in volume" business logic.

[Sean Tudor]

Wow... Microsoft might lose a minimum of $750 million this year alone :!:
and....
1.1 billion next year :!:
doesn't look good.... :shock: :shock: :shock:

What can I say about this whole Xbox fiasco ? A big LOL!

[Enkidu]

In the no Spaceworld thread someone said your stock gets beat up even if you've got money in the bank when you're "losing" in a market. Let's see if that holds true.

--Dave

I think it's a more complicated issue with the Xbox than for Nintendo (in the Spaceworld thread). Microsoft has other businesses, and has done a fairly good job of managing expectations around short-term performance of the Xbox. Microsoft's stock price has considerably more influences than just performance of their console gaming effort.

[Derek Smart [3000AD]]

Yeah, but check this out:

So it's not necessarily the loss that might trouble Microsoft, but the fact that they reached their projected target so quickly.


ROTFLMSAO!!! :lol:

funny one, that.

[Desslock]

>Microsoft's stock price has considerably more influences than just performance of their console gaming effort.

No company can lose $750 million, let alone $1.1 billion, and not have its stock price affected. And, in any event, the rest of Microsoft's business isn't doing great either -- Office sales are severely stagnated, WinME sales bombed, and WinXP sales are only doing as expected.

Stefan

[Mark Asher]

Yeah, I would think that even with Microsoft's warchest, if they lose those kinds of numbers it will hurt their stock price.

Employee compensation at MS has been tied in part to stock options in the past. I wonder if their stock price is hurt if that will be hard on employee morale?

They have the added expense of Xbox Live around the corner too. If they don't pull in enough subscribers, that could be more red ink.

[wumpus]

No company can lose $750 million, let alone $1.1 billion, and not have its stock price affected. And, in any event, the rest of Microsoft's business isn't doing great either -- Office sales are severely stagnated, WinME sales bombed, and WinXP sales are only doing as expected.


Microsoft can absorb the Xbox losses. The company has an estimated $42 billion in cash reserves and, for the year ending June 30, it is expected to report a net profit of about $10 billion and revenues of $28.25 billion.
You have to spend money to make money. As Mark Asher almost never points out, without installed base you're screwed.

[wumpus]

funny one, that.
I see you've joined Andrew Bub's annoying "let's pretend we're British" club. Congratulations.

[Bub, Andrew]

I am British. Hence the last name you ponce.
You think I was born in Milwaukee?!

[Sparky]

funny one, that.
I see you've joined Andrew Bub's annoying "let's pretend we're British" club.

Ah, Wumpus shows his true colours...genteel manners are thin on the ground here. But hang about! You naffing wanker, I shall bloody well smite you with a perishing heavy volume of something by P.G. Wodehouse! Take that back posthaste or I shall make a dog's breakfast of you, you dashed chutney ferret! Cor blimey! Pip Pip! Tom Baker is the best Doctor Who ever! Cheerio!

[GMicek]

funny one, that.
I see you've joined Andrew Bub's annoying "let's pretend we're British" club.

Ah, Wumpus shows his true colours...genteel manners are thin on the ground here. But hang about! You naffing wanker, I shall bloody well smite you with a perishing heavy volume of something by P.G. Wodehouse! Take that back posthaste or I shall make a dog's breakfast of you, you dashed chutney ferret! Cor blimey! Pip Pip! Tom Baker is the best Doctor Who ever! Cheerio!

Haha, that reminds me of Develop Magazine. Great magazine, but it's extremely British. So every now and then i'll read something and not have a clue whether what they're saying is good or bad.

[Mark Asher]

Wumpus is pants!

[Mark Asher]

"You have to spend money to make money. As Mark Asher almost never points out, without installed base you're screwed."

Of course, but the gist of this thread is that Microsoft looks to lose much more money than anticipated.

So, tell us how this is a good thing? Mark Asher would like to know, so he can point out in the future how significantly higher losses = goodness.

[Kool Moe Dee]

Wumpus is pants!

Whereas Mark and Tom are the dog's bollocks. :wink:

[Enkidu]

No company can lose $750 million, let alone $1.1 billion, and not have its stock price affected. And, in any event, the rest of Microsoft's business isn't doing great either -- Office sales are severely stagnated, WinME sales bombed, and WinXP sales are only doing as expected.

Stefan

Agreed. Microsoft's price is currently more than 30% off the 52-week high. Still, they have an extremely large cash position, and very significant other businesses. I don't think anyone on this board thinks that equity pricing (especially in technology stocks) has been very rational, so as long as people can rationalize the Xbox expenses as an investment rather than a loss, they may not penalize Microsoft so heavily. If a consensus is reached that the Xbox is no longer viable, then it will be interesting to see what the markets do.

[Enkidu]

Hmmm... Forgot to say, "Cheers!"

[Dave Long]

Microsoft's stock price has considerably more influences than just performance of their console gaming effort.

...and Nintendo's stock price is driven by more than just Gamecube. They're the leader in handhelds (the only player), and even Microsoft is licensing their properties to THQ to get them on the GameBoy Advance. Nintendo also still sells a ton of Pokemon stuff and we haven't even seen Pokemon for Gamecube yet.

If I'm not mistaken, Hamtaro is a Nintendo property as well. If that takes off on Cartoon Network, you've got another property of theirs doing well. They've got a Kirby anime coming to America this Fall too. They're not just living room consoles either.

But then I see you're backpedalling already after the almighty Desslock spoke.

--Dave

[Enkidu]

But then I see you're backpedalling already after the almighty Desslock spoke.

--Dave

Huh? You mean me? What?

[Rob de los Reyes]

I think the point is that it's still possible to take a sanguine view of Microsoft's venture precisely because other areas of the computer industry are suffering. The one tech area that has been resilient despite an industry beating and a general economic slowdown is the console game market. I realize there are more than a few "if"s here, but if you think Microsoft's traditional business lines are becoming commoditized and if you think the console market has growth prospects than range into the decades, then you see Microsoft as doing what large companies are notoriously bad at doing--changing with the times. Microsoft has also started making some rumblings in the wireless market. So far, wireless has been more hype than profit, but if you believe in the projected growth figures, then who better to ride out the awkward (and costly) transition to true 3G but a company with inordinately deep pockets? And I'm still oversimplifying.

Nintendo's a different matter. First of all, being the leader in handhelds means little if you're the captain of a sinking ship. If you believe the current projections (if if if), Game Boy type devices are not the future. Maybe that's because people think pocket computers and advanced mobile phones will offer a better total package. I have no idea. The current leadership at Nintendo is hinting at a Sega-style retreat to pure "content," as it were (which may include other media). If they do that, then it's not hard to see Mario Party 6 for the Xbox the same way you have Sonic for the GameCube -- and Microsoft is back in business. So here's the other if -- maybe you think the punishing losses on the Xbox are likely to send a signal to Nintendo that it's in an arms race it can't win (but Sony, also wildly diverse, can). In that scenario, too, you can still hold out plausible hope for the Xbox venture.

Gah. It's complicated. And the analysts who do nothing but think about this all day don't seem to have vastly better arguments than those voiced on this board.

[Mark Asher]

The thing about Nintendo isn't so much the Gamecube now but their next console, should they choose to do one. The next round of consoles will probably begin about 2005 with the PS3. For Nintendo to compete with a new system, they will have trouble hitting that $200 price point. The next consoles will likely be more like the Xbox with hard drives and built-in connectivity and maybe (likely) Tivo-ish functionality. Is Nintendo going to have the stomach for competing in a more expensive hardware market for consoles?

[Sparky]

If I'm not mistaken, Hamtaro is a Nintendo property as well.

Yup, it's theirs -- in fact, I discovered Hamtaro after seeing a wacky poster for it at E3 (naturally, I set my Tivo on "stun", or rather "record", which is one button down from "stun" and slightly to the left of "KILL"). Whoa. Watching Hamtaro is like being high, without actually being high...if being high involves a *lot* of giggling and seeing overly-enthusiastic talking rodents wearing hats, which I suspect it does for many people.

[Desslock]

>after the almighty Desslock spoke

Hey, that's better than being called an English-wannabe.

[Dave Long]

For Nintendo to compete with a new system, they will have trouble hitting that $200 price point.

But that's the point I'm trying to make, Mark. Nintendo isn't following suit with the others. Online isn't their goal. Making an all-in-one box isn't their goal. Given that the Gamecube is already cheaper than the other two, and it clearly is made for games and nothing more, why wouldn't they release another console in four years that's similar? There's no pressure to diversify...they've got the game content. Making a console for $200 that just plays games won't be difficult in 4 years. Hell, with costs of hardware so cheap these days per wumpus, we should see an Xbox1 costing like $50 or less to make with high end hardware only costing maybe $100 more. :)

I've said it a hundred times on this board and it's been repeated in the press thousands of times. Set top boxes haven't been a success and convergence may not be realistic in the next five years or ever. People aren't bitching and moaning about buying a console for games and a stereo for music and a DVD player for movies. People also like buying things in stores and broadband delivery of product directly over a wire isn't that appealing to the majority of consumers. You don't "own" anything and that's what people don't like. You have complained in the past about getting bills for internet usage if that would be the way it went to access sites via small payments. Well...consider paying to play your games, watch your movies or do anything electronic in the same way. How many are going to want to do this? I know I'm not a big fan of pay-per-view films as they exist today (and it's bloody (note British word usage) easy to watch them that way), yet that seems to be the goal of Sony and Microsoft with games.

Anyway, I think people are crazy if they think Nintendo will just bow out of hardware and only make software. Sega was a different story. They had no money left and only one option to save their company. Nintendo isn't even close to that. They're the Disney of gaming and they won't be going away anytime soon.

--Dave

[Anonymous]

oh yeah, poor struggling Microsoft. When their fiscal year closes on June 30th, they're going to announce revenues of over $28 billion and a profit of over $1.50 per share (somewhere in the neighborhood of $10-12 billion).

I love how Microsoft gets put under a microscope on these matters more than other companies. When Sony spent SEVERAL BILLION DOLLARS to make a fabrication plant to produce their own PS2 graphics chips, putting them several billion in the red before the first system was sold, nobody mentioned a thing. When they proved they couldn't run a fab well and the yeilds sucked so bad there was a huge PS2 shortage, nobody seemed concerned. Now that they've sold the fab (at a loss) and are paying the new owners to produce the PS2 graphics chips, it's not worth crowing about. But MS loses a perfectly reasonable amount on the first two years of Xbox sales, and it's the end of the world.

I mean c'mon here guys, do the math! They sell 10 million Xboxes this year, lose say $100 per unit, that's a billion dollar loss right there. Since they're probably losing more like $150 or more per box with the reduced price, plus a big marketing budget... Is a loss of 3/4 of a billion a surprise to anyone? It takes three years of software sales for the consoles to start to pay for themselves, and five years to make big money. (see the "Xbox is 2006" thread).

[Dave Long]

They've already revised the projections down for the first half of 2002, Jason. They'll only be at 3.5 to 4 million by the end of this fiscal quarter if they're lucky. How do you think they're going to turn the rest of 2002 into another 6-7 million systems sold?

I think they will be lucky to double their system count by the end of the year worldwide. Japan is lost to them. New games hardly register on the sales charts. Rallisport just debuted to 2000 copies sold in its first week. Europe isn't much better. In the US, sales have slowed. It's already over for them to make the "big money" five years out.

--Dave

[JeffL]

FWIW, I'm also in the skeptical camp when it comes to the convergence into an all-in-one box. We do a bit of work in developing materials and technical solutions for the electronics markets, and for whatever its worth, I just don't see this as being an unmet need that the marketplace is screaming for. I do see it as an inside-out driven push on the part of folks like Microsoft, as they seek new markets. Convergence in the cell phone market is VERY real and very driven by people clamoring for it. Combining paging, messaging, email, internet connectivity, phone, palm-type functionality, etc. in a cell phone package is happening and is gonna keep happening. But I agree with the post above: I just don't see people wanting everything in one set-tops.

[wumpus]

How do you think they're going to turn the rest of 2002 into another 6-7 million systems sold?
Christmas. Console systems never hit their prime until a about year out. History has always proven this to be true-- you need look no further than the PS2.

[Mark Asher]

"But that's the point I'm trying to make, Mark. Nintendo isn't following suit with the others. Online isn't their goal. Making an all-in-one box isn't their goal. Given that the Gamecube is already cheaper than the other two, and it clearly is made for games and nothing more, why wouldn't they release another console in four years that's similar?"

Because in four years online gaming for consoles will be established. It may not be huge, but it will be an important part of the scene.

I think for new boxes to compete they'll need to be able to support online gaming. That will be an important marketing bullet point. Once you get beyond the hardcore, who buy every console, you start competing on price and features and game library. I think a new console that doesn't feature some kind of connectivity built-in will be hardpressed to compete.

Heck, Nintendo is coming out with some kind of online package for the Gamecube, aren't they? They must think it important for the Gamecube to be able to support online gaming.

Anyway, the lower price point on the Gamecube seems to have had little impact on sales. I don't think you can say Nintendo's strategy has been successful.

[wumpus]

Because in four years online gaming for consoles will be established. It may not be huge, but it will be an important part of the scene.
Right. And what is the lesson learned from PS2's large sales figures? Don't give your competitors an 18 month sales lead on a silver platter.

Also, emoticons are annoying. Particularly when all twenty of them are animated RIGHT NEXT TO THE MESSAGE I'M TYPING. Aaaarrrrrrgggghh

[Desslock]

>But MS loses a perfectly reasonable amount on the first two years of Xbox sales, and it's the end of the world

Losing $2 billion in operating revenue, not capital expenses, is a "perfectly reasonable amount"? That's crazy-speak. That's a significant loss even to a Fortune 500 company, even if it's anticipated.

[Rob de los Reyes]

That's the nub, right, mate? (couldn't resist) It's technically a loss out of operating revenue, but the optimists might nevertheless look at it as capital investment, particularly in a market where you know going in that the boxes themselves are going to have to be sold at a loss. The box is just infrastructure you have to build in order to deliver content. You can't book it that way (unless you're WorldCom), but that's how you spin it. I'll steer clear of whether that's the right conclusion, but that's why, I think, this situation is a bit unusual.

[Mark Asher]

"And what is the lesson learned from PS2's large sales figures? Don't give your competitors an 18 month sales lead on a silver platter."

Well, Sega launched the DC before the PS2. I think the real lesson is that if you're already number one, it's much easier to stay number one when you launch a new console.

That said, I think Microsoft would be foolish to not challenge the PS3 with an Xbox 2 right away.

[Dave Long]

If there is one thing Nintendo has proven throughout their entire history, it's that they don't have to play by the rules. N64 was a successful system that used cartridges in a CD generation. It stayed the course, was very profitable and outlasted both of Sega's consoles released in the same time frame. SNES came to market long after Genesis and still managed to sell as much if not more than the clear market leader when SNES emerged.

Nintendo is now saying, "Sure, we'll give you a modem or broadband adaptor to play around with on the Gamecube. We won't stop anyone from developing for it but it's not where we think we need to be." When you look at Zelda, Mario, Metroid, Eternal Darkness and Star Fox, who's to argue? They'll make a lot more money by releasing those games than they would playing the online game. That's especially true in this generation of consoles. You're so hooked on the technology Mark and wumpus, that you guys can't see the forest for the trees. It's the games that are driving things. GTA3, FFX, MGS2 and GT3 sold the PS2. Nintendo's big properties will (and already have) sell the Gamecube. Microsoft is only where they are because of Halo. Without Halo, Xbox would be in even worse condition.

So I don't agree that online will be crucial in the next generation. We're so far from broadband being ubiquitous in both this country and around the world that it simply isn't viable now and probably won't be for another 10 or more years. If the stock market keeps imploding every six months, and since a telecom is right now on the hotseat, I don't see how broadband penetration rates can increase. The IDSA released that report back at E3 which said the same thing it did five years ago. It's pretty much not going to happen anytime soon. Nintendo sees this and is serving the market now and not hoping to serve some market years from now. Given their resources, the properties they own and continue to create, and their love of making great games above all else, they can easily capitalize on online when it's for real and not worry about it now.

But why are you guys so worried about these systems that are four years from now? The ones that are here are pretty damn great and are getting a lot of quality games. Even if Microsoft fails miserably, they've helped drive the market to create better product, which unfortunately has made most of their product look average at best. Captain Obvious pointed out that Christmas is coming and while I don't agree that Microsoft can possibly pull 6-7 million in sales out their ass (if they do that, given current adoption rates, Sony will sell 24 million this Holiday season...shyeah, right), it will certainly increase the installed bases to where developers are going to make some decisions and one of these things will have little support after Jan. 1, 2003. If it does turn out to be Nintendo, which is unlikely given their game lineup, they'll still crank out their exclusive games, remain profitable and they'll be here for the next round.

--Dave

[Mark Asher]

"But why are you guys so worried about these systems that are four years from now?"

Why not? We're just having fun speculating. I'm not worried, just interested in where everything's headed.

[Derek Smart [3000AD]]

funny one, that.
I see you've joined Andrew Bub's annoying "let's pretend we're British" club. Congratulations.

Do you just always just feel like posting nonsensical rubbish or is that part of your neanderthal-like karma?

Either that, or you're not very bright, are you?

I *am* half-Brit yer ignorant git.

Next time, look at the sole of your foot before shoving it in your mouth.

Worse case scenario? Ask first.

[JT]

]
Next time, look at the sole of your foot before shoving it in your mouth.

Does this BBS software have a killfile feature?

[Derek Smart [3000AD]]

]
Next time, look at the sole of your foot before shoving it in your mouth.

Does this BBS software have a killfile feature?

Yep

Don't read. Don't post

If you do read, skip posts you're not interested in.

You'd be surprised at how well that works. Try it.

Anyone who feels compelled to read and/or post, then proceeds to bitch about what is read and/or posted, is just a crybaby.

For instance, I read quite a bit of posts here - and have done since QT3 first came on scene. However, you'd be hard pressed to find a lot of posts from me. I only respond to posts that I am interested in or which are directed at me.

What's your excuse, then? Or did you just want to be heard? Why don't you just step outside and yell at the top of your lungs, then? Same effect. If you wanted to know if the forum had a filter, you'd have looked for it without having to post about it. Yeah, you just wanted to be heard.

But then again, you have a penchant for posting stuff like these (http://www.quartertothree.com/phpBB2/search.php?search_author=JT), so I'm not surprised.

[JT]

Might I direct you to this, before it's too late?

http://images.amazon.com/images/P/0671723650.01._PE_SCMZZZZZZZ_.jpg

Or this?

http://images.amazon.com/images/P/0898048044.01._PE_SCMZZZZZZZ_.jpg

Or this (most important):

http://www.gamespot.com/features/bestworst96/disappointing.html

[Tyjenks]

Might I add:

OUCH :!:

[Jason Cross]

As we sit here and speculate about the state of Xbox and other consoles, let's maybe try to dig up some info...

How much money did the PS2 lose in the fiscal year that ended earlier last year?

How much money will Nintendo lose this fiscal year on Gamecube sales? Is it possible to seperate that out from Gameboy Advance (which doesn't lose money)?

When are Sony and Nintendo expected to launch their next console systems?

[Anonymous]

I am British. Hence the last name you ponce.
You think I was born in Milwaukee?!

Hah! Oh what a giveaway.

If you were actually "British" you'd never use that word. You'd claim to be English, Scottish, or Welsh.

Erin go bragh!

[Mark Asher]

Sony looks like 2005 for the PS3. No idea about Nintendo.

Sony may have been breaking even or making money on the PS2 at $299 at some point last year. Hard to say since most of it's guarded information. At $199 I haven't heard anything. It's possible they still might be breaking even or making a profit. They did some kind of hardware consolidation in the design to save money.

Kind of amazing they can sell the PSOne at $49. They wouldn't be selling that system at a loss. They must make a small profit on it.

Did that dispute between MS and nVidia ever get settled?

[Jason Cross]

Okay, here's what I found.

According to this:
http://www.sony.co.jp/en/SonyInfo/IR/financial/ar/2001/A-Glance.html

Sony lost 51 billion yen (roughly $500 million US) in Fiscal Year 2001 in the games business, which ended March 31, and included those PS2 sales except for the first 1.5-2 million sold in Japan (which were sold in Fiscal 2000).

That's of course bolstered by sales of PS1 games, so it's not singling out PS2. But it's the best I could find, sorry. It also says they had shipped (not sold through) 10.61 million units worldwide. I'll have to make a mental note of that and see how many Xboxes were shipped worldwide by late Dec. of this year, when it has been on sale globally for 13 months.

PS3 release date: I naturally can't find any hard info. But the chip they're using in it is code-named "Cell" and is being developed by IBM and Toshiba. They had a techincal brief on its goals at GDC this year. Cell isn't slated for early production until 2004. Most of the reasonable guesses on the 'net say at least 2005 for a PS3 release, and quite possibly 2006 because of all the talk about how it's going to be this major high-speed network requiring distributed computing device thing. Reports from Japanese newspapers say the PS3 will use high-speed fiber optic networks. Those aren't exactly in place yet.

Nintendo is harder to judge. They made a profit of $800 million in the last fiscal year, ended in March. But that doesn't account for many Gamecube sales at all, and it's before the price cut's effect.

The best estimate I could find is this: Nintendo was losing only like $25 on each Gamecube sold when it was $199. They were easily making that up because with one first-party game sale they're break-even. (not counting marketing costs).

They expect to sell 10-12 million units worldwide by the end of this calendar year, and due to the price drop are now losing $74 per console. With about 5 million sold already, that leaves 6 million units to sell (splitting the difference at 11 million units) at a total loss of $450 million.

Nintendo's worldwide marketing budget this year is $500 million. That included GBA, though. If half of that is Gamecube, Nintendo's looking at $700 million in the hole before counting profits from games sold.

They're the best financial shape, though. They sell a lot of first-party games, which make them more money than 3rd party royalties, so they'll probably break even on Gamecube this year. Or close to it. They would have turned a profit had they not dropped the price and still managed to sell their target 10+ million units.

Obviously there's not a peep, whisper, or even rumor about the next Nintendo console. Nobody expects it before 2006, because obviously the Gamecube is so new. The only related rumor is that with Sega's great success at being software-only, admittedly Nintendo's strength, they won't do a next console at all, and just keep quiet until they switch to being a software maker alone in few years down the road. (I don't think that's likely, myself)

If anyone else has any actual figures, besides Red Herring's "we heard from a guy we know" numbers, post 'em here. I'm genuinely curious about how these finances and release schedules compare.

[Brad Grenz]

When Sony spent SEVERAL BILLION DOLLARS to make a fabrication plant to produce their own PS2 graphics chips, putting them several billion in the red before the first system was sold, nobody mentioned a thing. When they proved they couldn't run a fab well and the yeilds sucked so bad there was a huge PS2 shortage, nobody seemed concerned. Now that they've sold the fab (at a loss) and are paying the new owners to produce the PS2 graphics chips, it's not worth crowing about.

No one mentions it because the PS2 has been a brilliant success, whereas the Xbox is getting eaten alive. With the kind of steam Sony had built up coming out of the last generation any investment in the PS2 was basically a sure thing. But we're talking about MS losing billions of their investor's money dabbling in a vanity project that may prove a complete and utter failure.

Brad Grenz

[Jessica M.]

As long as MS has a virtual lock on the PC operating system market and continues to perform at at least mediocre levels, they can spend a few billion establishing the Xbox and it probably won't hurt their stock price that much. Pretty much every blue chip is operating near their 52-week low; it is part of today's market reality and MS is still strong at over $50 per, due to $42 billion in the bank and continual revenue from Windows and Office. Analysts are much more concerned by the fact that only about 1/3 of MS's corporate customers are biting on the new OS leasing plan, due to go into effect next month; that hits the company where it really hurts. If anything hurts the stock, that will be it and analysts are going to be monitoring the rest of the year carefully to see what MS does with this.

I agree with Dave Long about converage, for the most part. If it does happen, it is 'way down the road; the technology isn't near where it needs to be yet. But I don't consider the Xbox a vanity project, either, but a long term play to dominate the field where some limited convergence will happen in the next 5-10 years: The living room. Consider the possibility that the Xbox is just a 'stealth' method for getting Microsoft into the living room for a number of functions, no matter what they say about staying focused on gaming. MS has admitted they are experimenting with Xbox versions of all their products, they own significant pieces of a cable provider and a fiber provider and they built the Xbox hardware to be easily and cheaply upgraded (and the sofware can be patched on the fly out of the box, which is not something PS2 or GameCube can do right now).

They also realize that interactive entertainment is just one piece of the puzzle, albeit an important one. To truly dominate, you have to own pieces of everything from distribution to non-game content. I see this as MS's real plan, and I see them willing to go into the hole quite a bit to make it happen.

How far down the hole they are willing to go is the interesting question. How much can they spend before the shareholders scream?

[Anonymous]

I think Jessica is correct on this one. Microsoft has already announced they are trying to add ultimate tv to the xbox. Ultimate tv, combined with directtv, being a tivo like box. This type box, combined with xbox live give microsoft an ongoing monthly income. Which is their whole premesis for the future of the organization. They no longer want to sell software or licenses, just rent them out. Whether or not this will actually work is questionable, but it does appear to be the market they have embraced. The interesting thing here is how many people have digital cable or a directtv box? If instead of a cable box or directtv box they can convince people to get an xbox, either buying one or adding 10-15 a month to have one, on top of usage fees, it would be a profitable model. It works for cable now. Obviously this isn't something that will happen immediaetly, but when the market is there the xbox will be a branded name.

[Alan Au]

I'm wary because Sun/Oracle/Lotus tried something like this in 1997 with their highly touted "network appliance" thin client hardware. Times change, and MS is targeting the home market this time, but my impression is that people don't like to pay on a continuing per-use basis. It's a fine line, the difference between DVD rentals and pay-per-view DivX.

- Alan

[Mark Asher]

I certainly don't want to rent software. I hope that idea dies a quick death. That Microsoft is trying to move towards that is just further evidence of the power of a monopoly.

[Derek Smart [3000AD]]

Might I direct you to this, before it's too late?

Yes, I'm sure that in your perpetual delusional state (stupor?), you assume that I'm out to make friends with assholes who have nothing better to do with their time but troll the Net and post non-sensical kaka in forums.

Yeah, that must be it.

And you should be the one reading those books, lest we forget how I even got to hand you that response. Just keep pissing around with me, you hear.

Finally, if you think pointing to a site based on 1996 (history) is going to trip me, you really, truly are a fool. At best, a wanker. Show me what you've done between 1996-present day and lets play show me yours and I'll show you mine (www.3000ad.com/products/index.shtml)

Just quit while you're ahead. Consider yourself warned.

[Jason Cross]

No one mentions it because the PS2 has been a brilliant success, whereas the Xbox is getting eaten alive. With the kind of steam Sony had built up coming out of the last generation any investment in the PS2 was basically a sure thing. But we're talking about MS losing billions of their investor's money dabbling in a vanity project that may prove a complete and utter failure.

Brad Grenz

That's basically true about the momentum from the previous generation.

But we have yet to see how the comparative success will be. As I pointed out from Sony's own figures, after nearly 13 months on the market they had shipped 10.61 million consoles worldwide. It'll be mid-December before Xbox is 13 months old... I wonder how they will compare?

People compare the consoles on equal footing, when the PS2 had a substantial lead, AND will most likely have a substantially earlier "obsolescence date."

As for losing billions of their investor's money: MS still will post a net profit of $10-12 BILLION dollars in the fiscal year ending this month. Could it be a billion higher without Xbox? Yeah, sure. But MS is banking on their profits being a billion or more HIGHER after fiscal 2004, and for a decade to come, because of the beating they take now.

It's like MS Research. The research division at Microsoft is about 600 people, all very well paid and well funded. That division "loses" a billion dollars or more of their investor's money every year. (seriously!) A great deal of the work they do never sees the light of day. But what does become a product, or part of it, is very much responsible for a big 'ol hunk of that $10-12 billion net profit (in a weak year, nonetheless).

It's just the Microsoft Principle. Everything they do is a bigger deal than if anyone else had done it. Their competitors are often just as evil, controlling, manipulative, and often have just as many shortfalls and stillborn projects. That's in the gaming world and elsewhere. But they're not Microsoft.

I'll say this much: I don't care if Xbox is a gigantic financial sink for Microsoft. Hell, if they want to lose a ton of money to bring me great games, fine. I only care that they bring me great games by hook or by crook, and by god, they're doing it. (as are Sony and Nintendo)

[James Gutierrez]

I'll say this much: I don't care if Xbox is a gigantic financial sink for Microsoft. Hell, if they want to lose a ton of money to bring me great games, fine. I only care that they bring me great games by hook or by crook, and by god, they're doing it. (as are Sony and Nintendo)


I agree. I realize that people love to debate the business side of things, and as a software developer I have decidedly mixed feelings about Microsoft in general. As a gamer, however, I think the Xbox is just fucking cool, and I think MS deserves a lot of praise for what they're doing in the console arena. Trust me, the irony doesn't escape me, but I really think that right now they are the most innovative player in the industry. How long has the console industry wrestled with the whole peripheral/software chicken and egg problem? I'm glad MS had the balls to just include the hard disk and ethernet from the beginning, and at no more cost to me than the PS2. I may be overstating things, time will tell, but when I got the content cd for DOA3 I really felt like it was a watershed moment in console gaming. The fact that Rallisport only sold half a dozen copies in Japan doesn't make me enjoy it any less than the fact that David Hasselhof is big in Germany makes me feel like I'm missing out on his musical stylings. My whole opinion of the Xbox was pretty much summed up by seeing that mech game with the ludicrous controller at E3: I have no idea how they are going to make money off it, but I sure am glad someone's doing it.

[James Gutierrez]

I certainly don't want to rent software. I hope that idea dies a quick death. That Microsoft is trying to move towards that is just further evidence of the power of a monopoly.

What exactly do you find objectionable about renting software? Blockbuster seems to be doing a pretty brisk business renting games, so I don't think the idea is going to die any time soon. Why is it ok to rent your internet access through your ISP, but not software? For that matter, aren't you in essence renting software when you pay a monthly fee to play an MMORPG? I'm not trying to be argumentative, it's just that I hear that sentiment a lot and I'm curious.

[Mark Asher]

I certainly don't want to rent software. I hope that idea dies a quick death. That Microsoft is trying to move towards that is just further evidence of the power of a monopoly.

What exactly do you find objectionable about renting software? Blockbuster seems to be doing a pretty brisk business renting games, so I don't think the idea is going to die any time soon. Why is it ok to rent your internet access through your ISP, but not software? For that matter, aren't you in essence renting software when you pay a monthly fee to play an MMORPG? I'm not trying to be argumentative, it's just that I hear that sentiment a lot and I'm curious.

Well, what Microsoft would like to see happen is that Windows become something that can only be rented, not purchased. That's what I'm against. As long as Microsoft also offers their products for sale at a reasonable price, let them lease software too.

It's a weird situation. The better Microsoft makes their products, the less incentive there is for the market to purchase future iterations of same. Software doesn't wear out like a mechanical part. It just becomes obsolete, but if it works well, there's no reason for the market to discard it for something new.

Anyway, the last thing I want to see is a situation where I can only use Windows if I pay Microsoft a yearly fee.

[Jessica M.]

Anyway, the last thing I want to see is a situation where I can only use Windows if I pay Microsoft a yearly fee.

Which is exactly Microsoft's plan. As far as they are concerned, you don't own the OS software right now, you lease it from them under the conditions of their EULA. If they wanted to, they could revoke your license, although in practice, trying to revoke individual copies of Windows CDs just isn't enforceable right now.

On the other hand, using XP and it's successors tied to a particular computer and unbundling OS and various Office suite functions for leasing online, they can most surely shut down any individual license fairly easily, if they wished to. In practice, I doubt they would be rushing to do so; doesn't make good business sense and MS is all about the money.

On the other hand, they could also use this method to shut down whole enterprise and OEM licenses. Consider how MS threatened Compaq with a denial of a Windows license a few years ago when the computer maker wouldn't knuckle under to MS's demands re: Netscape OEM bundling, and this one becomes very scary, indeed.

But we shouldn't worry, as Microsoft doesn't have a monopoly. Really. Honest. No kidding, man, just ask them.

[JeffL]

Blockbuster does a good business renting games, but there's still an option to purchase a game you like a lot. I'd love to be able to rent PC games as an option - but only if I still can still purchase what I want to own.

But that probably won't ever become a problem, because the market forces will keep things balanced wrt games. What is a bit discomfiting are the hints that MS is making that they would like to go to a rent/lease only mode for OS and productivity software. More so for the OS - making their word processesing, spreadsheet, email client, etc. lease only would probably just open the door to competitors (a door that is pretty close to closed right now.) But if they made the OS rent only, with the practical monopoly they have, under the guise of "we just want to keep your system updated", that would feel pretty damned oppressive. At home, I've still got one of my three systems running 98SE and have no reason at all to spend the money to upgrade it. At my office (a Fortune 50 company) MS came in with an outrageous leasing proposal for upgrading our app. 40,000 + systems to XP Pro (we're running 98SE on most of the desktops) - it literally would have been cheaper to go to the local Office Max and purchase 40,000 upgrade copies. The same for our Office suites. We basically told them thanks, but no thanks for now. I imagine they would love to move to a system that gave companies like ours no option but to pay 40,000 yearly fees or else our systems go down.

[Ben Sones]

It's a weird situation. The better Microsoft makes their products, the less incentive there is for the market to purchase future iterations of same. Software doesn't wear out like a mechanical part. It just becomes obsolete, but if it works well, there's no reason for the market to discard it for something new.

Anyway, the last thing I want to see is a situation where I can only use Windows if I pay Microsoft a yearly fee.

The problem is the perception that Windows is "good enough," and that further work on the OS is unnecessary. It may seem like new commercial versions of Windows don't offer worthwhile new features, but that's because many of the most important improvements to the OS are things that MS gives away for free to licensed Windows users--new versions of DirectX, for instance. You say that you feel little incentive to buy new versions of Windows, and I agree that MS has more trouble finding ways to make it seem like a new product worth buying again. But the money that they take in via Windows sales is money that they use to develop new versions of DirectX every year or so, not to mention the myriad of other improvements that you download via Windows Update all the time.

Given that, it almost makes more sense to go to a subscription-based model. They may have trouble selling the concept to consumers, but ojectively speaking, it's not an unreasonable approach. Of course the big unknown is price--an expensive pricing scheme for such a program would be pretty oppressive, I agree.

[Mark Asher]

"Given that, it almost makes more sense to go to a subscription-based model. They may have trouble selling the concept to consumers, but ojectively speaking, it's not an unreasonable approach. Of course the big unknown is price--an expensive pricing scheme for such a program would be pretty oppressive, I agree."

Once they move to a subscription-only model, there's no real incentive for them to do more than cosmetic upgrades and bug fixes to the OS. I'd be far more comfortable with Microsoft having to convince me to buy new versions of the OS by adding new, compelling features rather than them using the leverage of their monopoly to make me lease their software.

I'd also be willing to purchase DirectX from time to time for a modest cost if it came to that. I'd probably skip versions, but I'd buy it periodically. That has value to me. New versions of MS Word don't.

[Ben Sones]

Once they move to a subscription-only model, there's no real incentive for them to do more than cosmetic upgrades and bug fixes to the OS.

But you were arguing that they do this anyway, without the subscription model. I was merely pointing out that the upgrades that they sell are less important than the upgrades that they give away for free, so perhaps they should rethink which upgrades they sell. I don't really care how they bill me for them, as long as the price works out to be roughly the same either way. It's kind of like running an all you can eat buffet. You charge a price at the door, and once you're in you can eat all you like. But in Microsoft's case, you can keep coming back to the buffet for years without paying the entry fee again, if you like. Seems like a dumb business strategy.

[Rob de los Reyes]

Shouldn't somebody have mentioned micropayments by now? I'm not sure in exactly what form, but when I come to Qto3 I expect to see the word "micropayment" somewhere.

[Mark Asher]

"But in Microsoft's case, you can keep coming back to the buffet for years without paying the entry fee again, if you like. Seems like a dumb business strategy."

It's how they crushed Netscape. Had MS charged $49.95 for the browser there's no way they would have dominated the market so quickly.

They started giving away DirectX for free in part to sell W95 as a gaming platform. Once you start giving it away, how do you then justify selling it?

DirectX is used for other things besides games, isn't it? Microsoft is still competing with things like Realplayer and other third-party media thingys. They want streaming video, audio, and stuff like that to all go through them, presumably so they can someday tack on their surcharge and get a piece of every transaction. So they give stuff away for free and put that much more pressure on the competition.

It's the power of a monopoly at work. Quicken is the only app I know of that managed to not get crushed when Microsoft decided to go after a particular market, and Microsoft then attemped to buy them. Heh.

Edit: Ok, there are others, like Oracle. In the mass market I don't know of anything else besides Quicken.

[TimElhajj]

They haven't been able to do a decent Tax program either.

[Desslock]

>As far as they are concerned, you don't own the OS software right now, you lease it from them under the conditions of their EULA

Well, technically that's the case now, of all software. It's never "sold", just the right to use is licensed under the terms of a licence agreement. Microsoft's proposal is pretty annoying, as were the ASP models circulating a while back. It's particularly annoying because there's no way around having to deal with Microsoft -- when other companies pull this stuff (like Norton Antivirus), I just stop buying their products.

The first thing I do when I get a new Dell computer is uninstall and delete Norton, and install the 1998 version that has free virus definition updates.

[Ben Sones]

It's how they crushed Netscape. Had MS charged $49.95 for the browser there's no way they would have dominated the market so quickly.

But "the market" that they came to dominate is one that no longer generates income for anyone. They don't sell Internet Explorer. Examined as an isolated case, this would have seemed a dumb business move, because they ultimately eliminated that market (for themselves as well as Netscape).

Of course the real reason they gave away IE for free was to bolster their core OS business, by integrating Internet functionality into the operating system. But the same analogy doesn't hold true to Windows, because that IS their core business. What would they possibly hope to gain by keeping the "buffet" open there?

[JeffL]

Mark's point is spot on: once you remove the "choice" aspect from upgrading (i.e., paying for the newest version) you eliminate most of the drive for investing resources in developing significant real improvements in the product. Think about it: a world in which everyone is running Windows XX and in which everyone who doesn't want the OS to stop running has no choice but to give Microsoft whatever payment they require each year (or month.) Does that really sound like a good deal for the consumer?

[Mark Asher]

"Of course the real reason they gave away IE for free was to bolster their core OS business, by integrating Internet functionality into the operating system."

You sound like a Microsoft witness giving testimony in the anti-trust case. Undoubtedly there are some advantages in integrating the browser and OS more tightly, but the real reason Microsoft gave IE away for free was to forestall any potential shift from the OS to the browser as the focal point of activity on the PC. There was a lot of talk about the browser and distributed computing becoming more important than the OS. The idea was that it wouldn't matter which OS you were running, you'd be doing everything important through the browser. Microsoft saw this as a threat to their core business and crushed Netscape by giving IE away for free.

[Mark Asher]

"Think about it: a world in which everyone is running Windows XX and in which everyone who doesn't want the OS to stop running has no choice but to give Microsoft whatever payment they require each year (or month.) Does that really sound like a good deal for the consumer?"

Just to see this principle in action, all you have to do is look at Microsoft and how they have handled IE before they killed Netscape, and then after.

Before, when there was still competition for the browser market, Microsoft and Netscape both worked like mad and continually upgraded their browser software. We probably got three or four new versions of each browser a year for a year or two as they battled.

Now that Netscape's been reduced to linux-like marketshare, the pace of updates for IE has slowed tremendously.

[Dave Long]

...and if you really believe the browser was going to replace the OS to the point you'd be doing "everything" with it, you obviously have never worked in the IT business and you probably lost a hell of a lot of money on the stock market internet implosion too.

--Dave

[Mark Asher]

"...and if you really believe the browser was going to replace the OS to the point you'd be doing "everything" with it, you obviously have never worked in the IT business and you probably lost a hell of a lot of money on the stock market internet implosion too."

Thank you for siezing upon a single word to derail my argument, which wasn't really an argument as much as a recounting of an idea that was bandied about at one time and which Microsoft did indeed see as a threat.

Yes, the browser wouldn't do EVERYTHING. There was discussion about the browser being the entry point and interface for most of the typical tasks people used PCs for -- email, browsing, word-processing, etc.

And if you think that didn't worry Microsoft, then I'll just ask you look at how fiercely Microsoft fights to control which icons appear on their own desktop. You'd think they'd sit back and be happy with PCs that boot up and immediately display Netscape? Sure they would. :wink:

[Ben Sones]

You sound like a Microsoft witness giving testimony in the anti-trust case. Undoubtedly there are some advantages in integrating the browser and OS more tightly, but the real reason Microsoft gave IE away for free was to forestall any potential shift from the OS to the browser as the focal point of activity on the PC.

I never said that isn't true. They bolstered their OS business by running a potential future competitor into the ground. They gave up the opportunity for future revenue in the browser market to do it, because they essentially killed the browser market in the process.

My point was not to pass judgement on the ethical pros and cons of that action, but rather to point out that they aren't going to sacrifice their OS business in the same way, because without their OS business they have no business.

[JeffL]

...and if you really believe the browser was going to replace the OS to the point you'd be doing "everything" with it, you obviously have never worked in the IT business and you probably lost a hell of a lot of money on the stock market internet implosion too.

--Dave

Perhaps that's a bit of a stretch, Dave - but the fact is that, for some reason, Microsoft was motivated to crush Netscape and to try to ensure that every user ran IE. Giving IE away for free wasn't due to MS's sudden desire for social magnamity. And then they wanted to integrate IE into the OS as tightly as possible.

I don't think Microsoft is "evil" by any means - people who know me know that I'm a huge supporter of capitalism. However, they are getting very close (if not already there) to having an overpowering monopolistic power. The fact that our company, global, Fortune 50, about 45,000 employees, has so few options for our global set-up for desktops and so little leverage in dealing with MS on OS options, is one sign of that. The other is that the average consumer has so little options when it comes to having to go whatever direction that MS dictates (Apple aside.)

That said, I do think that MS got to where they are by mostly fair business practices: they achieved their OS dominance by defeating Apple and IBM head up. They also prevailed at a time when businesses decided that they needed to establish a common OS standard across their company. But I'm not at all comfortable at how MS is going to use the power they currently have achieved in the OS field.

[Mark Asher]

"My point was not to pass judgement on the ethical pros and cons of that action, but rather to point out that they aren't going to sacrifice their OS business in the same way, because without their OS business they have no business."

You mean give the OS away like they gave the browser away? I'm not sure what you're getting at.

I just don't see any real advantage for consumers to move from a "pay when consumers want" structure like we currently have regarding the OS to a "pay when Microsoft wants" structure, like leasing would entail.

The only advantage is regular updates, but we could still get that via purchases. There's no reason Microsoft can't sell an XP "expansion" (for lack of a better term) for $20.

[Ben Sones]

You mean give the OS away like they gave the browser away? I'm not sure what you're getting at.

Right. If the upgrades that they are building into the retail product are less and less compelling, and all the good upgrades are the free ones that you get once you own the product, then there is less and less incentive for consumers to buy the product. Eventually you end up spending billions of dollars supporting a product that no longer generates revenue.

The solution is to either integrate the "good upgrades" into the retail product, so that people no longer get them for free, or abandon the idea of the retail product altogether and have people subscribe to your update service.


I just don't see any real advantage for consumers to move from a "pay when consumers want" structure like we currently have regarding the OS to a "pay when Microsoft wants" structure, like leasing would entail.

I never said there was one. I just said that from a business sense, it's not an illogical move for MS to make. If they find that most of the money they spend ends up being on the stuff they give away for free, and the money that they make stops coming in because people like yourself are perfectly happy living with Windows98 and whatever free upgrades MS offers for it, then it makes sense to stop pouring money into new versions of the software that people (apparently) don't need and start charging money for the upgrades that they do need.


The only advantage is regular updates, but we could still get that via purchases. There's no reason Microsoft can't sell an XP "expansion" (for lack of a better term) for $20.

True enough. That would probably be in lieu of regular, instant updates, however, which are somewhat handy.

[Mark Asher]

" just said that from a business sense, it's not an illogical move for MS to make. If they find that most of the money they spend ends up being on the stuff they give away for free, and the money that they make stops coming in because people like yourself are perfectly happy living with Windows98 and whatever free upgrades MS offers for it, then it makes sense to stop pouring money into new versions of the software that people (apparently) don't need and start charging money for the upgrades that they do need."

Sure, what company wouldn't want to ensure a constant, predictable revenue stream through lease arrangements? It's a great deal for the business. It would be a great deal for Microsoft.

Unless I'm a stockholder, I don't care what's good for Microsoft. I want value for my money and I want to control when and where I spend my money.

The troubling aspect is that we don't have a viable option. Like Desslock said, we have to deal with Microsoft.

[Jason Cross]

But "the market" that they came to dominate is one that no longer generates income for anyone. They don't sell Internet Explorer.

Well, they sell it to Apple, but other than that...

It's not like it ever generated any revenue for anyone, except for Netscape invisible monopoly money (stock). I mean, sure you could go to the store and buy Netscape, but you could get it free even easier.

Did anyone actually buy Netscape Navigator?

[Mark Asher]

I'm sure a few did. It was in the stores and some people are sticklers for being legal with their software.

[Dave Long]

You could be perfectly legal by downloading it for FREE, Mark.

--Dave

[Brad Grenz]

Killing Netscape also gave MS all but defacto control of http standards. Netscape would have supported open, cross-platform stuff, but MS figures owning the browser can be leveraged towards the server market. You know this .Net stuff? Basically the idea is that every computer in the chain has to be running Windows with an MS server package.

[Mark Asher]

You could be perfectly legal by downloading it for FREE, Mark.

--Dave

As I recall, it was free if you were a student or a teacher. I don't think it was free for others, though anyone could download Netscape. They relied on the honor system.

Maybe at some later point it became completely free?

Ok, I found a site with a bullet point history of Netscape:

"With the launch of Windows 1995 and a web browser of its own (Internet Explorer) in August 1995, MS began to challenge Netscape. Unlike Netscape, Internet Explorer was free of charge, but not yet bundled with Windows (it came withe the old Plus! package). "

Then:

"January 1998: Netscape announces that all future Netscape browsers will be free of charge and also that the development of the browser will be open-source."

Here's the link:

http://www.hmetzger.de/netscape/Netscape_History.html

Edit: I know I'm being anal, but I was curious. The above link had old versions of Netscape. Here's part of the license agreement for v1.1:

"GRANT. Netscape Communications Corporation ("Netscape")
hereby grants you a non-exclusive license to use its
accompanying software product ("Software") free of charge if
(a) you are a student, faculty member or staff member of an
educational institution (K-12, junior college or college) or
an employee of a charitable non-profit organization; or (b)
your use of the Software is for the purpose of evaluating
whether to purchase an ongoing license to the Software. The
evaluation period for use by or on behalf of a commercial
entity is limited to 90 days...."

So you were supposed to purchase it after 90 days, though I doubt many did.

[James Gutierrez]

Killing Netscape also gave MS all but defacto control of http standards. Netscape would have supported open, cross-platform stuff, but MS figures owning the browser can be leveraged towards the server market. You know this .Net stuff? Basically the idea is that every computer in the chain has to be running Windows with an MS server package.

Mind expanding on this a bit? Particularly the last line. I've worked with .Net since the beta1 and that seems like the grossest mischaracterization I've seen outside of Slashdot.

No doubt MS would love for all enterprise apps to run purely on .Net servers and their development tools are obviously targeted at windows implementations, but there is nothing in the technology which ties development to windows. In fact .Net contains a lot of features which make it much easier to develop apps that fit into a heterogenous environment:

1. They've made a huge push to replace DCOM with standard SOAP web services for intermachine communications. This allows any app (on any OS) that can send an http request and parse XML to communicate at the function call level with a .Net app. They've made it incredibly easy to write and consume these web services. I just finished writing a clinical scheduling app that was targeted at a Win2K server running .Net. Just as an exercise, I decided to expose the whole api as a set of web services: it only took me half a day.

1b. Practically any object in the class library, from System.String to complex datasets including multiple related tables can be serialized to standard XML with 4 lines of code.

2. ECMA standardization of C# and the CLI. You can download the shared source implementation (http://msdn.microsoft.com/library/default.asp?url=/library/en-us/dndotnet/html/mssharsourcecli2.asp) and compile it on FreeBSD right out of the box.

3. Check out the Mono project (http://www.go-mono.com/index.html). They're creating an open source implemetation of .Net and have a significant chunk of it running on Linux.

4. ASP.Net: They've finally separated behavior from display for web based apps, especially with the web control classes. All you have to do is write to the web contol interface and the class takes care of rendering client side functionality on different browsers. Don't like that way a control works on a certain browser? Just subclass it and override the Render() method. Incidentally, the web control object model also fixes a lot of the inconsistencies with scripting against the existing HTML forms model. For example, why is a multiline text input a completely different object in HTML (textarea vs. input)? With web controls, you just create a textbox, set the mode to multiline and let .Net render the proper HTML.

Oh, and Netscape's commitment to standards was always a joke. Their implementations of the DOM and CSS support were abysmal. (And do I even have to bring up <blink>?) Gecko is great, but I'm afraid it's too little, too late. Back when it really counted, they dropped the ball. Microsoft's monopolistic machinations aside, ever since 4.0 IE was the clearly superior product, at least from a developer standpoint.

[Derek Smart [3000AD]]

Once they move to a subscription-only model, there's no real incentive for them to do more than cosmetic upgrades and bug fixes to the OS.

Therein lies the rub. I have no problem with renting software, apart from the fact that is just promotes piracy. :roll:

The way I see it, all these companies moving toward pay-for-play titles is exactly the path that normal software is going to go (mark my words).

As far as game-enhancing patches go, gamers are not entitled to anything other than what comes in the box they paid for. HOWEVER, because most games these days - even those by large enough companies - come out not quite baked. Game-enhancing patches (apart from bug fixes) are (at least for me) a sort of way to thank the gamers for putting up with that crap. And they don't have to. And as I've said over the years, gamers should vote with their dollars and they seem to being just that.

You can test a game for as long as you bloody well want, but as soon as it hits the streets, there is a good chance that you're going to get hit with a plethora of bugs. I know this first hand. Even BCM was in Beta testing for almost a year and it still shipped with bugs (thank God it didn't have any showstoppers) and the upcoming BCG has been in Beta for about two months now.

So, I don't see how renting software is going to stiffle the release of bug fixes and game-enhancing patches. To the wise gamer, renting a game should be no different from buying it - because it is still money. Renting a game that has bug fixes, game ehnancements, mods etc, is probably the incentive to buy it if you like it.

Anyway, I'm all against renting software and unless someone shows me some serious money (I even turned EB, my distributors, down when they wanted to do it a while back), I'm never going to do it. Besides, I have a dedicated fanbase and since I have no wild interest in growing it, I don't have to worry about whether my game will make more money if rented.

For one thing, since I am notorious for game-enhancing patches, once my next sp+mp games ship (BCG+BCTC), my pay-for-play intiative, BCO, (which is also in development since it uses the recent BC engines) is going to be the only product I'm doing, going forward. I'd rather have a select group of people paying $7 - $10/month to play online (unlike other similar games, it will also have a functional offline mode but which requires connection to the server for a/c authentication) and have new stuff on a regular basis, than to deal with the logistics, nightmare, uncertainty and aggravation of doing a new title every two years. And this is the direction I see the gaming industy going in.

[wumpus]

You know this .Net stuff? Basically the idea is that every computer in the chain has to be running Windows with an MS server package
No, no, a thousand times, no. In fact, it's almost completely the opposite. .NET is more like Java than anything else. While Microsoft isn't going out of their way to port the .NET runtime to platform other than Windows, they've given other groups carte blanche to do so.


Gecko is great, but I'm afraid it's too little, too late.
Not if AOL makes Mozilla the standard browser. I think they will, and it's probably a good thing. IE has too much of the browser market now.

[Lee Johnson]

Did anyone actually buy Netscape Navigator?
I did. Ironically, that was not long before I finally became fed up with Navigator's instability and switched over to IE, where I have traded instability for the Security Hole of the Week. :-P

[bgumm]

Mind expanding on this a bit? Particularly the last line.

Agreed. The last line was generalized to the point of mass-distortion. Made no sense!