Why did MS kill the Xbox?

Joebob · 28 Jan 2007 at 19:35

Just wondering why MS completely stopped production and support etc for the Xbox when the 360 came out?

Surely if they copied Sony's model and carried on production of a smaller, more production cost effective system, and then sold it at about £100 they could sell to a younger generation of gamers ensuring future sales of 360 when said gamers want next version of their console!

Seems like a no brainer to me so I was wondering if there's actaully a valid reason or is it just short sightedness on MS's part?

Joebob · 28 Jan 2007 at 23:38

Memphis said:
Sega didn't kill the Dreamcast. Sony did.

I actually think that Sega never recovered from the Saturn tbh, and then lack of cash for advertising etc killed it.

Joebob · 28 Jan 2007 at 23:42

Tried&Tested said:
Why would they want to divert sales from the xbox 360?

Sony wouldnt have released the Slim PS2 if they had their PS3 on the shelves.

They wouldn't be diverting sales as it would capture a amrket which couldnt afford the 360 and enforce the product brand in the process. There are a lot of the young generation who are just getting into gaming who will buy a PStwo as an introduction to console gaming and will no doubt upgrade to a PS3 in a few years. Microsoft could have done the same and it would have made good business sense even if they didn't make much profit on each Xbox sold.

IMO

P.S. The PS3 has been on the shelves (gathering dust some might say) for several months now and the PS2 is still selling as Sony are still releasing it!!!

Joebob · 28 Jan 2007 at 23:56

Memphis said:
Remember though that the PS3 is still very much in short supply, so that might have something to do with it.

Out of curiosity, have Sony made any sort of projections as to how long they will keep producing the PS2 after world wide release of the PS3?

If this is anything to go by then the PSone had an 11 year production span and a Six year overlap with the Playstation 2. Which would mean they will pull the plug on the PStwo in 2011.

"Having lasted over 11 years, the PlayStation has enjoyed one of the longest production runs in the videogame industry. On March 23, 2006, Sony announced the end of production." - Wikipedia

Joebob · 28 Jan 2007 at 23:57

Joebob said:
If this is anything to go by then the PSone had an 11 year production span and a Six year overlap with the Playstation 2. Which would mean they will pull the plug on the PStwo in 2011.

"Having lasted over 11 years, the PlayStation has enjoyed one of the longest production runs in the videogame industry. On March 23, 2006, Sony announced the end of production." - Wikipedia

Now does anyone think that by only having a 4-5 year shelf-life MS are selling their customers short?

Ooops, sorry - double post!!!

Joebob · 29 Jan 2007 at 07:47

fish99 said:
Well they were selling the hardware at a loss, and with interest in the xbox waining with the 360 available, there probably wouldn't be enough games sold to make it worthwhile for them to continue with the xbox. Plus with it needing the harddrive they couldn't shrink it much.

Really? I didn't realise they were still losing money on each console - I thought it was only at launch they lost money and they started making a profit on each unit when production costs fell.

Is that the same for all consoles or was it just the Xbox?

Joebob · 29 Jan 2007 at 16:50

Tunney said:
I would imagine that it's due to the way in which the Xbox was developed.

Just like the Zune, Microsoft rushed the Xbox to market. It used off the shelf components and thus they managed to develop it in a very short period of time.

The problem lies in the fact that Microsoft doesn't own the hardware. The original Xbox was essentially a PC and all the component manufacturers charge Microsoft hefty licensing fees.

That's not normally how consoles are produced. Sony own the rights to the vast majority of the components inside the PS2. There's no third parties demanding licensing fees and they can do with the technology as they please (i.e. develop it further or miniturise it). Any manufacturing cost savings can be passed on to the consumer.

Microsoft have gone down the same route as Sony/Nintendo for the Xbox 360, so I wouldn't be surprised if we see a Xbox 180 towards the end of the 360's shelf life.

Ah, now that makes sense... about time too I might add :|