Microsoft’s Xbox brand will be “sold to someone like Sony”, failure is “inevitable”

Monday, 21 January 2013 10:10 GMT By Nick Akerman

The analysts are at it again. This time, a US firm predicts Microsoft’s Xbox brand is on a downward spiral.

Could MS run into severe trouble across the next three years? One analyst certainly thinks so, beginning with the company’s console division.

“The entertainment division will be spun off, sold to someone like Sony or possibly Barnes & Noble, or dramatically reduced in size,” says Forbes contributor Adam Hartung.

“Unable to make a profit it will increasingly be seen as a distraction to the battle for saving Windows – and Microsoft leadership has long shown they have no idea how to profitably grow this business unit.”

Hartung also suggests the company will be hit with “enormous layoffs over the next three years”, alongside the closure of Microsoft’s online division as the organisation plows money into combating iOS.

“Microsoft makes more than 75 per cent of its profits from Windows and Office,” he added. “Less than 25 per cent comes from its vaunted servers and tools. And Microsoft makes nothing from its Xbox/Kinect entertainment division, while losing vast sums in its on-line division.

“No matter how much anyone likes the non-Windows Microsoft products, without the historical Windows/Office sales and profits Microsoft is not sustainable.

“Failure is already inevitable. At this stage, not even a new CEO can save Microsoft. Game over. Ballmer loses. And if you keep your money invested in Microsoft it will disappear along with the company.”

Scathing words indeed. Thanks, MCV.