Microsoft’s Big Bet on Online Gaming
The Wall Street Journal Online analyzes the prospects of the Xbox’s online-gaming component. Analysts say Microsoft has spent hundreds of millions on Xbox Live, with little guarantees of returns. ‘It is not clear that companies like Microsoft and Sony will be able to lure large numbers of players — each has attracted a small fraction of users to online play with their previous consoles,’ WSJ Online writes. ‘The companies also must be careful about new business models for distributing games — such as games-on-demand — so as not to alienate game publishers, who still rely heavily on in-store sales. And games designed for multiple players have a mixed record of attracting customers.’ Says analyst Michael Pachter, ‘At the end of the day, we don’t play games for social interaction … We play games to escape.’ Microsoft’s strategy is ‘absolutely flawed,’ he added.