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Agreed.I wonder what the folks at ms are thinking as the ps3 plan unravels in their face

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Microsoft has invested billions of dollars into the Xbox internal documents and received back billions of dollars in sales. Overall though Xbox division has lost $4 billion from 2001 to 2005. [13] In particular, the Xbox hardware itself is a loss leader, since the console was sold at a loss even at its debut price. The losses deepened when sales of the Xbox increased and when the price was reduced successive times to compete with PlayStation 2 [14]. Microsoft predicted that it would not make a profit on the Xbox for at least three years. This prediction turned out to be correct; Microsoft Game Studios, Microsoft's game division in charge of Xbox development, had its first profitable quarter reported in January 2005, thanks largely to the success of Halo 2 [15]. Investor relations documents says that in the end of 2005 Microsoft lost more than 1 billion dollars [16]. The Xbox project never gave an annual profit to Microsoft according to these documents. In return for the money lost, though, the Xbox gained name recognition and a dedicated fan base.

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