I'm not sure that's the example I'd use. They sunk billions in the first on for little to show for it. Billions fixing broken xboxes in the second one and only recently have begun to gather some steam -- and even then it was helped by Sony's numerous missteps.
"Only recently?" If not for the $1B RROD write-down in 2008, Microsoft would have been profitable then. MS has been making money off Xbox ever since that writedown.
Got a cite for that? I think I saw estimates that the XBox project was still 5-10 Billion in the red at that point. Have they been making profits to even cover the interest they could have earned with that size of investment by leaving it in something low risk?
No cite for my specific claim, but I found this Engadget article claiming MS's Entertainment & Devices Division (read: Xbox) was $80 million in the black in 2008:
Are we looking at cumulative Xbox profits from day one? Generally one is interested in a division's ability to generate positive cash flow, no matter the initial cost, because it's assumed that division will generate said cash flow in perpetuity.
