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Comment by jacquesm | Hacker News Reader

Microsoft is a software company. They've lost big $ on any hardware product they've ever shipped except for mice and keyboards, and without exception all of them were 'me too' products.

All this is is a very transparent attempt at undercutting their competition, if the zune was any indication of how well they'll stack up then Apple has (unfortunately) very little to worry about.

What is much more interesting here is if there really is a market for these devices as large as is being predicted.

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The Zune is not an indication of "how well they'll stack up," because by the time they released the Zune, Apple had already sold about 100 million iPods.

This time they're both starting from zero, so it'll be very interesting to see who gains more market fighting on equal ground. (Perhaps the first time we see them in this situation?)

FTA: "Hewlett-Packard has reportedly been working with Microsoft in preparation of the new slate-type computer, to be announced during the evening keynote at the Consumer Electronics Show in Las Vegas."

So, assuming that the article is accurate in this respect, I'm guessing that it won't be specifically Microsoft hardware.

Isn't the XBox a successful Microsoft hardware product? I think it actually turned a profit in '08ish.

It is still a net loss and will continue to be so for at least several years.

'Microsoft is a software company.'

They're less than that: they're a client/server software company. Their web applications, for all the Windows/Office revenue thrown at them, are still less mature than their competitors.

Agree. I like the Courier concept, but I'm skeptical about MS's ability to deliver on hardware. Although to be fair, their mice are great.

I also share the same sentiments towards Google and their recent hardware follies.

Xbox has done pretty well. There's too much blind Microsoft hate on this site.

Xbox is a net loss, and according to someone that works there (who is active on HN) they hope to be in the black 'somewhere in the next couple of years'.

So, no, Xbox has not done 'pretty well'.

They are now 5 quarters profitable, but overall they're still in a very deep hole.

They might be slowly crawling out of a big hole, but that doesn't mean they're not doing well. I'd argue that the cost so far should be considered more of an investment than a loss. They entered a difficult market dominated by two large players with a lot of brand/name loyalty (i.e. fanbois) and huge barriers to entry. Over the last 8 or so years, the Xbox brand has become number 1 or 2 (depending on which metric you use), beating out the last gen's leader (Sony). They've also become the leader in the online console space where profit margins are high and revenue is recurring (think WOW).

All this isn't to say that MS won't mess up the courier concept but that they're better than many people give them credit for.

The question I pose to you isn't - is the Xbox hardware profitable? It's - is the Xbox software profitable enough to make Microsoft a profit taken the hardware into consideration. If so doesn't that make the Xbox profitable? HP and other printer company do kind of the same thing. They sell the printer at a loss and make money selling the ink.

Except that "how well they'll stack up" with Apple isn't measured in profit; it's measured in sales or market share. While the Xbox might not yet be net profitable, it does have enough market share to claim that it stacks up with its competition. I'm not saying the Courier will be competitive, but I hardly think you can, a priori, write Microsoft off in this market.

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