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Microsoft Hardware

December 30th, 2004 · No Comments

Bob Cringely speculates about the future:

Take a long look at xBox development, the evolving PC and consumer electronics markets, and Microsoft’s own need for revenue growth, and figure what that means for the xBox 3, which should appear around the end of this decade. My analysis suggests that xBox 3 will be a game system that’s also a media receiver and recorder and a desktop workstation. Not that you’d use one box for all three things, but that you’d buy three essentially identical boxes and use them for all three functions. And of course you’d buy extra units for kids and spare TVs, etc. In short, xBox 3 will be Microsoft’s effort to extend its dominance of the PC software industry into dominance of the PC hardware, game, and electronic entertainment industries. At that point, even mighty Dell goes down.

With its continual need for more revenue, Microsoft will by then have already finished its destruction of the world software market, will have sucked all the profit out of the world hardware market, and will discard its hardware OEMs like HP and Dell and compete with them head-to-head. And they’ll be doing the same for DVDs, TVs — even mobile phones. Of course, part of the plan is for all the content coming to those devices to throw off little revenue streams to Microsoft, too. And the software that holds it all together will be rented, rather than owned or even traditionally licensed. This would give Microsoft both the deterministic revenue stream it covets and the leverage of being able to threaten to turn off the tap and thereby maintain control over, well, all of us. It will be an effective five to 10 percent tax on global income that suddenly appears one day, and academics will call it a natural monopoly.

Tags: Microsoft

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