They are losing so much because of the on-going repairs and warranties that they have to honor on the Xbox 360. What does this mean for the end-consumer? Absolutely nothing. Microsoft has poured in too much time and money to just throw their hands up and give up on the Xbox 360
It's really funny that the fanboys are ripping into Microsoft for operating at a loss in their games division because of repairs, the same people who were accusing Microsoft of intentionally bricking Xbox 360s, or intentionally making them unreliable, in order to milk more sales and, thus, profit. So they intentionally did it in order to operate at a loss? I know, nobody REALLY believed that they were doing it on purpose.
Obviously, these hardware failures of the Xbox 360 are hurting the game division. In the short-term, Microsoft will be hurting. However, they may be able to turn the corner and finally distance themselves from all this starting in the autumn with the release of the falcon chipset and with Mass Effect and Halo 3 on shelves.
2008 will be a clean slate for those guys.
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