The recently-unveiled Xbox One X is an impressive piece of hardware, but explaining its existence is an increasingly befuddling task. Xbox boss Phil Spencer has admitted the Xbox One X is a niche product most players won’t see much value in, and in another interview, he let slip Microsoft isn’t even making a profit on the machine.
When Business Insider asked Spencer whether Microsoft is making any money on each Xbox One X sold, he offered up a straightforward “No.” He then elaborated slightly on his overall plan for the Xbox One X…
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“I don’t want to get into all the numbers, but in aggregate you should think about the hardware part of the console business is not the money-making part of the business. The money-making part is in selling games.”
That’s all well and good, but again, Spencer admitted most people are going to choose the Xbox One S over the X, so are they really going to sell that much software for the souped-up system? Typically, when you make a niche product, you price it on the high end so you can at least make a profit from the few diehards who will be willing to buy it. With the Xbox One X Microsoft has make a limited-appeal system, that also isn’t profitable. Their upcoming software lineup is also fairly anemic, so the “we’ll make up the loss with software sales” doesn’t wash.
At this point it really seems like the Xbox One X exists purely to one-up the PlayStation 4 Pro. Hey, if Microsoft wants to eat into their profits in order to win a moral victory over Sony, that’s their choice, I suppose. Personally, I would have taken the research and development money sunk into the Xbox One X and invested in more exclusive games, but that’s just me.
You can check out WWG’s latest Xbox One coverage right here.
[via Business Insider]
