Great insight Gman, absolutely no logic applied though.
If the xbox lasts 5 years there is no way they will still have a 1 billion dollar deficit. MS doesn\'t plan to lose 1 billion, that is the worst case scenario. By year 5 (worst case scenario) the xbox will pull out of the red and start making money with everything they sell. More likely, MS will start making money (cutting into their deficit) by the end of year two or three (the hardware itself will be far cheaper, the nvidia chip alone will be $50 by that time)--this is how the console market works.
If the xbox is around by year 5, it\'ll have a huge userbase and will have been profitable per console for a number of years (the xbox project as a whole may still be in the red though). It just might take 5 years to make up for losses incured over that time.
Also, if the PS3 is announced, chances are the xbox2 will be too and both will be on the news in the same stories. Again, if the xbox has made it to the 5 year mark there will be a significant number of loyalists and fanchise games to make xbox2 just as appealing as PS3.
You could argue that the xbox will die in 2-3 years and that is possible. But to say that it\'ll last 5 years and then die isn\'t very logical.
There is a quote from MS that said something like MS doesn\'t dabble in anything they do, when they go into a market they expect to dominate and usually do. MS is too sharp and proud a company to fail, cower and back out. For the most part, everything they\'ve done up to this point has been perfect; they\'ve made good decisions and executed well. The market has responded. I see no real reason to predict that xbox will fail or that xbox2 won\'t see release.
You use the DC as an example--this make little sense also. Sega was a company with a storied history of failure--MS has no such history, actually the two companies are polar opposites. At the six month market there were signs of a Sega collapse and people in the indsutry and news were whispering that the Sega was in trouble and going to back out. A year and a half later they did. So far there have been no such reports and people in the industry and on the news predict very good things from MS. People on forums and newsgroups are the only ones predicting failure and doom as they take a time out from their PS2.
