Xbox 360 Warranty: All is Not So Rosy in Microsoft - Land
Hot on the heels of E3 where Microsoft was gushing loudly about how the Xbox 360 is statistically the number-one game console on the planet – Microsoft gets the almost $2 billion bill.
Microsoft has posted a $1.89 billion USD operating loss for the Xbox 360 this year. The losses are mostly due to the $1.06 billion cost incurred for the big two-year contract extension from one year to a full three years due to the overheating issues.
The huge loss has forced Microsoft to cancel the X07 conference planned for
Despite the rosy spin Peter Moore put on operations down at Microsoft entertainment and devices, things area a little tougher than they let on at E3. The console games business is a tough one that tends to operate out of an accepted loss up-front just to get your hardware into the hands of users. Once that's accomplished the money is presumed to be made when the hardware becomes indispensable because there are so many games available on your platform.
It's definitely not a business for the timid, only the tough minded with a strong stomach need try to compete with deep pockets like Sony and Microsoft.