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News TheVerge: After Xbox testimony, Apple tells Microsoft to put up or shut up

Zeroing

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Lmao even in a lawsuit ms won't provide Xbox financials properly. Remember the good old 360 days when they couldn't wait to tell us everything!
That’s because they were winning*
*nintendo Wii does not count

after all the years of bragging when things didn’t go well in the next generation they decided it was best to shut up and pretend all is well.
 
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I can actually see the Xbox One hardware not making a profit. I mean... they sold this thing for under 200€ and on special sales I've seen it for 130€ and less.

But it is hard to believe that they never made a profit on the last gen machine which wasn't exactly cutting edge at any point in its life. I hope they produce documents, but I don't think we are going to see any of it. It will be behind closed doors, just like a lot of the stuff that came after the initial fuck up of making all the documents public by accident.
They did also made no profit on the Xbox360....you know RRoD😉
 

Thirty7ven

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So they make a loss on Xbox hardware. They're directing all efforts to get more people on to Game Pass, a service which is not profitable. And they've just paid $8billion to buy a set of game studios just to give the games away on a sub model that doesnt turn a profit on a system that they sell at a loss.

Who is greenlighting this shit?

Don’t know if you noticed but Silicon Valley has basically changed the rules of the game. Only companies that need to make profit are the smaller ones, the big ones can go a decade losing billions while draining the competition out of the market. Said losses are used to explain low wages and poor working conditions, while extreme revenue and growth leads to huge paydays for shareholders.
 
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MonarchJT

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MS allowed themselves to put in a position of being ridiculed.
It just shows why MS got Involved in the first place. They want to get a chunk of that iOS user base even if it means becoming a sort of parasite.

so yeah MS is not that selfish company that wants to save us ( consumers ) from evil Apple! That’s what the lawyer pointed up and everyone knows it. It could be damaging in the perception of the brand.
ridiculed how and by who? what are you talking about?? ...those corporations are not driven by fanboyism. Apple asked to see data on how Ms wouldn't make money selling hw because they doesn't believe it ... not to let kids laugh about it on a forum
 
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Smoke6

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lmao. Are you really suggesting Microsoft is committing fraud?

Of all the shitty takes I’ve read in the first page of this thread, this one takes the cake.
I mean, everyone’s in it for the money right?

you explain it!

havent gotten sales figures in ages for games and barely get them for consoles.

shelling out shit tons of money on a service and console that’s not making a profit yet any financial reports are always clumped together with other divisions making it seem profitable when it’s clearly not!

MAU’s are the sketchiest of them all as they don’t even have over a 100 mil console between this gen and last gen unless there are several still playing the 360!

Series s/x don’t have any first party games and most the shit on gsmepass. You gaming division just spent over $10bil in acquisitions yet you’re reporting record profits still?

sounds fishy sir, is all I’m saying and you can laugh all you want. We’ll find out soon I guess
 

mejin

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Apple tells Microsoft to put up or shut up over Xbox profitability​


Now the title is complete.

"Now, Microsoft is caught between giving up information that could help in court and giving up business secrets to a longtime rival."

She thought she was talking to MS fans. Why MS got involved in this fight I'll never know. They played themselves.

You can't spin in the court.
 
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MonarchJT

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I mean, everyone’s in it for the money right?

you explain it!

havent gotten sales figures in ages for games and barely get them for consoles.

shelling out shit tons of money on a service and console that’s not making a profit yet any financial reports are always clumped together with other divisions making it seem profitable when it’s clearly not!

MAU’s are the sketchiest of them all as they don’t even have over a 100 mil console between this gen and last gen unless there are several still playing the 360!

Series s/x don’t have any first party games and most the shit on gsmepass. You gaming division just spent over $10bil in acquisitions yet you’re reporting record profits still?

sounds fishy sir, is all I’m saying and you can laugh all you want. We’ll find out soon I guess
yes, what you writing is laughable at best. Without even saying that the American laws against fraud are perhaps the heaviest on the planet.
 
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Heisenberg007

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? I was saying the series S is not being sold at loss. Hence they really need to show proof of what they are saying!
I understood that and I agree with it. What I'm highlighting is additive to it.

It's not just the Series S. They also need to show proof for all the consoles they ever sold.
 
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Kokoloko85

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MS/ Bill gates made money through all sorts of dodgy means back in the day. The lolita express with Epstein lol... Just joking....
 

DaGwaphics

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That's what everybody thought when Microsoft said that they never ever made any profits on selling Xbox hardware. Apple lawyers are saying that Microsoft should provide official documents to substantiate that claim. Because the general consensus in the industry was that after the initial launch period to gain market share, consoles are sold at a profit in the subsequent years.

And that could very well be true. But do they ever offset the early losses and the R&D expenditure? That's the question. If you sell at a $100 loss to start after spending millions in R&D, recouping $10 or $15 a console late probably wouldn't make a dent. Then you have repair and servicing costs, etc. All of which need to be factored into the pricing of a standalone product if there are no "blades" to recoup those costs on.

The whole distinction is a bit ridiculous anyway, basically you'd be putting MS and Nintendo (possibly Sony also) on opposite sides of this situation because their hardware is quite profitable for them.
 
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Zeroing

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ridiculed how and by who? what are you talking about?? ...those corporations are not driven by fanboyism. Apple asked to see data on how Ms wouldn't make money selling hw because they doesn't believe it ... not to let kids laugh about it on a forum
It’s a court room where a lawyer is calling a company for lying… how can not that be ridiculous?
 

Zeroing

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I understood that and I agree with it. What I'm highlighting is additive to it.

It's not just the Series S. They also need to show proof for all the consoles they ever sold.
Exactly you are right! if you back up Epic and start saying stuff on court without data to validate one of the biggest points you are tying to use against Apple .. what’s the point? MS is not there for moral support. It’s just a ridiculous situation.
 
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PaintTinJr

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People don’t buy products because they feel sorry for trillion dollar companies.
I was meaning sympathy for the xbox brand - as the charity case in the trillion dollar company. I may not be typical, but seeing receipts for them subsidizing the xbox hardware division would make me more inclined to support that division, when they produced good games - because the bravado xbox pitch that I turn off from and don't like, is completely neutralized for me if they are a charity case division.
 

PaintTinJr

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Exactly you are right! if you back up Epic and start saying stuff on court without data to validate one of the biggest points you are tying to use against Apple .. what’s the point? MS is not there for moral support. It’s just a ridiculous situation.
I wonder if Microsoft could use an intermediary solution to the receipts situation. Imagine if they showed the P&L to a third party like EA, and then got them to testify to the same statement - that xbox hardware has always been sold at a loss.
 

reinking

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nah. MS wants gamepass on Sony and Nintendo's platforms. This Epic lawsuit is their way in. If Epic wins against Apple, it sets a precedent that MS can use to force themselves onto their competitors platforms and end up undercut every single sale by offering it on gamepass for a small monthly fee.

MS isnt stupid. They know their consoles cant compete with Sony and Nintendo, and they need those 100-200 million nintendo and playstation owners to make gamepass successful.
I agree with you that they want their services on competitors platforms. However, the very argument MS attorneys are making, that consoles rely on software and services to turn a profit, would actually help Sony and Nintendo if they were to go up against them in court trying to get into their marketplaces. I felt it was a mistake for MS to get involved when this whole thing started and still do. They are making statements in court that they might have to maneuver around in the future. The only way it makes sense (IMO) for MS to get involved is if they really think Game Pass is going to generate enough income on iOS to make it worthwhile.
 
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Zeroing

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I wonder if Microsoft could use an intermediary solution to the receipts situation. Imagine if they showed the P&L to a third party like EA, and then got them to testify to the same statement - that xbox hardware has always been sold at a loss.

I think it’s is more of a MS not having anything or being afraid it would leak to public. They could show the documents to the jury only…

I have no idea and I doubt Apple would win anything by knowing “secrets” from MS. If anything MS would gain if they could peek into Apple…
 

Zeroing

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I agree with you that they want their services on competitors platforms but the very argument MS attorneys are making, that consoles rely on software and services to turn a profit, would actually help Sony and Nintendo if they were to go up against them in court trying to get into their marketplaces. I felt it was a mistake for MS to get involved when this whole thing started and still do. They are making statements in court that they might have to maneuver around in the future. The only way it makes sense (IMO) for MS to get involved is if they really think Game Pass is going to generate enough income on iOS to make it worthwhile.
I find interesting how Nintendo and Sony didn’t wanted to get involved yet MS is using the console hardware sold at loss argument. Why??

At first I though Nintendo and Sony wanted to be neutral because they didn’t saw this as a “war” worth fighting but more and more it seems MS had bet if this pans out they will infiltrate into everything/ ecosystem thus making sense why Sony and Nintendo not being on their side.
 

azertydu91

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Lol I don't think any of them are complaining right now.
Another thing shareholders complain all. the. time.
When they lose money because they lose money and when they get money because they could be getting more.
I knew someone that had a small company (I mean compared to MS) they were buying and reseling to other companies(kinda like dropshipping but legal) and with Covid they had a fantastic year like 4 times the annual previsions yet shareholders complained ....They complained when they got 4 times what they were supposed to.
Now imagine telling them they could have had more if one of the branch was scrapped,what do you think they'd want?
Because as shareholders the only thing they care about is profit and the return they'll get from it.
 

ReBurn

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Well yeah they want more money, obviously, and divisions that don't make profit mean they get less money because of it.
That's kinda shareholder 101.
That's not shareholder 101. Investors understand investment, risk, and the concept of long term gains. People invest in companies that are unprofitable or are doing unprofitable things because they're betting that long term those things will become profitable and their investments will pay off.

People invested in Tesla for years even though it didn't manage a profit until 2020. The reality is that the planet is going to run out of fossil fuels and Tesla would be set to flourish as the shift to solar energy and electric cars happens. That's why they paid hundreds per share for an unprofitable company. There's huge potential for that stock to be insanely valuable. Tesla would have still lost money in 2020 had it not been able to sell environmental regulatory credits it didn't use. Yet the stock is hundreds per share.

Gamepass is a new business model that has the potential to pay off for investors if consumer behavior in regard to video game consumption changes. Microsoft is betting that more people are going to want to subscribe to a game library instead of spending money to build their own. Investors in Microsoft are typically comfortable with less short term gain in anticipation of better long term gain if that's how it turns out.
 
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DrAspirino

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Microsofts plan when they decided to create Xbox


Random guy at a meeting: What about Sony?
Bill Gates: HERE. HAVE EVERYTHING YOU NEED. E V E R Y T H I N G.
 
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skit_data

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Random guy at a meeting: What about Sony?
Bill Gates: HERE. HAVE EVERYTHING YOU NEED. E V E R Y T H I N G.
Best part is the Sony TV in the background watching ominously

It’s funny how both these subdivisions were created out of fear and anger

Playstation was created out of anger because Sony got pissed at Nintendo for backstabbing them when creating the CD add-on for SNES

Xbox was created out of fear of Sony dominating all entertainment electronic devices outside of computers

Maybe Yoda was right all along, I bet Nintendo was created on Suffering and Hate
 
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laynelane

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yes but why are they even there? Why aren’t Nintendo and Sony there too? Since they are tying to spin this into a console argument…

this lawsuit has no focus and started by the wrong reasons. And I’m the one who is hoping Apple gets a beating.

Microsoft involved themselves in this trial.

Microsoft supports Epic games in Apple lawsuit

Why would they do that? Apple blocked xCloud on their devices, for one.
 

SLB1904

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As soon as they hit that 2 cap, you are going to see them expand more.
And they have been flirting with it for a while, but it's makes these Bethesda deals seem like nickels and dimes.

Literally based on their current market cap, Bethesda cost them 75 cents.

Nobody cares in the long run.
Market cap isnt money
 
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Zeroing

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Microsoft involved themselves in this trial.

Microsoft supports Epic games in Apple lawsuit

Why would they do that? Apple blocked xCloud on their devices, for one.
I make questions to make people think… I know MS got involved in by free will and they want their streaming service on iOS. Their motivation is not to save us from Apple closed ecosystem… although some people really believe that.
also we have people believing Apple is innocent. The 3 companies involved are the same.
 

azertydu91

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That's not shareholder 101. Investors understand investment, risk, and the concept of long term gains. People invest in companies that are unprofitable or are doing unprofitable things because they're betting that long term those things will become profitable and their investments will pay off.

People invested in Tesla for years even though it didn't manage a profit until 2020. The reality is that the planet is going to run out of fossil fuels and Tesla would be set to flourish as the shift to solar energy and electric cars happens. That's why they paid hundreds per share for an unprofitable company. There's huge potential for that stock to be insanely valuable. Tesla would have still lost money in 2020 had it not been able to sell environmental regulatory credits it didn't use. Yet the stock is hundreds per share.

Gamepass is a new business model that has the potential to pay off for investors if consumer behavior in regard to video game consumption changes. Microsoft is betting that more people are going to want to subscribe to a game library instead of spending money to build their own. Investors in Microsoft are typically comfortable with less short term gain in anticipation of better long term gain if that's how it turns out.
Sure but look at all the time they asked MS to axe the Xbox division.
That's not the same as investing in Tesla as a whole.Shareholders see the they get less money with Xbox and that they don't have faith in it (granted they may be right or wrong and probably knows as much as the most ignorant poster that there is on gaf).
And I don't think a loss leader strategy is going to reassure shareholders but tahnkfully the XSX is selling quite well so maybe they will be happy about it.
 

Zeroing

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Best part is the Sony TV in the background watching ominously

It’s funny how both these subdivisions were created out of fear and anger

Playstation was created out of anger because Sony got pissed at Nintendo for backstabbing them when creating the CD add-on for SNES

Xbox was created out of fear of Sony dominating all entertainment electronic devices outside of computers

Maybe Yoda was right all along, I bet Nintendo was created on Suffering and Hate
Do want laugh? Back in the 90s Microsoft saved Apple for going bankrupt. Why? So that MS could have the Apple users using internet explorer!! Yep!
 

azertydu91

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Do want laugh? Back in the 90s Microsoft saved Apple for going bankrupt. Why? So that MS could have the Apple users using internet explorer!! Yep!
Even funnier is the whole history of Yahoo...The company that could've bought google algorythms, then google for like a million, then youtube.
Then refuses to get bought by MS for 44 billions that has been sold for 4 billion to verizon.
 

Elog

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I agree with you but this is quite a controversial statement here, a lot of people claim it is overall losing money.
Their own numbers clearly indicate that they are operating on a loss basis in the gaming division right now.

They report the operating profit for a division that consists of Windows, Advertisement, Surface Pro and Gaming/Xbox. We know that Advertismenet and Surface Pro are profitable but not by how much - so lets for this discussion assume it is +/- zero which is being nice to the Xbox/Gaming division. For many years MS reported the Windows business separately with a fairly consistent range of operating profit margins. They also report how much revenue they have from the Windows part.

If you do the simple math of historical operating profit margin numbers on the Windows business, assume zero contribution from ads and Surface Pro (which is the best case for Xbox/Gaming), Xbox/Gaming is in the red by quite a margin and has been over the last two years.
 
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Old Empire.

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Sony charging developers for crossplay more scandalous than MS not making much from hardware sales. The priorities of the gaming media all messed up.

This likely the same with Sony. They sell at a loss to heap a return later.
 
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skit_data

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Sony charging developers for crossplay more scandalous than MS not making much from hardware sales. The priorities of the gaming media all messed up.

This likely the same with Sony. They sell at a loss to heap a return later.
If i understand it correctly Apple take issues with the claim they never make profit on a sold console, something that seems somewhat unlikely unless MS are taking R&D etc. into account when calculating that loss.
 

Clear

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Sony charging developers for crossplay more scandalous than MS not making much from hardware sales. The priorities of the gaming media all messed up.

This likely the same with Sony. They sell at a loss to heap a return later.

Why is it scandalous? Its a simple balancing mechanism where *IF* monetary transactions carried out external to their ecosystem add significant load to them as servers of said service, they get reimbursed to a degree.

Its actually very fair and entirely transparent to the user.
 
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Zeroing

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Sony charging developers for crossplay more scandalous than MS not making much from hardware sales. The priorities of the gaming media all messed up.

This likely the same with Sony. They sell at a loss to heap a return later.
You know… charging for online was pretty scandalous too… yet after a generation of gaming journalists /YouTubers/gamers saying it was for the best… here we are, 3 consoles now have it.

Everyone picks what a side. Without looking at the broader spectrum of the gaming industry.

Also Apple gets a lot of media attention it’s the sweetheart of the USA, MS decided to join the fight against Apple so, we will be reading a lot about Apple, Epic and MS until the court rules their decision
 
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Chiggs

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Microsoft is just doing what they do best: fucking with more innovative companies in hopes that it will take them down a peg or two financially and emotionally.

In this case, their proxy pawn is Epic; in the recent past, it has been Toshiba.
 

Old Empire.

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If i understand it correctly Apple take issues with the claim they never make profit on a sold console, something that seems somewhat unlikely unless MS are taking R&D etc. into account when calculating that loss.
Not an extraordinary statement from Microsoft. Every new console box arrives with a new CPU, GPU, controller, hard drive, audio plug ins, motherboard, cooling fan, package holds everything together, contact interface UI none of that cheap.

Apple overcharging for Phones, don’t understand the model or just dance around it and playing dumb here. It’s well known for decades Sony and Microsoft reasoning to continue making consoles is the compensation payouts are large enough to make it profitable. Big developers have to give 30 percent of game sales to both companies.

. Plus there is manufacturing costs to consider as no company will build consoles for free.
 
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Old Empire.

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Why is it scandalous? Its a simple balancing mechanism where *IF* monetary transactions carried out external to their ecosystem add significant load to them as servers of said service, they get reimbursed to a degree.

Its actually very fair and entirely transparent to the user.

The documents reveal, only reason Sony enabled crossplay is they got a payment for it. They had no interest this was pro customer. Sweeney even admitted Microsoft has not asked for extra money to put crossplay on its system. Sony got greedy fingers.
 
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Jan 29, 2019
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HW near the end of the 360 lifespan and possibly the X1 lifespan.
I recall MS stating that they didn't want to lose money on the one hardware sales... That may have changed after release, but that what their intention was.

I'm sure that the PS4 was profitable not too long after release as well.

The only console manufacturer that I am sure they always made money on hardware sales alone was Nintendo since the Wii.
Still it is strange that the MS witness would talk about all of this and not provide the requested documents that could prove/disprove the witnesses testimony.
Sometimes that kind of move forces companies to release information that they did not intend, if wonder if that could happen here, we might end up with actual console sales figures!