Xbox division down $4 billion

Everyone knows that since its inception, Microsoft's Xbox has been a money-loser. The argument always was that sales of the box would drive sales of Microsoft's own game titles as well as hefty licensing fees from third-party publishers.

But now, according to Forbes, comes word that makes it very difficult to imagine that the Xbox could ever have been an effective loss leader.

Forbes says that the Xbox division has lost $4 billion since 2001. Four. Billion. Dollars.

That's a lot of money, even for Microsoft, which Forbes also says has a war chest of $40 billion in cash.

Just before Thanksgiving, Microsoft will launch its next-generation console, the Xbox 360. The early word is that the 360 will also start its life as a loss leader, though Redmond insists the new box will soon be a moneymaker.

Either way, it's got a long way to go to get back to even, and though Microsoft is a rich company, it surely doesn't want the Xbox 360 known as an albatross around its dividend-paying neck.

About the author

Daniel Terdiman is a senior writer at CNET News covering Twitter, Net culture, and everything in between.

 

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