Bach promises Xbox profit in 2008
Microsoft's days of pumping endless cash into the Xbox platform in a bid to establish themselves at the heart of home entertainment could be at an end soon, with Microsoft entertainment and devices boss Robbie Bach promising the Xbox platform will break into profit come 2008. This will come as welcome news to Microsoft investors, who have seen shares and dividends hit by huge investments in Microsoft's gaming escapades.
"It's a business that will be profitable next year. We'll make money next year and that will be the first time, which is pretty exciting," Bach told eWeek, in the wake of financial reports indicating that revenues at the entertainment division have fallen, but so have losses. Bach explained that profitability should arrive next year as Microsoft begin breaking even on 360 sales and Live revenue and game sales progress.
"Xbox is the hardest piece of consumer electronics hardware to produce in the world, no debate," the president affirmed, conceding that costs are rather higher than MS would like at present. "We're humming pretty well in the business. Game attach rate [is at the] highest level in history for a game console at this stage in the life cycle. The same with our peripheral attach rate. Xbox Live has over 6 million members. The pieces are in place to drive the proverbial billion dollars," Bach confidently predicted.
He also took at swipe at Sony stating that MS and Nintendo are 'in charge' of this generation, while Sony struggle with costs, pricing, content and their online proposition. He also admitted to being surprised by the success of the Wii console. More soon.