I read an article a little while ago about the Xbox 360 that makes some interesting observations about "success" and the like. It also contains various data on systems sold and percent market share will I will quote here. The whole article can be found at
http://www.gametunnel.com/html/section-printpage-126.html
I don't know this site well so it's credibility is unknown, but the figures seem reasonable enough to me. The sales are also as of 2005, but I noticed a rather large discrepency in the handheld numbers of units sold. The percents are near identical, but the numbers are off by about 3 mil.
In the spirit of beating a dead horse, I'll outline my side of things as best I can. I tried to make this as short as I could, but this post is not one for the weak... :lol
Are 2-3 million units REALLY worth 4 billion dollars?
Strategically, and long-term, I would obviously answer yes. I would also like to see some kind of source on exactly how much Microsoft lost (while I have no doubt it's in the billions, I try not to get into the habit of taking people's word for it). But undoubtedly Microsoft
planned to lose money on the Xbox. This is Microsoft, they're in the console market for the money. The goals and aims they had set for the Xbox were, in my mind, to get a foothold in the market, establish a fan base, and grow it from there. This is a long-term plan that is obviously going to show a loss in the short term. The Allies lost many lives taking the beaches of Normandy, but if they hadn't made that sacrifice they'd had never liberated Berlin. That analogy really isn't comparable, except to illustrate that long term goals often mean short term loss.
Are 2-3 million units really worth enforcing higher tariffs on third party accessory makers?
Third party accessories usually suck anyway. I only buy first party, tariffs on third party accessories does not affect or concern me in the least. Being able to buy an affordably priced console does. This decision, to me, is a positive one.
Are 2-3 million units really worth ushering in an age of fixes and micro-payments which stack on a monthyl fee?
What you call "fixes" I call "improvements." They aren't necessary to enjoy the game on it's own, but at least the option is there for those that want to make use of it. It's not mandatory, if you don't want to pay for the extras then don't, but those that do can.
Are 2-3 million units worth your competitor supposedly "losing out" when they make hundreds of millions of dollars in profit?
This is obviously the meat and potatoes of the arguement. The site I mentioned earlier sums up my feelings exactly:
it is important to note that sales doesn't = profit. For example, the Xbox has a narrow lead on the GameCube in terms of sales, but is 2 billion in the red while Nintendo has never had a negative quarter with GameCube.
He then goes on to say:
instead of looking at profit, I choose sales as they show clearly what the public values. Nothing speaks louder than where you put your money.
In my opinion, that drives the point home, and in a nutshell that is what my entire arguement is based on. The console that can be considered the "loser" is the one that is least valued by the public, the one with the lowest sales. And when looking at sales and market share we find that:
Nintendo Gamecube: 18.8 million with 15% of the market share
Microsoft Xbox: 21.9 million with 18% of the market share.
So right off the bat we see that the public values the Xbox over the GC. Now, also keep in mind that before this generation Microsoft literally had 0% of the market share. So in one console generation Microsoft's market share has increased by 18%. Nintendo with their Nintendo 64 sold 32.9 million units with 23% of the market share. They declined in both system sales and in market share. So the public values the Xbox and PS2 more than the GC, the GC was Nintendo's worst console in terms of system sales and market share, and yet you still see the Gamecube as a success, as victor over the Xbox?
You also spoke of seeing trends, and certainly trends can be derived from this data. In fact, looking in terms of raw sales and market share Nintendo has actually been declining for
four generations now. If this trend continues it will be harder and harder to hide behind a profit margin and say Nintendo "won" the console generation.
So to sum it all up. Microsoft gained 18% marketshare and sold 3 million more systems than Nintendo did with their GC. Nintendo lost 8% of the market and sold less systems than either Sony or Microsoft. Is losing marketshare and milllions of fans worth turning a profit in the next fiscal quarter?
Even if you answer "yes" to that (which in my opinion is not good business sense) then you still can't deny that the people have spoken, and with their hard earned dollars they have voted the Xbox and PS2 to be systems worth having over the GC. To say the GC didn't lose the console round because the company turned a profit doesn't make a lot of sense to me.