Bill Gates is what?
From CNN (and thanks to DQ reader Don Barree for the link):A coy Microsoft Chairman Bill Gates hinted Thursday that his company might license the software underlying its Xbox gaming machine to a variety of outside companies in a bid to expand the market share for the Xbox machine -- a platform that trails the sector's No. 1 Sony PlayStation.
The U.S. software company is considering offering "the basic software" for Xbox, although no decision has been made, Microsoft Japan spokesman Kazushi Okabe said Thursday, confirming the Gates' comments reported in Thursday's editions of Japan's top business daily Nihon Keizai Shimbun.
Okay, besides the fact that Bill Gates is now apparently a shy schoolgirl, one step short of coquettish, I think this could be a very, very interesting strategy.
I didn't think that when I first read the article--at first glance, it looks like dilution of market penetration in regards to how many homes would actually have Microsoft's hardware in their living room. Here's what I had forgotten: Microsoft loses money on the hardware. If they can license out the software, a device gets produced to play Xbox 360 games that actually makes money for Microsoft. Increase installed base and increase profit at the same time. Nice sleight-of-hand there.
This becomes particularly clever if that "basic software" can be installed on a PC. Developers would no longer have to port a game--it could be played in its "native" format directly on the PC. That benefits everyone: consumers who owned both the console and a PC could play the game on either setup, developers would be releasing to a far larger installed base with no porting efforts on their part, and the Xbox 360 would become an even more attractive development platform.
Even better: this might force Sony do something similar. That would be very, very sweet.
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