Posted on 07/01/2002 4:15:08 PM PDT by Bush2000
Microsoft’s Freon project is an Xbox, with extras
July 1 — Its code name is “Freon,” reflecting the notion that it is the coolest secret project at Microsoft Corp. these days, at least in the eyes of the Xbox video-game division.
FREON STANDS FOR is a souped-up successor to the Xbox console — capable of playing games but also offering television capabilities, such as pausing live TV and recording shows onto a computer hard drive, say people familiar with the effort. Though it is unclear whether such a product will ever be built, its core concept appears to have the backing of Microsoft Chairman Bill Gates, who wrote in an internal memorandum in January that he was a “big fan” of a machine that would combine video services with gaming.
Such a device, which could cost around $500, would have another big advantage: It could beat video-game market leader Sony Corp. to the punch.
Microsoft officials are mulling releasing some kind of new game machine sometime next year or in 2004, say people familiar with the matter. That timing could shake up the $20 billion global video-game market, breaking a long-established pattern of developing and releasing new systems in roughly five-year cycles. Sony, the undisputed leader in a three-way race with Microsoft and Nintendo Co., isn’t expected to release its next PlayStation system until 2005.
“The utmost goal is to ship something before Sony,” says a person familiar with Microsoft’s plans. Changing development cycles could be particularly threatening to Sony, which relies more than Microsoft on specialized computer chips that take years to design. “My biggest concern is if Microsoft or Nintendo try to change the rules of the market,” says Shinichi Okamoto, chief technology officer at Sony’s game unit, Sony Computer Entertainment Inc. “I can imagine several [ways]. The first one is very simple — launching an annual new model: Xbox 2002, Xbox 2003.”
Microsoft officials won’t comment on Freon. But the software titan has been playing catch-up to Sony since it introduced the Xbox last year. Though Microsoft hoped the introduction of a hard disk and other features would inspire developers to write more exciting games than for the PlayStation 2, Sony’s hardware has retained an edge among consumers and programmers.
“It’s amazing how far we have come, and yet we still have to get people to see Xbox as even more of a breakthrough than they do today,” wrote Mr. Gates in the internal e-mail sent to top Xbox executives in January.
Officially, Microsoft says the current Xbox has been an early success. The company’s focus right now is on selling more Xbox consoles this coming Christmas season, says John O’Rourke, director of Xbox sales and marketing. At the same time, “we have to be thinking about the future,” Mr. O’Rourke says.
Microsoft officials are also mum about the release date for the Xbox console’s next version, known as “Xbox Next,” expected about 2005 or 2006. Still, the various Xbox projects inside Microsoft — as well as Mr. Gates’s musings in his memo — show Microsoft is serious about overhauling Xbox, if necessary, to strengthen its challenge to Sony.
A key pressure is economics: The Xbox console isn’t profitable for the Redmond, Wash., company and its costs are believed to be higher than Sony’s, partly because of the hard drive and a version of its powerful Windows operating system included with each machine. While “the Xbox is a full-feature BMW, the PS2 is a Toyota,” says Bruno Bonnell, chairman and chief executive of French game maker Infogrames Entertainment SA.
But many gamers prefer the more practical Toyota. Sony has shipped about 32 million PlayStation 2 machines world-wide, while Microsoft was expected to have shipped only 3.5 million to four million Xboxes by Sunday, the end of its fiscal year. Microsoft, which lowered sales expectations earlier this year, insists its more-powerful machine eventually will win over customers.
Mr. O’Rourke says the machine’s hard drive helps deliver features like the voice commentary on Microsoft’s “NFL Fever” football game. Microsoft also recently showcased a new Xbox game called “Blinx: The Time Sweeper,” which allows players to record moves they have made in the game and replay them at different speeds in the future.
“That is something you can only do with a hard disk,” Mr. O’Rourke says.
Still, Mr. Gates doesn’t seem convinced. In his memo, sent after one of his periodic “think weeks” away from the office, he mused about whether a hard drive would be necessary for Xbox’s online-gaming service, expected to be launched later this year. “Do we really know that you have to have a disk to do online?” Mr. Gates wrote. “I think it’s probably right, but say Sony tries to do online without it — how bad will it really be?”
Mr. Gates also tossed out a thought he described as “heretical,” wondering whether Microsoft will have to “back down” from its plan to offer online gaming only over high-speed Internet connections. That plan has been criticized because so few U.S. computer users have high-speed connections.
Mr. Gates received a briefing about the Freon product last week, a person familiar with the matter said, and also presided over a pep rally of sorts for a larger Xbox group. When asked about Freon at the meeting, Xbox chief Robbie Bach said there were no definite plans for deployment, this person said.
Mr. Gates has long been fascinated with extending Microsoft’s Windows software into the living room, though Microsoft stumbled with most of its previous TV efforts. And many in the video-game industry wonder if consumers would pay $500 — compared with the $199 Xbox — for a complicated home-entertainment machine.
“I worry about what I call feature creep — layering too many things into a product so the original intent of the product gets lost,” says Schelley Olhava, an analyst with International Data Corp.
That's what I'm wondering, too. Roll a game machine, DVD, and TIVO into a single unit. I'm not sure I'd bet the farm on this one...
I expect a Microsoft "PC" to come of this as well eventually. It will be a "PC" like we've never seen before. Portable, rugged and likely, wireless.
"Unclear" my butt. The entire Ultimate TV team (Microsoft's short-lived TiVo competitor) was recently folded into the XBox group. There is no question whatsoever that XBox2 will incorporate PVR features, which is a no-brainer. Other than the hard drive, there's virtually no difference between the electronics required for a game console and a PVR—since XBox already has a hard drive, adding PVR software suddenly turns that undervalued feature into a killer app.
"Such a device, which could cost around $500..."
Such a device would cost around $300, not $500. The expected royalty stream from game disks would allow Microsoft to sell its PVR for below cost just as TiVo's monthly fee subsidizes their price. You can buy a TiVo for $299, so you'll certainly be able to buy XBox2 for that.
"“Do we really know that you have to have a disk to do online?” Mr. Gates wrote. “I think it’s probably right, but say Sony tries to do online without it — how bad will it really be?”"
Yes, Bill, you have to have a hard drive for online, and Sony knows it better than you do. What would be the core profit center for a Sony online service? A PS2 port of EverQuest. I guarantee you, any Sony exec who suggests to Verant that they create a version of EQ that can never be patched would get savagely beaten.
"Mr. Gates also tossed out a thought he described as “heretical,” wondering whether Microsoft will have to “back down” from its plan to offer online gaming only over high-speed Internet connections."
Yes, Bill, you have to support modems. The Axis of Stupid (comprising the RBOCs, the cable monopolists and the FCC) have so totally botched broadband that we're stuck with modems for at least five more years. Note that the TiVo business model relies on its modem; either XBox2 will copy that business model for its PVR software, or Microsoft will simply buy TiVo out of the petty cash fund and fold the two together.
Perhaps. But you're forgetting about one thing: the recession and still-increasing unemployment. Motorola is laying off 10,000 more. Most of the 80,000 WorldCom employees can kiss their jobs goodbye. Even IBM is chipping away at workers - 5,000 here, 2,000 there.
Even if Microsoft is 'practically' giving the Xbox away, I think we're going to see this Christmas season the worst ever for retailers. Heck, I have a job and I still consider the Xbox an unneeded and extravagent luxury. I am focusing on the basics: food, house, and basic utilities. Everything else is going into a rainyday savings account.
And you can bet there are millions of people out there in worse straits then me. I would say none of the console makers are going to make much money this year.
It's a game console. No, it's a PVR.
Game console! Pee-Vee-Are!!
So where would you put it? Living room or basement? Yeah, I don't know about this...
There is the report that that Apple boxes are piling up in the warehouse. New tech doesn't seem so necessary when you're making monthly payments on this and that and wondering if the income will continue. Some are even going so far as to try to pay off their Visa/MC. New stuff isn't so important these days.
In any case, the PS2 is not going to be $199 two years from now, and neither will a standalone Xbox if there is one, and the Cube will probably be even lower than that. So the question is, in two years, do you pay ~$79 for the single-purpose Gamecube, ~$119 for a dual-purpose PS2/XBox that does DVD also, or ~$300 for this Swiss-Army knife thing?
The objective would be to own 30% of the basements and 80% of the living rooms. This makes tremendous financial sense, inasmuch as there are more living rooms than basements out there.
The plan would be to have enough current gamers buy it as a game console that it holds second place to Sony and maintains a large pool of developers. Then attack the vastly larger audience of people who don't play console games. A PVR-enhanced XBox2 will probably sell for a premium over Playstation3, but it will sell for the same price (or even less) than any other PVR. Therefore, Microsoft can hold a third of the console game market while dominating the PVR market—after all, given a choice between a PVR that just does that, versus one with superior visuals that also plays games and costs the same or less, most people are going to opt for the latter.
Putting a game console onto the TVs of people who don't currently play console games is the real motherlode. "Casual gamers"—people who will play games given the opportunity, but who don't trick out their PCs for game-playing—completely dominate the PC game market. These people will never buy consoles, but if you sneak a console onto their TV they will buy games. But only Microsoft can pull this trick off, because the developers who currently understand the casual gamer market all work on the PC. Those developers aren't going to become Sony licensees on spec, but the learning curve from PC to XBox (particularly for less graphically demanding games) is very affordable.
The previous generation machines can be ignored, as they sell to a completely different (poorer) market. Playstations cost $50 now, but that doesn't cut into sales of GC/PS2/XBOX—or rather they do, but in a way that's entirely consistent and already factored in. (Basically, those late-cycle sales the Playstation enjoys at $50 are Sony's payoff for the market-share it seized early on by selling the first Playstations well below cost.) The relevant choice will be to buy XBox2 at $300, or wait a year to buy PS3 for $250—just as the choice in 2000 was to buy PS2 for $300 or wait a year to buy XBox for $250.
These computers are already available, and are absolutely incredible. They are used by the industry leading producers and stage production companies in the music industry. A good number of professional electronic musicians use this system also. It's called Microwave, the press release with specs is here, On MusicGearReview
And if Apple played their cards right and became the standard in computing, you would no doubt be using the same words about Apple. In fact, Apple would have been more ruthless than Microsoft as they wanted to "close" their system. There would have been no Dells, no Gateways, no Compaqs, etc., had Apple won the computer wars.
The reason so many people hate Microsoft is because they are so successful. But had Microsoft been "nice guys", nobody would hate them because nobody would have ever heard of them. It's a dog-eat-dog world out there. In order for there to be winners, there has to be losers. There are 30 professional teams in Major League Baseball. Guess what? 29 of those teams are going to go home unhappy when the season is over.
Why do you think the New York Yankees are the most hated team in baseball? Because they seem to win the World Series year after year. Do you think the Yankees give a crap that teams like the Tampa Bay Devil Rays are 30 games out of first place? Are they supposed to feel sorry for them and not go so hard on them? Hell no. When the Yankees play Tampa Bay, they crush them 15-3 and go home with a smile on their faces. That's not only what makes them winners, but that's what keeps them winners.
The "XBox 2 in 2005" talk is probably just a smokescreen to lull Sony into complacency; there's no reason in the world why MS can't or shouldn't ship XBox 2 in 2004.
The five-year hardware cycle on consoles is much, much more drawn-out than it needs to be—Moore's Law applies to consoles every bit as much as to PCs, so there's plenty of room for improvement in the chipset after just a few years. Really, the hardware cycle should be driven by the software cycle: Consoles don't demonstrate their potential until the developers who created the first-generation titles finish the second generation, so it's important to leave enough time for that to happen. With 18-month cycles, that means that XBox 2 ought to launch 36 months after XBox 1, but that's more than enough time to dramatically improve the graphics hardware. The only reason to take longer than that is to milk the previous generation for more royalties, but now that DVD lets each generation be backwards compatible, that's no longer an issue. And even if shortening the dev cycle hurts sales overall, it hurts Sony worse than Microsoft, which means it helps Microsoft gain market share.
You got that right. I'm hooked to the X-box. Halo, the space marine game is the best electronic thing that I ever played in my life! Microsoft plays big, and wins big. Remember the browser war? I don't have a problem with that, competition is what made America great!
I absolutely agree, but I prefer their machine, hate their politics.
I can't wait to play it online, X-box live is coming out soon!
The reason that I bought X-box is because of the rave reviews that I heard about Halo. So I knew I had to buy the X-box.
No regrets, and I loved it ever since. I can't live my life without the X-box (and FR that is).
Only Microsoft can tolerate losing money (rumored to be $150) on every box sold. I'm told that MS needs some more titles out, because they do make money on the games.
MS also might want to get a hardware update out there too.
It's coming back. I saw a commercial today for a set-top box and wireless keyboard bundled with MSN.
Basically, X-box is already equipped with the hard drive and Ethernet port built in. Some information from the site that I posted above, The Xbox Live Communicator headset allows you to use your voice like never before. The headset allows for games to do really amazing things, like changing the sound of your voice. It's going to be amazing, we will be able to play with X-box players from all over the world. This is going to be really big, nothing that PS2 is capable of doing.
Hopefully X-box live will be out and running in the fall for all of us X-box users to play on! If you still have dial-up, please get rid of it! This is the most information that I can give you now. I'll post some more later as I learn more about this.
I agree with you. Don't forget you can customize your mulitplayer games in Halo to include ghosts, tanks, jeeps, or whatever you want. There's a lot of flexibility that I just adore.
Actually, every console from every manufacturer sells for below cost in its first year or two of life. This is not a game for the poorly-capitalized to play; Microsoft, Nintendo and Sony all sit on monstrously large piles of cash that they will burn through to secure market share. (A lack of that cash is what killed Atari, Sega, Neo-Geo and 3DO, among many others.) It is vitally important to seize market share right off the bat, in order to secure developers, in order to have titles, in order to sell boxes down the road. But, perversely, the first silicon off a fabrication line costs more—orders of magnitude more—than later generations. So you sell the console at a $100 loss the first year, but then you start selling it at cost the second and subsequent years even though you drop the price by $50 to $100.
Compare to consumer electronics—for example, DVD players. The first players off the line cost $800; a year later, they cost $400; and a year after that, they reached commodity pricing at $200. DVD player manufacturers basically made a small profit at each step of that cycle. The reason why they could afford to charge $800 on day 1, though, is because that didn't hurt sales down the road—if someone bought a Panasonic DVD player for $650, and then bought a bunch of movies for it, nothing would stop him from buying a Sony for $250 a couple years later and watching all his movies on that.
But in consoles, if the first box costs $500, everyone will buy its $200 competitor, and buy software compatible only with it, at which point that $500 console is permanently doomed. This is what happened to the 3DO, by the way—because the 3DO was built by third-party consumer electronics companies, who didn't have any long-term incentive to eat a loss on the first generation, it came out at far too high a price-point, which killed it.
"I'm told that MS needs some more titles out, because they do make money on the games."
Every console manufacturer makes a royalty on every title shipped, which is why they a) can afford to and b) have an incentive to sell the consoles below cost. But you don't get titles without developers, and you don't get developers without unit sales. XBox is now established well enough that it will hold its own against Sony. Companies spend less money on development, and make more money per unit sold, on XBox than on PS2, so while the one-year head-start on installed base that Sony enjoys ensures PS2 will remain the market leader, XBox is here to stay.
This is just sour grapes. You would be attacking any company that happens to be top dog in the computer world. Microsoft has put out some fantastic products over the years. They deserve all the success they have had.
Hey, it's not exactly a a sniper pistol; it's a recoil-operated handgun with a scope capable of 2x magnification, and it can fire 12.7 mm in either semi-automatic or automatic fire! Clip size is 12; ammo count is 120. It's great for long distance targets and gives you more rounds, typically, than the sniper does. It's great for targeting the inattentive Hunter in the orange part of his back. In The Silent Cartographer, this is especially effective when the Hunters are outside some structure and you can catch them unaware. There's a pistol and ammo lying around on the hill where you arrive. You can also take down a Banshee with the pistol, believe it or not.
The tailgunner is great in cooperative mode because of the unlimited ammo, but if you are playing by yourself, you sometimes risk attack while you are jumping into the back of the warthog. Using the sniper just before you do this can help to ward off Covenant forces in the distance who are waiting for just that kind of opportunity.
I'm into it. I still get stuck in Legendary mode, but given the fact that I'm 44 years old, that's not such a bad record.
It's unbelievable. My son introduced me to HALO. He was at E3 this year and confirms what you say about the advances in technology for the game. The only problem is that Bob and I don't have a lot of friends to link XBox with; we are 44 and 54, respectively. So the customizations in multiplayer don't do us much good--multiplayer doesn't do much, actually, until we decide to link our boxes with the twenty-somethings and get really crazy! I'm sure it will happen eventually. We still enjoy cooperative mode...and I have to admit, I am female and better than Bob at HALO--primarily in my choices of weapons. But the game is so advanced that weapons choice can surprise you, and you still learn by playing the game--no matter what strategy guides may tell you. That is certainly more than AI; that is intelligence on the creative people who built the game.
Yeah, the plasma overcharge (ever noticed the weird colors on the plasma pistol itself when you're doing that?) will stun an elite. But you'd have to be pretty fast to use a standard sidearm...I will try it. Thanks. Plasma grenades are a choice weapon for elites, unless the elites are invisible and harder to hit. But you can use the automatic rifle for them and they are not invisible for long. They then mysteriously reappear! The best use of the plasma pistol overcharge, as far as I've seen, is for the jackals, especially (and typically for HALO), the gold guys. An overcharge will take out their shields, and then another couple of shots will render them useless...but without their shields, they are shadowy and rather hard to hit sometimes. And they keep firing. Also, the plasma pistol keeps running out of energy as other plasma weapons do. Luckily there are many of them around to pick up. In the end of the Silent Cartographer, when you are trying like hell to surface again, the plasma pistol is at a premium! There are so many jackals that you cannot get enough of them, at least until you reach the invisibility whatever-the-hell it is that allows you to run past them.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.