Microsoft Corp.'s (NASDAQ: MSFT) launch of the Halo 3 game took in a reported $170 million the very first day, as Doug reported this morning. Over at 24/7 Wall St., the reference to a "Halo 4" game coming in the future is peeked at. With Microsoft having made the single-largest take in entertainment history in any medium (games, music, movies, etc.), it is hard to think what the software maker is noodling about right now. After all, we are talking about a game release that broke every record in the entertainment industry for a division that lost nearly $2 billion last year.
Is the hype enough to keep Microsoft in the gaming business? Shareholders have been extremely patient with the company while it racked up loss after loss from the games division, as the company was pretty assured profit would eventually come. Microsoft even purchased Bungie Studios (makers of the Halo games) to cash in on sales from the Xbox platform's most popular gaming franchise.
That being said, Microsoft still loses money on each Xbox sold, and has publicly stated that it wanted to sell hundreds of thousands of new Xbox 360 consoles with the release of Halo 3. Here's a thought: would the game fans who shelled out $60 each for a copy of Halo 3 already own an xbox 360? Or, will the sheer hype cause 'new' Xbox 360 fans to shell out another $400 or so for the console?
Here is what Microsoft needs for the future: another grand slam hit. It's hard to argue that the Halo series of games have become the largest-selling franchise in recent memory for any gaming console. That's the good news -- it is possible to have a crazy/runaway/smash hit. But, can Microsoft publish a new title that at least comes close to Halo's success? Does it need this to keep the gaming division from staying in the perpetual red?
How long are we into the lifespan of the Xbox 360 console? Can Microsoft make a "must have" title to open the gates when the next generation of Xbox consoles hits the market (for example, the "Xbox 2010" or something)? It will take a huge hit (or hits) for Microsoft to get into profit territory with its gaming division. Halo 3 is a great start, but it can't be the last, end-all, be-all for Microsoft here.
[Disclosure: I own MSFT shares as of 9-27-07]
Here is what Microsoft needs for the future: another grand slam hit. It's hard to argue that the Halo series of games have become the largest-selling franchise in recent memory for any gaming console. That's the good news -- it is possible to have a crazy/runaway/smash hit. But, can Microsoft publish a new title that at least comes close to Halo's success? Does it need this to keep the gaming division from staying in the perpetual red?
How long are we into the lifespan of the Xbox 360 console? Can Microsoft make a "must have" title to open the gates when the next generation of Xbox consoles hits the market (for example, the "Xbox 2010" or something)? It will take a huge hit (or hits) for Microsoft to get into profit territory with its gaming division. Halo 3 is a great start, but it can't be the last, end-all, be-all for Microsoft here.
[Disclosure: I own MSFT shares as of 9-27-07]
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Reader Comments (Page 1 of 1)
9-28-2007 @ 3:01PM
John said...
Two words: Mass Effect