Microsoft's Mehdi: Xbox 360 Still Has 3 Years Of Life In It

[Karloff]

Microsoft's Mehdi: Xbox 360 Still Has 3 Years Of Life In It

Xbox One won't make a loss at retail says Mehdi, describing Microsoft's "big bet".

Yes, Xbox One is coming [http://www.escapistmagazine.com/news/view/127449-Xbox-One-Out-November-22nd], but that doesn't mean Xbox 360 is going. Far from it, says Microsoft's Yusuf Mehdi, who estimates that Microsoft's old console still has at least 3 years of life in it. "We're going to continue to invest in Xbox 360, and the two devices can work in concert," says Mehdi. "So it's not like the day we ship Xbox One your 360 won't work." There's still plenty of cash to be made in the tail of this console's life cycle, and Microsoft's in no hurry to cut that tail short. In fact, it intends to ship over 100 new games for the 360 even after Xbox One's launch.

This news should please publishers, who know that customers have invested heavily in their old consoles. Mehdi estimates current install base at 300 million units, and expects the Xbox One to outsell that figure. But 300 million units means 300 million potential customers for the old stuff, particularly since the next generation won't be backwards compatible [http://www.escapistmagazine.com/news/view/124214-Xbox-One-Not-Backwards-Compatible]. "We can grow not just top line revenue but also profitability," says Mehdi, and Microsoft's including Xbox 360 in that profitability.

Mehdi also commented on the 'sticker shock' that comes with the Xbox One price tag [http://www.escapistmagazine.com/news/view/125111-Microsoft-499-Xbox-One-Will-Over-Deliver-on-Value]. Mehdi described it as a "big bet", saying that the added voice capability and other value added make the cost worth it. The intent is to "break even or even low margin" on the Xbox One, eliminating the loss so often made on hardware sales. Game sales, Xbox Live and other services represent bonus cash for Microsoft when Xbox One hits shelves. Hardware cost reduction will follow eventually but nobody, least of all Mehdi, is prepared to say precisely when that will happen.

Source: Citi Global Conference [http://www.media-server.com/m/p/ng9deaui]


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[jurnag12]

I apologize in advance for my obviously stupid, missing-the-point and inflammatory outburst:

*ahem*

"THEN WHY ARE YOU PUTTING OUT A HALF-FINISHED FOLLOW-UP CONSOLE ALREADY, YOU COMPLETE AND UTTER [Data Expunged]?!"

 

[Gearhead mk2]

This raises the question of WHY ARE YOU SO EAGER TO GET TO THE NEXT GEN if your old console still has life in it? Is Crytek bribing you?

 

[MCerberus]

It'll only have three years or more left if they don't come out with any new updates that brick their system.

 

[L34dP1LL]

3 Years eh? Well, no need to purchase a new console on day one then.

 

[Johnny Wishbone]

Of course the console hardware itself has about 3 years of life. Basically that means that they expect the console to have the necessary horsepower to still be able to play games developed in the next 2-3 years.

What they aren't telling you is that Xbox Live for the 360 only has 6 months to 1 year of life. Since the 360 and the Xbone will use 2 different "Live" networks and server farms, they aren't going to keep the old one running for very long after the Xbone debuts. They'll shut down Gold subscriptions for the 360 and then start peeling away regular features of Live for the 360 until basically every 360 is a standalone console. Then they'll tell you how you need to "upgrade" to an Xbone if you want to get all those features back plus all the "exciting" new features the Xbone offers!

 

[TiberiusEsuriens]

They really have destroyed any trust I had in the company, haven't they?

Haha I am completely neutral towards all this console war stuff, but even I could help but smile, imagining his thought process as "we screwed with the customer so much it will take them 3 years to trust us enough to buy an XBone."

Honestly though, he has a really valid point. The tail end for making PS2 games didn't really slow down until 2010, with a few still tricking in to this date. There will always be a market, even if smaller, for older console games. Especially with Xbox One having a limited regional release I'm surprised he didn't make that number larger.

 

[Teoes]

Well they're doubtless going to be releasing games on both systems wherever possible, which means that for the next three years a decent portion of Xbone titles are going to be throttled and hamstrung so that the 360 can still handle something similar, yes?

That bodes doubly well for console ports to PC!

(Everyone's a cynic)

 

[Quiotu]

Honestly I think they're just trying to match Sony's '10 year cycle' for their consoles, and I don't think it's a bad idea on their part. PS2 still had some real gems of games after the PS3 was released, while Microsoft couldn't wait to drop support for the Xbox after the 360 came out.

This was my biggest concern with their next gen hardware, that they'd suddenly drop the 360 like a bad habit when the Xbone launches. They do have a history of doing this very thing with previous iterations of Windows, as anyone with Windows 7 has seen with the mountain of shit the last few weeks of patches have done to it. If they really do support the 360 for another 3 years, this is a good change by them. If they say they are but just slowly pull features from it until it's just an empty husk by the end of those 3 years, people are gonna remember that.

 

[Neurotic Void Melody]

Well aren't microsoft just soooooooo nice to us humble customers? I feel privileged just being allowed to look at my xbox now.

Also, i'm pretty sure that every console has continued a life after it's love-child is released. What i see here is a 'Mr state the fckin obvious' statement.

I am...enlightened

 

[Worgen]

I like how every console maker says their old system has life left in it, but its always a dirty lie and at most they release 1 or 2 games for it.

 

[Lightknight]

Due to the reception of the of the XBO likely being much lower than expected, of course they'll want to expand the system's lifespan as much as possible as that translates into software sales that the XBO appears to be shaping up to lose to the ps4 in the short term at least (ps4 has sold out all six versions of its console with 4 in the top 100 sellers of 2013 so far on Amazon. XBO only has two versions with the launch version selling out and three spaces below the ps4's launch version and the standard not on that list at all. Every once in a while Sony adds more consoles to the bundles and those sell out right away).

With that in mind, a successful post-new-console life of the old system like the ps2 had is very attractive and can keep the department afloat until they work out some kinks.

 

[CriticalMiss]

So there is no rush to buy an Xbone for the next three years, thanks for the heads up Yusuf. Although maybe this means there won't be a price drop for 3 years.

 

[Darth Sea Bass]

Sorry Mehdi mate improved voice controls ain't worth the extra price on the xbone and your deluded if you think otherwise!

 

[Frezzato]

Of course the console hardware itself has about 3 years of life. Basically that means that they expect the console to have the necessary horsepower to still be able to play games developed in the next 2-3 years.

What they aren't telling you is that Xbox Live for the 360 only has 6 months to 1 year of life. Since the 360 and the Xbone will use 2 different "Live" networks and server farms, they aren't going to keep the old one running for very long after the Xbone debuts. They'll shut down Gold subscriptions for the 360 and then start peeling away regular features of Live for the 360 until basically every 360 is a standalone console. Then they'll tell you how you need to "upgrade" to an Xbone if you want to get all those features back plus all the "exciting" new features the Xbone offers!

I agree with your sentiment, but Microsoft did support Live for the original Xbox for about three years after the debut of the 360. I think the real question is, when will they stop selling the 360? I think they'll continue to sell the 360 for maybe 18 months at most.

I think if anyone will drop the online portion first, it will be PS3, simply because their service (non-PS+) is free.

My biggest problem is that not all games support LAN play, which honestly seems like it should be mandatory for the most popular titles. Diablo 3 will be missing LAN play, but I guess at least they have up to 4 players on a single screen. This has basically been my mantra for purchasing games. If there's a heavy online-requirement, I won't buy it, and I've stuck with that mentality for the past 12 years. I've been against Xbox Live from the start, not because I always knew they would discontinue it, but because I've always thought a game should stand on its own merits and design, without the need for other players.

So, three years to buy a backup 360 and PS3. I should be able to swing that.

 

[Mr Fixit]

Well then I guess I have 3 years to save up for a PS4 then, plenty of time, thanks for the info.

 

[CTYR]

I...
I-I uh... what?!
No, seriously, in what way, shape, or form does any of this make sense?! When Nintendo released the Wii U, never did anyone ever say that the older console is still relevant in some way! Nintendo had made a new console that was better in multiple ways, therefore the older one, which was now considered to be inferior, was not supposed to live on; all games meant to be for a Nintendo console that are currently being developed have been strictly for the Wii U.
SOOOOOO...
Microsoft, you have just now, essentially implied that the new console you are making, which is meant to be superior, is not going to be truly relevant for another three years after its release. Does this mean that games for the 360 will still continue to be made? Does this mean you lack faith in your own product? If so, are you saying that you feel this new console is not up to the standards to release it properly?
Honestly, I doubt we'll ever really know the answers to those questions. All I know is what Medhi has just told the world is absolutely insane and goes against almost all marketing and all development that has been put into the lovely Xbone.
Ladies and Gents, I detect the possibilities of a lay-off, soon~!

 

[ThunderCavalier]

Of course the console hardware itself has about 3 years of life. Basically that means that they expect the console to have the necessary horsepower to still be able to play games developed in the next 2-3 years.

What they aren't telling you is that Xbox Live for the 360 only has 6 months to 1 year of life. Since the 360 and the Xbone will use 2 different "Live" networks and server farms, they aren't going to keep the old one running for very long after the Xbone debuts. They'll shut down Gold subscriptions for the 360 and then start peeling away regular features of Live for the 360 until basically every 360 is a standalone console. Then they'll tell you how you need to "upgrade" to an Xbone if you want to get all those features back plus all the "exciting" new features the Xbone offers!

...

I am scared. I am scared and terrified now.

On the other hand, I would LOVE to see what would happen if the CoD community realized that literally half of its games were unable to connect to Xbox Live suddenly. If Sony doesn't drop online for PS3 anytime soon, it's gonna be a huge shitstorm.