Now while I might agree with much of this article, I have to disagree with the conclusion.
In it, the writer concludes that the money that MS has invested in the XBox program would have been better spent returning dividends to investors. I think that's a patently stupid idea. It makes sense in a mature business, where you control the marketplace and have a ton of cash lying about.
But Microsoft isn't operating in a mature space (at least not in the console market) and is by no means a dominant player in the space. You have to pay to play, which is exactly what they are doing.
Paying a dividend rather than investing in the Home and Entertainment market would have been tantamount to giving up on the gaming market (which is key to driving adoption of new OS variants in the home) and the home entertainment market - where MS hopes to grow to become a dominant player in the next few years.
Oh.. so.. let's just give up and go home? What kind of bizarre, incompetent business advice is this?
Oh.. wait.. it's Forbes.
Silly question.
Posted by artandscience at April 30, 2007 01:54 PM