Barkley's Justice
Member
Billy Gates don't give a fuck!
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Bill Gates: "If MSFT CEO Nadella wants 2 spin off @XBox biz I'm absolutely for it."
- Thread starter Darksol
- Start date
Memorabilia
Member
For starters, there is a strong perception that Microsoft's larger bureaucracy is the primary reason the Xbone's design turned out the way it did. Some higher ups had a vision of pushing Kinect and turning Xbox into an all-in-one device to essentially trojan horse multiple subscription based revenue streams from American living rooms. Meanwhile, the target market just wants games. The end result is gamers end up with an under-powered console at an inflated price, relative to the competition...a problem which is going to plague the Xbone this entire generation unless there is a change of focus. Spinning off the Xbox division would potentially allow gamers to run things from here on out (rather than bean counters and bureaucrats).
Spinning off the division has risks (primarily that the division sinks or swims on its own merits...the balance sheet is fully open to scrutiny) but I believe it would inherently be a good thing for the health of Xbox and for gamers as well. After all, the primary reason the 360 was successful was because during most of its early run the Xbox division had much more autonomy than they appear to have now, from the design phase all the way through marketing and selling it. They essentially provided a near perfect product for what the market wanted at the time, which is why it was a great success in the US. Things began to change around 2010 with the focus shifting to Kinect. And then the company began doing internal restructuring, which culminated in the most recent official public restructuring in which Xbox was essentially brought under the Windows group. The end result is that the creative people in the Xbox division have far less autonomy to make gamer-centric, timely, market directed decisions than their forebears did when selling the 360. The only "benefit" gamers saw from this move was the ham-fisted attempt to jam the Win8 tile UI into the 360 and then Xbone, when many would argue the old "Blade" system was far better. Just one more example of how the larger vision at work is not compatible with what the market wants.
The sad thing is the Xbone has the obvious feel of a money machine designed by committee rather than a gaming console designed by gamers. So, it could be argued that no matter what MS does at this point it will carry this stigma the entire gen. But, I'd be all for shaking things up and seeing if the passionate gamers at MS can turn this thing around despite it having a hardware handicap and a major image problem. Separating the Xbox division from MS would at least partially solve the latter problem, as most of the Xbone's PR problem stems from its connection to the larger company.
Penguins&PolarBears
Member
Xbox One outsells Apple TV, (Xbox 360 + Xbox One definitely outsells AppleTV) especially when you consider holiday season.
Apple TV only sells about 1-2 million units per quarter.
Given the power of the Apple brand that's not impressive at all.
Each quarter:
Mac = 4-5M
iPad = 16-25M
iPhone = 40-50M
These devices make the majority of their profit from high margin hardware. AppleTV is relatively low margin hardware comparable to iPod.
I think Apple TV will eventually become a serious threat to Xbox and Playstation, but right now it is still far behind. It brings in less revenue, it sells fewer units, and the apps and services it has to offer are far more limited.
Which is even to double what Xbone did last quarter, correct?
2013 was 10m units, which is around tied with the X360 yearly average, as well. 10m Xbones in 2014 is pretty unthinkable at this point without a major price drop.
BlastProcessing
Member
At this point, wouldn't the iPad be a console competitor?
Garrett 2U
Member
Sure.
But they are talking about living room set top boxes.
Exactly.
FonkyByNature
Member
Thank you ! i thought i was the only one thinking Samsung sucks big time !
I hate their products because they're cheap and ugly. Their TVs are not bad but i would take a Sony/Sharp/Panasonic any day of the week over a Samsung.
And "Penguins&PolarBears" is the one who makes the most sense in this thread. Microsoft are not gonna get rid of Xbox. Xbox and games are essential to MS if they want to compete with the big boys like Google and Apple who would eat Microsoft's lunch if MS abandon the Xbox...
Without Xbox, MS wont sell Xbox Video, Xbox Music, Bing etc. that easily. Xbox is really the best consumer product they've ever done and they will continue with it in the long term. I'm not worried one bit about that.
rakkadakka
Member
Exactly.
It isn't what he's saying is important but rather than he's saying something like that at all.
NoPiece
Member
If the question had been, "do you support spinning off Windows, or Office?", do you think he would have said, "I support the CEO", or that he probably would have said, "Nadella isn't that big an idiot.".
So the answer doesn't suggest Xbox will be spun off as much as where it stands in the MS priority list (lowish).
Rogue_Ledr
Banned
Dude, all Microsoft knows about the gaming industry IMO, is throwing money around.
Any big company can do that.
SlipperySlope
Banned
It's pretty clear why Bing is better liked. It has several things going for it that the XBox doesn't:
1) Huge margin/money making potential if they reach a good penetration
2) Bing is growing very quickly, in both users and revenues
3) Bing is growing in market share
4) Bing is more easily integratable in other areas of Microsoft. IE can use Bing as its default search engine. Windows Phone can use Bing. Surface can use Bing. Even XBox can use it if they choose to keep it. And I'm sure there are many other areas that can use it that I'm not thinking of.
XBox has none of these.
graywolf323
Member
did you watch the video? the question actually came from students at Nadella's alma mater
BlastProcessing
Member
Yeah, I get that. It's just there has been this focus for the last 20 years on the living room. "The war for the living room" is the whole reason Sony and Microsoft got into the console business in the first place. But things have changed. So maybe everybody was digging in the wrong place this whole time and phones and tablets are a much better way of getting into people's living rooms.
Dont forget information gathering
Memorabilia
Member
Not necessarily. The Xbox division succeeded with 360 when it had a brief window of autonomy. From what I understand, Xbox is Bill's baby...and he probably understands its their one direct link to consumers that even still has a generally positive image. The over-arching MS image of being anti-consumer has obviously dragged down an otherwise positively viewed product line. This could basically just be Bill's way of letting people at MS know they need to restructure in some way to give Xbox a chance to succeed on its own merits. Whether that comes from spinning it off or restoring the autonomy the Xbox division had when Allard's group was there doesnt matter. Either option would be a good thing for Xbox.
BlastProcessing
Member
All of these are true and a big number 5 is that Bing has all of Microsoft's machine learning technology. That type of stuff is Google's secret sauce and Microsoft needs it to compete. Also if I recall correctly, the Bing department makes most of Microsoft's mobile and metro apps.
Yup.
Kinect covers that front.
Memorabilia
Member
I agree with this to an extent. The whole concept of an "all-in-one" device has never really worked for a variety of reasons, but it keeps resurfacing.
Bing is also the entirety of the brains behind Cortana, which for now is just on Windows Phone, but probably won't just stay on Windows Phone.
TheFLYINGManga_Ka
Member
XBOX U!
Perfect opportunity for Nintendo!
Nintendo will do amazing wonders with Kinect!
Perfect opportunity for Nintendo!
Nintendo will do amazing wonders with Kinect!
Memorabilia
Member
Which is why we can probably infer if the words "spin off" are being openly used then the division is in the black.
If you read the line of questions that is exactly what he was saying.
There's more too it too
http://blogs.seattletimes.com/micro...s-he-would-support-xbox-but-not-bing-spinoff/
There's been some rumor / speculation on the XBox brand moving more into the PC space, and the consoles serving as much shorter, iterative hardware (similar to Valve Boxes). The OS/Hypervisor/VM setup they went with is along those plans if they go that route.
http://blogs.seattletimes.com/micro...s-he-would-support-xbox-but-not-bing-spinoff/
There's been some rumor / speculation on the XBox brand moving more into the PC space, and the consoles serving as much shorter, iterative hardware (similar to Valve Boxes). The OS/Hypervisor/VM setup they went with is along those plans if they go that route.
Memorabilia
Member
Mattrick was almost certainly fired, as he should have been. The cluster fuck design, launch, and vision he oversaw did indeed do a ton of damage to the Xbox brand that had been carefully built up and fostered over the previous generation.
Bingo.
Memorabilia
Member
I dont necessarily think they'll spin it off. But, I do think they should. A more focused, autonomous Xbox division would be good for business and gamers alike. I cant believe this possibility hasnt crossed Bill's (or Nadella's) mind.
Duane Cunningham
Member
I'd like to see a Japanese-Italian plumber buy it.
I actually think the idea of an "all-in-one" device is flawed in that no device can do everything a consumer may actually want to do with one. For a perfect example, why do both tablets and smartphones exist? Both were made on the idea of an all-in-one device and use the same operating systems, but yet they serve two obviously different purposes for consumers.
Graphics Horse
Member
Interesting.
GoofsterStud
Member
Calm down:
This is just a fancy way of saying. "Microsoft won't be opening up it's warchest for the future of the Xbox."
Nothing more.
Thanks for sharing!
How damaging is this now that it's hit Gamespot, Polygon, etc?
This is just a fancy way of saying. "Microsoft won't be opening up it's warchest for the future of the Xbox."
Nothing more.
Thanks for sharing!
How damaging is this now that it's hit Gamespot, Polygon, etc?
GoofsterStud
Member
Please delete: Meant to edit my previous post.
ComputerMKII
Banned
Didn't Phil Spencer outright say they were going to try to do some things about PC this year?
Spine_Ripper
Member
This. I've literally played a total of 10 minutes on Xbox. This would get me to finally buy one. Imagine all those Prime deals...
Apophis2036
Banned
If they ever put the XBOX IP's up for sale I would like to see Nintendo buy the rights and development studios for Halo, Gears of War and Forza. Those three genres would help Nintendo immeasurably in the Western market but I have no idea how much they would cost ?.
Although I'm a big fan of Sony I wouldn't like to see them get those rights because it would lead to a monopoly and potentially them returning to being extremely arrogant and not listening to their customers / fans.
Although I'm a big fan of Sony I wouldn't like to see them get those rights because it would lead to a monopoly and potentially them returning to being extremely arrogant and not listening to their customers / fans.
KoopaTheCasual
Junior Member
Pls take several seats, Bill.
Yoda
Member
Its not completely out of left field given Elop, is in charge and looking at how he managed the Nokia transaction for Microsoft he would be the best person for his current position if they wanted to sell/spinoff. Right now given where the division is I doubt it would happen anytime soon. However given that a lot of industry analysts think this is the last "pure" generation of consoles and subsequent "consoles" resembling platforms, it would be an opportune time to exit the market as it hasn't been anywhere as fruitful as they anticipated. The silver lining here is they technically are the platform for PC gaming and do not leverage this fact AT ALL. Valve is very slowly (but with no resistance from the company which will suffer) trying to push games onto Linux. The fact that no one as Microsoft realizes the potential of their platform (windows) for gaming is unreal.
Sounds interesting. I've been wondering what things would be like if Xbox went PC and kinda competed with Sony from there.
Q
qizah
Unconfirmed Member
If Microsoft does decide to sell off the Xbox business, who would be the likely candidate?
The only company I can think of is Samsung. That's not a console I'd ever want to own.
The only company I can think of is Samsung. That's not a console I'd ever want to own.
shinra-bansho
Member
Without jumping to hysterics do people actually think that anything Bill Gates says publicly regarding Microsoft isn't going to be analyzed closely, and that Bill Gates isn't aware of this? It's Bill Gates.
Spin-offs can occur to unlock value for shareholders. Splitting off a division into a separate market entity can result in improved market and operational performance of the parent company and/or the new company.
General Electric isn't spinning off its retail finance unit because they're in dire straits.
Not necessarily.
Spin-offs can occur to unlock value for shareholders. Splitting off a division into a separate market entity can result in improved market and operational performance of the parent company and/or the new company.
General Electric isn't spinning off its retail finance unit because they're in dire straits.
When Bill Gates says something publicly about supporting Microsoft spinning off one of its divisions it's "not noteworthy"?
High level executives never openly speculate on such things, especially when it comes to large/public corporations, unless something's going on.
Freeman
Banned
Best strategy for MS would be to transition back to PC Gaming and have the Xbox as more of a Windows equivalent of SteamBox.
The end result is:
- they keep their studios and IPs.
- they finally achieve their digital-only always-on dream (worked for Blizzard and most of MS games are focused on multiplayer anyway).
-they increase the appeal of Windows for PC gamers.
-secure DirectX as the dominant API.
-They position themselves to compete with Steam and Origin (they are so close to EA that a partnership would likely be possible).
-They gain additional content to push new versions of windows the way they like to do it.
-strengthen their foothold on PC Gaming and piss on Valves parade, while also getting a free ride on the StemMachines by convincing the manufactures to offer version that come with Windows.
-they also get closer to their initial unifying their platforms and having Windows taking over the living room.
-It open many other doors to them, like cheap versions to compete against streaming boxes or for in-house streaming of games.
-Can now have their services available on different hardware, like Skype on PS4.
-they get out of shrinking market that made them lose money.
The end result is:
- they keep their studios and IPs.
- they finally achieve their digital-only always-on dream (worked for Blizzard and most of MS games are focused on multiplayer anyway).
-they increase the appeal of Windows for PC gamers.
-secure DirectX as the dominant API.
-They position themselves to compete with Steam and Origin (they are so close to EA that a partnership would likely be possible).
-They gain additional content to push new versions of windows the way they like to do it.
-strengthen their foothold on PC Gaming and piss on Valves parade, while also getting a free ride on the StemMachines by convincing the manufactures to offer version that come with Windows.
-they also get closer to their initial unifying their platforms and having Windows taking over the living room.
-It open many other doors to them, like cheap versions to compete against streaming boxes or for in-house streaming of games.
-Can now have their services available on different hardware, like Skype on PS4.
-they get out of shrinking market that made them lose money.
If it becomes it's own company, I feel like it would be the death of Xbox or the start of something huge.
Either they would continue on the same path they're on, which relies on spending more than taking in, and would result in a potential buyout of the brand or they adapt to a new market and change everything they're doing.
The latter could potentially result in more first party studios, or a completely different take on video gaming like the Wii.
Either they would continue on the same path they're on, which relies on spending more than taking in, and would result in a potential buyout of the brand or they adapt to a new market and change everything they're doing.
The latter could potentially result in more first party studios, or a completely different take on video gaming like the Wii.
Louis Cyphre
Banned
25:00 minute mark of the interview someone from the crowd asked if there is an opportunity to create shareholder value by separating parts of the company, and spinning off namely Bing and XBox. Gates said he doesn't think it makes sense for Bing. As for XBox they suggest it has huge potential so why not spin it off. Gates says there is stuff at work to bridge that with Windows gaming and they have an overall strategy. When asked if he would support the new CEO if he chose to spin the XBox off he says absolutely. That quote really doesn't mean anything in the context of things.
Here is the full interview,
http://www.foxbusiness.com/markets/2014/05/05/buffett-leery-social-media-stocks-ipos/
Here is the full interview,
http://www.foxbusiness.com/markets/2014/05/05/buffett-leery-social-media-stocks-ipos/