[7thpower]

The awareness of a poor return on investment is a good thing for society. We want to do more with fewer resources.

Making terrible decisions, such as investing in distractions for your company and consumers, and then letting your workforce pay the tab.. is the thing that is not great for society.

[slg]

>We want to do more with fewer resources.

Who is the "we" here? Because the profit margin not being high enough is certainly not a problem for consumers. The only people who should care about that are the company's shareholders and "shareholders" certainly isn't synonymous with "society".

[LtdJorge]

Of course it is a problem for consumers if it bankrupts the company. Healthy company is better than no company. And I mean healthy, not greedy.

[slg]

It's pretty difficult to go bankrupt turning a profit.

[refurb]

Making a thin 3% profit that can go negative when the wind blows

[tommit]

Making crazy changes like squeezing out every last dollar out of your existing, loyal customers (looking at any PE firm ever) certainly affects the wind I'd wager.

[refurb]

Absolutely, and plenty of companies have made that mistake.

But the point is locking up money in a 3% margin business doesn’t impress investors.

So you either need to improve the margin with lower costs or higher price (or both). Or bail from the market entirely and put your money in something that makes more money.

[Krasnol]

Making less doesn't equal to going bankrupt.

[LtdJorge]

Yes, but making just 3% could mean tomorrow you’re in the red.

[hollerith]

Our society has a finite capacity to do projects and to run industrial processes. We want that finite capacity to provide as much quality of life as possible (and as much expansion of our capacity to do projects and run processes as possible), and achieving that is a thorny intellectual problem, which for many centuries in our society has been solved mostly by lawyers and judges knowledgeable about corporate law, stock markets, corporate managers, accountants and investors. This entire ecosystem is predicated on the assumption that investor will try to maximize their return of investment, which is strongly correlated with profit margin.

[dd8601fn]

It absolutely became a problem for consumers.

[slg]

Is a low profit margin a problem for consumers or is it the company's "money grubbery" of not being satisfied with that profit margin that is causing the problem?

[Gareth321]

When XBOX fires a bunch of people and shutters studios leading to fewer games with worse support, that's a problem for consumers.

I think people often forget that in a society we rely on companies making and serving things. They make our food and our medicine and build our homes and make our games. It's a good thing when their finances are healthy. It's a bad thing when they form monopolies and rent-seek.

[Krasnol]

How is making more and more every fiscal year "healthy"?

This is madness and it doesn't make any sense besides the one case where you pursue a monopoly.

All of this has nothing to do with the consumer of the product besides the fact that he'll get a worse and worse product while simultaneously being forced to pay more and more. Enshitification is aresult of this "healthy" business culture.

[Gareth321]

> How is making more and more every fiscal year "healthy"?

Because if they didn't make a return on their investment, they would invest their money elsewhere. When you have money you want a return. You can invest it into games, or cars, or phones, or mining, or healthcare. Whatever you invest it in, you want to be justified for your risk because you can lose money. Sometimes you can lose all of it. If you're really risk averse you just put it all into a bank account on low interest. A lot of European investors do this, which is why their technological innovations are falling well behind the US.

If you want more games with better support, we all benefit if they're making a profit on their investments.

[average_r_user]

I agree. The numbers need to go up every year without thinking about the health of the economy, and the Average Joe is delusional.

[slg]

Once again, what is the actual problem here? The company was making a profit at their current employment level. They are laying people off and shuttering studios because that profit isn't enough for them. This entire argument keeps coming back to "money grubbery".

[iosjunkie]

Would you accept 3% return on your money, especially if the investment was risky?

[Gareth321]

> Once again, what is the actual problem here?

I told you very plainly: fewer games with worse support.

[dannyw]

I think a lot of people in the gaming community would agree that Microsoft has ruined, or hindered (instead of helping) many studios they bought.

[pfdietz]

The mistake isn't shutting stuff down, it was overpaying for the stuff in the first place. This most recent action is unwinding the earlier mistake.

[signatoremo]

One of those terrible decisions was probably hiring too many developers, how do you suggest they fix that issue, besides changing leadership?

Many of those developers may not have the job elsewhere, or job paying much less. They now have the experience working in a proper software engineering environment.