Stephen Elop Mulls Selling Xbox Business and Bing if Chosen CEO of Microsoft

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PCWolf

The guy who could not run Nokia wants to run Microsoft? I LOL'd! Talk about getting paid Millions to fail. No wonder MS is sinking. His one GOOD IDEA is to kill Bing. I loathe Bing!! I would vote for him as CEO just for that alone. Stupid Bing.

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yeungl

Why hire a losing company CEO to work for a Winning company?

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John Pombrio

Both Microsoft and SONY has lost money in big bucket fulls on their games divisions. These new consoles have been bad for business. SONY management has admitted they will lost over a quarter of a billion US dollars by next spring on the PS4. MS spent over $3 billion dollars on R&D alone. They should not have even started the new consoles. Has it helped their stock prices? Not at all. SONY is in a more precarious financial position having lost over $10 billion dollars in the past few years and the tiny profit they eked out this year is slipping away fast. Both companies should cut their losses and sell or spin off the games division.

The ONLY reason that they continue is not losing face by SONY and the bling the consoles bring to their companies by getting their names in the news. Apple knows all about bling.

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PCWolf

If they was losing all that money you think they are, they would have dropped out of the console market years ago. No company in its right mind would continue to throw money at a losing venture such as the PS4 if the PS3 did not make them any money.
As for Apple, all they did was make Chinese Sweatshop made iToys "Trendy". Funny, not so long ago, Sporting anything made in a sweatshop brought you Shame.

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Carlidan

Pretty sure they a losing money on the hardware side. But I'm pretty sure they are making a killing on software side. Like xbox live, halo, and game licenses.

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Insurgence

Nintendo is really the only one that has been making money out of the gate on new hardware, and that really is only since GC. MS and Sony usually start making money on the licensing once they get a decent games library and a couple blockbusters. While hte hardware usually ends up making money after they revise the hardware to make them cheaper.

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Carlidan

http://www.gamespot.com/articles/nintendo-continues-to-sell-wii-u-hardware-at-a-loss/1100-6412671/

Nope. Nintendo still loses money on hardware. But once a person buys a video game. They will make a profit. But just on hardware alone, they are losing money like the rest.

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Blackheart-1220

He just lost the race before it even finished

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Upyourbucket

Hire me Microsoft. I can make better common sense decisions than some of your rich out of touch A-hole candidates can.

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PCWolf

Having "Common Sense" is not a requirement of a CEO. they don't teach that in Business School. All they teach CEO's is "Short Term Gain" & "Cheap Labor 101"

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The Mac

as an MBA holder, i can assure you the teach much more than that.

Intelligence however, cannot be tought.

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Rift2

Just make me a CEO Christ I'll hire the right people and give them what the want not what they think they want.

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Weo

Just my opinion. Microsoft is doing well... at least in enterprise services. Apple and Google is focused more on the average consumer. I can see MS's push from a standpoint of enterprise or industry specific apps on phones/tablets that replicate a pseudo-desktop experience (i.e. mobile data and control for industrial software/hardware ecosystems for farmers, workers in the field, etc.).

Unfortunately, this successful strategy has left the consumer with limitations for everyday stuff, e.g. Facebook, Twitter, etc... even the UI customizability that I like on my Android phone. I'm more impressed with hardware specs of the Android and iOS devices for watching movies and reading magazines, but MS's success is really in enterprise. There's an adage, 20% of your customers make 80% of your profits.

In other words, it seems like MS's strategy is to work from enterprise designs on down, while Apple and Android are working from phone apps on up. Then you have R&D (MS spent $9 billion in 2011) and other areas to wade your feet in for the potential tax write-offs. Since the money is gone whether to the govt or on testing areas of the market (think Xbox and Skype), even a losing investment has potential, learning value, adds jobs, etc.

As a side note, Ford was lucky in its timing for loans. GM and Chrysler simply applied too late. Additionally, Ford did take assistance from the government bailouts (CPFF) and fought for GM and Chrysler because they share common suppliers (putting Ford out of business too). The relationship to this and OS companies? … China and Africa.

What was a huge factor in influencing the govt to bailout the auto makers? The potential growth in these emerging markets... not U.S.A. nor EU consumer demand/wants. If MS establishes a strong footing in these markets (enterprise would be better because of their finances and stability of revenue... ever visit a country where minimum wage was $200 per month and compare cell phones?) than it will have little competition in the enterprise arena.

If you think about it, if Apple and Android are fighting/focusing on market share amongst average consumers, Microsoft's competition in the enterprise arena is very small. It actually works towards Android and Apple on the consumer side too. Add to this Microsoft's $2 billion per year revenue on Android patent fees and you’re in a good place.

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MaximumMike

Interesting comment. I didn't know Ford took a bailout. Also, I had never heard the tie-in to China and Africa before, but it makes perfect sense. Good stuff. Will make for some interesting reading in the future. Thanks for posting.

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legionera

NOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOOO!

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hornfire3

+1 lol

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Ghost XFX

Nokia? Wuts that?

MS needs to get back to basics, but I wouldn't hire some no name guy that came from a company that imploded...

Technology Industry is a "What have you done for me lately?" business. If you've been screwing up as of late, there's no reason to think you won't do the same in the next place of employment. MS would be wise to leave this guy alone.

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Renegade Knight

They always sell off bits. What they should do is spin them off to the shareholders.

The shareholders would be far better off owning Microsoft Game, Microsoft Office, Microsoft OS, Microsoft Web. Etc. Some will flounder. But some will thrive more than they did as part of the larger company.

Selling off parts just gives the CEO a war chest to fritter away. Microsoft already has a war chest.

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Xenite

Many people may find it surprising that even though the 360 for the most part won this generation, they have made zero profit on the 360.

From a business standpoint if the XB One fails, it's definitely time to cut it loose.

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Goolashe

The PS3 recently jumped past 360 sales by around 300k or so, and they don't have the massive replacement cost history that microsoft had to take up. Microsoft probably only just broke even with the sales on games, and I think the size of the Xbone compared to the PS4, despite being weaker, shows that they might be trying to not have that cost again with the hardware (though we all know they'll somehow fuck it up again, such as shipping systems with fans put on backwards or covered in glue or something).

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RUSENSITIVESWEETNESS

Would be great to see Microsoft return its focus to the Windows operating system and Office Suite, leaving engineering to engineers, design to designers, whilst keeping the coked-up salesmen on a shorter leash.

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spokenwordd

Harshly stated but I agree....

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spokenwordd

Personally I think selling XBox is a plus I'd love to see M$ out of the hardware business. Especially since a lot of the stupid integration rollouts have been about selling XBox including the Metro interface on Win8.

Maybe this shifts M$ back to making the PC experience in gaming and otherwise their supreme focus. Hire the guy...

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fung0

Sounds bloody brilliant to me. I've been very leery of Elop, but maybe I misjudged him.

On the other hand, Bloomberg's source on all this is "three people with knowledge of [Elop's] thinking"... And their only response from Microsoft: "We appreciate Bloomberg’s foray into fiction and look forward to future episodes.”

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Baer

I am not impressed with either of these two choices as the Microsoft CEO. Certainly Nokia did not stay ahead of the times.
I think the Microsoft board should keep looking.

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Carlidan

Why would you want a candidate who wants to sell of xbox and bing, which both are one of Microsoft lucrative divisions .

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Sparx10

Actually analysts say that their Xbox division is losing about 2 billion dollars each year

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fung0

It's believable. The development costs on recent consoles have been immense, and the marketing outlays even bigger. Both Microsoft and Sony look on these products as 'strategic' footholds in the living room, and are therefore willing to subsidize them to a ridiculous extent. But neither of them will ever recoup this investment, if only because Big Content will never trust either of them to be their gatekeeper.

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Renegade Knight

Other analysis have said that Microsoft manages to sell the console at breakeven or better.

Losing money when your product is profitable doesn't really make sense.

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Carlidan

Also, it's not Analysts, it just one analyst. And his name is Rick Sherlund from Nomura.

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Carlidan

I've read the articles, but none of them mentioned or account what they get from titles and licencee's fee and Xbox Live. All the article mentions is that they are losing money on hardware. And in the article, it's not just Xbox losing money in the hardware side, it's also Sony and Nintendo. And if I remember correctly almost every previous consoles lost money in the hardware side.

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Peanut Fox

Nintendo sees profit turnovers for their main hardware devices pretty quickly. Especially since they haven't had massive 3rd party support since the mid 90's. They don't have a lot of choice.

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The Mac

They all lose money on the hardware. No body would be able to afford to buy one at a profit, let alonr the break even point.

The money is made up in licensing fees and inhouse games.

Its the old Razor Blade model. Give the Razors for free, and get all your money on blade replacements.

Same with printers.

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Carlidan

It's just one analyst making that claim that they are 2 billion dollars a year since xbox launch. Which doesn't make sense at all. That's 20 billion in lost revenue. Why would keep any company keep a division that makes the lose money for 10 years. It sooooo doesn't make sense at all.

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Sparx10

Well that $2.5bn loss has to have come from somewhere, so something at Microsoft is failing pretty badly. Not just their Surface tablets

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MaximumMike

I don't know how selling off one of your most successful products (Xbox) and another that you NEED to be successful (Bing) helps your overall strategy. Office is old news. There are many free alternatives that work just fine. It's certainly a staple of Microsoft that shouldn't be forgotten, but it's not a platform you build the future of your company on. But search, gaming, portable devices, PC's, and Microsoft's OS's are all converging. Anyone who can't see something this obvious clearly lacks the vision to steer a Tech giant like Microsoft. Also, Nokia is not doing so well. And considering that Ford was the only American automotive company that DIDN'T take a bailout, I'd say the Ford guy is the better candidate.

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Sparx10

Their Xbox certainly seems successful, but they are losing about 2 billion dollars a year on it. They're also losing another 500 million dollars from Windows Phone, Surface and Skype. Honestly, they need to forget about all these gimmicks and actually give the people an OS that they want and come up with some actual good products, or they're going to end up in the ground sooner or later

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Ashton2091

XBox is the only (consumer) product that Microsoft has successfully sold.

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fung0

Windows... Office... game consoles... phone software... phone hardware... tablet hardware... developer tools... server software... mice... keyboards... search engines... online advertising... cloud services... VOIP... media services...

It's easy to see that Microsoft is in WAY too many businesses. Most of them are loosely related at best, and many are actually in direct conflict with one another. Each has a different pace of change and a different profit picture. There's NO WAY they all belong under the same roof.

There really does come a time when you have to decide what you want to be when you grow up.

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jzsn

As expected from someone from a one dimensional mobile phone company that drove itself from #1 to irrelevancy.

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Jademan

F*ck Elop, he f*cked Nokia. The Ford guy, on the other side... He should be picked. 'Cuz sellin' things ppl are "tryin' to get used to" or are "used to" is pure dumb. I bet that Elop guy would sell microsoft to apple if given time/chance. No.

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yammerpickle2

The next CEO for MS needs to have a technological vision of the future. Alan is a great CEO, but I don’t think he has the vision of what MS needs to be to its customers in the future. Just look at Consumer Reports current reliability ratings for cars and you will see what I mean.

Elop just rolled Nokia over for MS, so he can sell out. Not exactly the kind of ethics I'd want in my CEO.

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Mikey109105

You mean he'll tell MS to screw off you no longer own XBox? Yeah, I think he just lost his candidacy.