Unless Elop says the story is bollocks, who cares what some PR guy at MS says?
-
Hey, guest user. Hope you're enjoying NeoGAF! Have you considered registering for an account? Come join us and add your take to the daily discourse.
MS CEO candidate Stephen Elop said to consider selling Xbox business, killing Bing
- Thread starter ComputerMKII
- Start date
Unless Elop says the story is bollocks, who cares what some PR guy at MS says?
ZombiePlatypus
Member
Oh god, assuming they can get the same quality and creativity with their games like they did with OG Dreamcast, I'd just about die.
The boot-up screen, UI, dashboard, everything else, ALL LIGHTNING ALL THE TIME. MANDATORY.
Certainly it makes sense from some points of view (its enterprise and related services where MS makes its money).
Though thinking about it...I'm not sure anyone is that keen on getting into the super expensive market of high end game consoles. Its certainly not very profitable and the market is tiny compared to other areas of the game industry.
And really its hard to me to see it easily being sold. I mean Xbox is heavily tied into other parts of MS tech (Windows 8 being one). So what could expect to get from a purchase...the brand and whatever is left of goodwill, Ip rights to various first party games, hardware design rights, maybe some kind of license for the OS.
Though thinking about it...I'm not sure anyone is that keen on getting into the super expensive market of high end game consoles. Its certainly not very profitable and the market is tiny compared to other areas of the game industry.
And really its hard to me to see it easily being sold. I mean Xbox is heavily tied into other parts of MS tech (Windows 8 being one). So what could expect to get from a purchase...the brand and whatever is left of goodwill, Ip rights to various first party games, hardware design rights, maybe some kind of license for the OS.
Unknown Soldier
Member
Sapphire Dreams
Member
I am sorry but I find it hard to believe that a cooperation would invest billions of dollars on a device like the Xbox One only to leave the industry immediately afterwards. If they wanted to shut the Xbox division off they would have done it already instead of spending tons of money on a successor, I just don't see how is that practical at all.
The reason this is a concern now is because Balmer's out and a new CEO can shift direction. He was the one spearheading the Xbox and consumer hardware at the expense of billions and significant investors seem to have had enough.
I don't doubt that if the XBO is dominated by the PS4 like so many console warriors on here say will happen, they'll do something drastic with the brand, whether that's spinning it off, exiting the high-end hardware race or outright selling it.
LiquidSolid
Member
You get the part where they're hiring a new CEO, right? The entire point of it is to get someone that isn't Ballmer (though Elop is pretty bloody close).
And no-one's saying they'd do it immediately anyway, they could always keep the Xbone going for a while before getting out of the industry. Who knows?
something fishy
Member
I see this already got a response from the xbox division.
doesn't sound like a plan at all.
doesn't sound like a plan at all.
BengaBenga
Member
Why?
The money earned by selling the xbox companies and IPs, probably seperately as that will likely be worth more, could be spent on products that match better with the strategy of the company. Also by focussing on the other divisons they can invest more on those because they don't have to invest in xbox anymore.
Even if xbox is profitable, it still takes investment to get that profit out. If another division gets a better return on that investment it could be a good decision to let xbox go.
The Xbox division would be the last people to know.
LiquidSolid
Member
What are you talking about? Elop's still only a candidate for the CEO position (albeit the most likely one, as apparently both Gates and Ballmer favour him) so of course it's not official.
The PR department that released that response did it as damage control, not because they had any clue about the situation. They have a brand new system coming out in a couple of weeks and this report couldn't come at a worse time for them, so they had to try their best to discredit Bloomberg. It's a pretty ridiculous response really but credit to Microsoft's PR department, as it was funny and obviously worked on a number of people.
something fishy
Member
they're no more sure what will happen than anyone here?
fine. so nobody has a clue, but we'll assume the worst anyway.
fine. so nobody has a clue, but we'll assume the worst anyway.
iamshadowlark
Banned
He took out a succesful company so his previous employer could take them over.
Yeah I would think its pretty obvious by this point what kind of operation this is. Former high ranking Microsoft exec leaves the company to become the CEO of another company with some value to Microsoft. He then preceeds to drag the company and further more its asking price into the mud and suddenly the company ends up an aquisition for MS, with him receiving a mega-bonus and another high level executive position in the sale. He's now seemingly in the running to become CEO for MS.
Either this is a Series of Fortunate Events or MS is a bit sneakier than we give them credit for...
Not yet. They need a green light from EU first.
And? I'm talking about taking the market from cheaper android devices in developing countries, and they've done that.
Coulomb_Barrier
Member
The thing is, recent speculation is that Sony is incredibly well stocked for PS4 units at launch and beyond. It is increasingly looking likely XB1 will get pasted at launch by their rival and going forward. And that's the US.
If Xbox can't make money when it was dominating the market (or getting about as close to domination as MS is ever going to achieve), what is the outlook going to be when they are getting trounced by PS4?
There is little chance that any new CEO would see the logic in investing as much as they do now in such a market. It would make sense to pull the console prematurely like Xbox, cut funding significantly or, as is being rumoured here, sell the division's assets off.
If Xbox can't make money when it was dominating the market (or getting about as close to domination as MS is ever going to achieve), what is the outlook going to be when they are getting trounced by PS4?
There is little chance that any new CEO would see the logic in investing as much as they do now in such a market. It would make sense to pull the console prematurely like Xbox, cut funding significantly or, as is being rumoured here, sell the division's assets off.
LiquidSolid
Member
Read the fucking OP then? Because that's what the thread is based on, amazingly enough. I'm pretty sure Bloomberg has better sources than anyone in this thread or Microsoft's PR department.
Take a look at the current PS4 price in countries where Xbox One got delayed.
Yeah, suddenly competition is good. And what makes you think Sony would continue with PS+ without Xbox Live as a competition?
You are totally missing Microsoft's focus shift. Investors don't CARE about getting into the living room anymore. They want to focus on enterpise offerings, and the Xbox offers NOTHING towards that goal.
Sapphire Dreams
Member
Elope is a guy who says a lot of things but doesn't necessarily do them.
Huh, that does make some sort of sense.
That's a niche product made for one market dude...
Unknown Soldier
Member
It also costed them $1 billion dollars. That was the point I was making. MS is well known for pissing away enormous sums of money on absolutely nothing, that's what happens when you're an old monopolist who has grown fat on Windows and Office revenue for decades.
Zynga's cash on hand has been shrinking incredibly. Possibility of Zynga snagging the brand? A lot less than Valve or someone else.
They are interested in b2b, not consumer goods. Everything you mentioned was Ballmer's focus and he was shown the door.
I think its important for everyone here to realize that Microsoft is moving back towards business and away from consumers. If you think their being shortsighted, you're still looking at it from a consumer point of view.
Yes, because corporations are famous for their honesty. What did you expect them to say, of course they're going to deny it either it's true or not.
Coulomb_Barrier
Member
There is a totally different business outlook for MS compared to as little as 5 years ago.
It's hardly worth saying these days that Google and Apple are doing major damage to their Windows ecosystem. Their OS market share and revenue from that sector is going to continue to shrink (including that $2 billion a year profit from patent royalties).
So the future outlook, and all the members on the board know this, is not going to be the same. If they continue to sink and lose billions in loss-leading products like they have been doing for the last 10 years, the MS as we know it won't survive.
It's hardly worth saying these days that Google and Apple are doing major damage to their Windows ecosystem. Their OS market share and revenue from that sector is going to continue to shrink (including that $2 billion a year profit from patent royalties).
So the future outlook, and all the members on the board know this, is not going to be the same. If they continue to sink and lose billions in loss-leading products like they have been doing for the last 10 years, the MS as we know it won't survive.
Sapphire Dreams
Member
God, will the mouse ever be satisfied ?!
LiquidSolid
Member
Maybe. But if he pulled a 180 on the plans he made to get the job and just stuck with the status quo, I doubt he'll have the job for too long.
Crazier things have happened. See HP TouchPad.
KojiKnight
Member
I'd love to see the failed Nokia CEO take over microsoft... I'm sure great things would happen... did I say great? I meant funny. Funny things would happen.
Sapphire Dreams
Member
Wasn't that because of HP's bad financial state ? I mean according to their financial statement, they're not doing very well and thus aborting few projects make sense.
jhmtehgamr20xx
Banned
That is fucking laughable.
Holy shit, MS tried to launch a line of DUMBPHONES in 2010? What in the fucking hell?
Baleoce
Member
This.
EDD isn't losing money right now, and it hasn't for 5 years. Do I envision a future where Microsoft closes shop on devices that continue to lose money? Absolutely. They gave up on the Zune, and I see no reason why they won't give up on things like Surface in the future if things don't improve.
Hyperactivity
Banned
Just because Nintendo would get Rare's ips (and their old talent all seems to be asking to work with Nintendo with thos ips) and XboxLive, and they wouldn't be as anti-consumer, I'm going with the Nintendo Super WixBoxU Entertainment System 64
Nokia was already on the cusp of a downward spiral when he took over, and their direction at the time he came aboard wouldn't have fared much better. Hell, they were content with running freaking Symbian on their phones until Elop stirred them in another direction in 2011. Whether Windows Phone was the best decision is up for debate. People always conveniently leave out the fact that things are actually looking up for Nokia right now (http://www.theverge.com/2013/10/29/5041528/nokia-q3-2013-financial-report) and moving forward.
Happens all the time. It's easier to write off cash that's already been spent than to sell continued spend on a project to a prissy board.
Despite a record quarter, MS medium-long term outlook isn't great. It's biggest product isn't the guaranteed cash trough for shareholders it once was, Office is the same. It's losing ground in the home as people switch away from desk/laptops and onto tablets, it's pissing in the wind in phones.
Xbone's one saving grace is in that last space - if MS can build enough of a business and prove the basic concept of the vision that inspired it, the next version could really get MS into the home in a very meaningful way.
infiniteheteroskdasticity
Member
It is not terribly surprising that a new CEO brought in to shake things up would at least consider shaking things up. Microsoft has two pretty clear directions at this point. One, they could continue down the path they're on a double down on a hardware ecosystem and try to transition to an Apple like integrated experience company. The other is that they completely exit the hardware business and focus more on their enterprise and business services division and try to make the same transition that IBM did. My personal guess is that the former is the most likely outcome while the latter would be the better outcome for shareholders.
Either way I firmly believe that it is in the interests of gamers and gaming that Microsoft keep Xbox unless they can sell it to somebody with equally deep pockets. I consider a Google or Apple buyout of the division extremely unlikely. Samsung may be a possibility but the business isn't a money making machine that somebody that doesn't have a deep interest in the gaming industry would likely not consider it. That leaves a private equity led buyout/spinoff scenario which would be terrible for the business because it immediately loses access to the vast amounts of resources available at a huge corporation like Microsoft.
Either way I firmly believe that it is in the interests of gamers and gaming that Microsoft keep Xbox unless they can sell it to somebody with equally deep pockets. I consider a Google or Apple buyout of the division extremely unlikely. Samsung may be a possibility but the business isn't a money making machine that somebody that doesn't have a deep interest in the gaming industry would likely not consider it. That leaves a private equity led buyout/spinoff scenario which would be terrible for the business because it immediately loses access to the vast amounts of resources available at a huge corporation like Microsoft.
Chaostar
Member
I don't think anyone said that, this is just about Bing and Xbox as far as I know. Although I haven't read the entire thread.
Imperfected
Member
You're kidding, right?
They are never going to acknowledge this is the situation publicly until they already have a buyer. Even then, they're likely to try and avoid a major fanfare to both save face and assist the buyer in maintaining the continuity of the brand. They have no direct benefit from this information being public, it's not like they're going to be posting the X-Box division on Craigslist and need to get the word out. They're going to be shopping around in private for months and comparing offers to their reserve price before they make a decision.
The only reason they'd ever bother to tell the public they're in the market to sell the division is if the X-Box One launch goes so poorly that it begins to influence their stock prices, in which case announcing to investors that its on the chopping block could help staunch the bleeding. That's fairly unlikely, though, since the X-Box frankly means fuck-all to their corporate bottom line to begin with.
Even if they were literally talking to potential buyers right now, don't expect to hear anything about this for months. They wouldn't try to sell or disband the division until the holiday is over and their sell-through on launch units dropped below 100%, anyway.
MrMephistoX
Member
Samsung historically hasn't focused on media and software like Sony and that's their biggest gap. If they were smart and serious I would say Samsung buying Xbox IP and partnering with Valve by putting Steam OS on it would make a lot of sense.
That1BlackGuy
Member
Wouldn't be all that shocked if he went through with it; especially if he sees no viable ROI (short or long term) in the future for Xbox & Bing. If Microsoft wants a bigger bottom line, cut the losses and invest R&D towards where the money is. This wouldn't be the craziest thing that has happened in the business world though I wouldn't exactly consider selling the Xbox crazy.
Depends if there is a change in strat and if they see a future for it.
They axed aQuantive last year and wrote the entire 6.2 billion USD purchase price off like it was nothing. MS brain-trust has had no problem shooting parts of the company in the head and taking massive write-downs.