Microsoft Entertainment and Devices President Robbie Bach told eWEEK that he expects the Xbox division to be profitable by 2008. Microsoft has been selling Xbox since 2001, losing money every single year, but Bach says that they are now no longer selling the console at a loss, which means that by next year software licensing sales, first-party software, peripherals and Xbox Live should all insure that the Xbox division will turn a profit for the first time.
That’s all very exciting. Making money, as opposed to selling a loss leader, will give Microsoft a lot more flexibility, the kind Sony has enjoyed and squandered. That could mean price cuts on the console, free Xbox Live, free games with purchase of a console, or just increased investment in the platform to make it even better. Either way, since Microsoft is clearly succeeding in its mission, it seems like we can almost guarantee a new Xbox in a few years, and that’s the best news of all.