Yeah, they've been explaining away inflation for decades by averaging housing with electronics. Yes your rent has tripled, but your TV is also 3 times as big and your gamebox has 1000 times the CPU so really, things have only gotten 2% more expensive, says the CPI calculation.
Now the politicians don't even have that excuse. I suppose they'll have to add AI tokens to CPI. Used to cost $1000 each, now $0.000002 each, average inflation is 2%.
Except they don't even have that because the recent FOMC meeting pretty much admitted inflation is 4% and they don't feel like doing anything to reduce it, but they're definitely committed to reducing it, they swear.
There is a limit on production efficiency, life is full of logistic curves which feel exponential at first until the inflection and leveling off phases.
It's going to hurt when agriculture does not see the efficiency gains it has been receiving for the last century or so. We might be at the inflection or leveling off now.
They lose money on every dollar they invest overall in xbox as a business. They pretty publicly documented this (which is unusual for Microsoft).
Overall gaming is a dying business. Everyone has a pretty powerful smartphone in their pockets, and there are so many platform vying for attention. AAA gaming is becoming a smaller fraction of the overall gaming pie, so I would expect prices to go up. Mobile gaming usage is up from 42% -> 55% from 2017. Even based on analysis from Steam's data, Indie games are 48% of sales, vs 24% in 2018.
Good. AAA should die, and the earth where it had grown should be salted.
Gaming is fine. Remove AAA from the equation, and current gaming is perfectly fine. Indies are plentiful and offer a great experience. Even lower-budget games from larger companies are fine without being plagued with every horrible practice (e.g.: microtransactions).
Also, the past 4 decades of games are still available. Hell, I would probably need two lifetimes to play all games in my queue list.
It may not be the infinitely profitable industry that attracts the likes of Microsoft, and that is a good thing. In fact, I view Microsoft failing in gaming as a hopeful sign for the health of videogames.
What? Both PC and mobile markets are growing by any reasonable metric, and consoles are propelled by stellar Switch 2 sales.
The gaming market is ripe with money, it is total failure on Microsoft side that they failed to capture any of that. Xbox is on life support, and Windows platform tax is captured by Steam, where Valve funnels it into Linux to make its own platform.
Sounds like an opportunity then for you to create a competing company that functions the way you feel it should function. If that's what people value, you'll take all the business since you're the only one offering it.
> Sounds like an opportunity then for you to create a competing company that functions the way you feel it should function
Sure, if one has millions and millions in capital. Because why would an investor put a money in my company that works the way it “should” according to me if it produces lower profits as compared to my competitors?
Because buyers choose to spend less money, so if a business comes around that can offer the same product/service at a lower price, the investor will want to own a piece of that business rather than the one that is about to lose buyers.
Right, because we never see investors making decisions that are suboptimal in the long term because they're too focused on short-term gains. Everyone is perfectly rational, and high initial costs have never discouraged anyone from trying to displace an established dominant player; it's purely because the dominant players are perfectly efficient and don't ever try to rent-seek.
I did not claim any of that, so not sure if your reply is misplaced.
It’s an easily observable fact that throughout the previous decades, investors have invested in businesses that reduce profit margins. Amazon being one of the most famous with the slogan “your margin is my opportunity”, but also Walmart, Costco, and other businesses that end up winning because they delivered acceptable products or services at lower prices.
Now the politicians don't even have that excuse. I suppose they'll have to add AI tokens to CPI. Used to cost $1000 each, now $0.000002 each, average inflation is 2%.
Except they don't even have that because the recent FOMC meeting pretty much admitted inflation is 4% and they don't feel like doing anything to reduce it, but they're definitely committed to reducing it, they swear.