Microsoft (MSFT) Missing Kinect Opportunity?

Now that Kinect has become the fastest growing device in gaming history, the question is whether or not Microsoft (NASDAQ:MSFT) is taking advantage of the situation to generate its fullest revenue potential. It appears they're leaving a lot of money on the table.

Motley Fool noted, "When Microsoft presents a list of upcoming attractions for the platform, Mr. Softy's own game-publishing arm makes just a token appearance in the Avatar Kinect social-entertainment app. No, it's not really a game. For that, Microsoft leans on titles from French powerhouse Ubisoft, indie developer Twisted Pixel Games, and rivals including Take-Two Interactive (Nasdaq: TTWO) and THQ (Nasdaq: THQI). Moreover, Avatar is free to Xbox Live Gold pass holders, creating approximately zero dollars in additional sales. Whoop-de-doo.

"You can beat that with a stick If my company had developed a winning hardware platform, I'd make sure that the software wing of my house piled on, stat. Microsoft is missing a major opportunity here. In general, this lack of opportunistic killer instinct is what keeps Microsoft's gaming operations down to a mere hobby -- and an expensive one at that, with high manufacturing costs.

"If Microsoft wants to make real money on the Kinect, it had better sit its gaming-software division down for a serious talk. Hardware-plus-software synergies create the real smash hits in this business, and when was the last time you got more excited over Sony's hardware-based results than those of exclusive software shops such as Activision or Take-Two?

"It's not too late to whip this sorry state of affairs into shape, but the real opportunity may have passed with the high-profile Kinect launch and its first holiday season already in the rear-view mirror. Sorry, Ballmer -- you'll just have to settle for a record-breaking launch of expensive hardware followed by a modest uptick in the truly profitable software sales."

Microsoft closed Friday at $25.68, up $0.27, or 1.06 percent.




Source