One overlooked reason for MSFT winning the battle for exclusives - $$$$.
MSFT has over $20 billion in free cash. Sony about $2 billion. MSFT makes roughly $14 billion/yr, Sony $2 billion. Why does this matter? MSFT has the luxury of thinking long term, Sony not as much (hence Sony's decision to dissolve their unprofitable hardware division).
MSFT has no need to make $$ now with the 360. Their goal is long term dominance of the living room. They will overpay for games, developers, exclusives, hardware failures (extended warranty) where Sony simply can and will not. MSFT wants their piece of your entertainment life and they are going to get it no matter what the cost. It is part of their long term strategy!
Seriously, what would you do if you had $20 bill in cash laying around? They are still supposedly a growth company so they aren't going to pay out dividends to stockholders. They have identified game systems as a driver of brand recognition andbrand loyalty (see system wars), and a source of future not even identified revenues.
Wise or not, they will continue to pour money into the 360 even if the losses continue. It doesn't seem as though Sony has that luxury.
Thoughts?
links: http://finance.yahoo.com/q/ks?s=MSFThttp://finance.yahoo.com/q/ks?s=SNE
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