As I've said before, the hardware is important as a device to Microsoft, but its not as important as it is with Sony and Nintendo. They depend on hardware sales as much as software.
If Microsoft doesn't sell hardware, literally most of their gaming revenue goes away Content, Services, etc. All of its linked to a the closed system.
Having the potential to hit 7 Billion people is much better than selling 100 million consoles. In the face of 7 billion potential customers, 100 million consoles looks like something off the $1 menu.
Yes and no, if you actually sell lots of stuff to 100-200m people, you make more than not selling anything to 7 billion people. That's like the worse marketing ever created. Technically, you can sell 7 billion consoles and 100 software sales per console for the 7 billion people... the problem is... 7 billion people aren't your customers.... its the same thing.
Its stupid marketing, or investment pitch... they could have sold 2-5 billion people phones... but they couldn't compete.... nobody bought them i.e. Windows Phone.
The market they are going in.... is more saturated per dollar than consoles or PC gaming.
As a venture capital and angel investor who has heard many pitches, I’ve compiled a list of mistakes and things to avoid if you are an entrepreneur seeking angel or venture financing.
www.forbes.com
The first one is what Phil is doing, its a big no no in pitches... "
we just need 10% of the 7 billion people on the planet"
Yet, they can't get people to buy in their intergrated Store in Windows.... literally the Store is install out of the box and they can't sell software.
Mistake 12: Giving me clichés
Phrases to avoid:
- “All we need is 1% of the market” (unlikely you will get that)
- “We will get huge viral usage” (unless you show me early traction, that will be difficult to believe)
- “This product will market itself” (no, it won’t)
- “Google will want to buy us” (maybe, but not likely)
- “Our projection numbers are conservative” (just once I would like to hear an entrepreneur say, “Our projections are wildly optimistic”).
They literally couldn't get customers for gaming on their own OS i.e. PC see Games for Windows Live and Microsoft Store.... they're basically bailing. So, now they're going to an oversaturated market i.e. cloud gaming where they are actually about 1-10 years behind the competition.... good luck as they say.