
I've listened to a lot of talk and read a lot of articles concerning why companies offer products that they make no money on. Take Microsoft (MSFT) for instance. Everyone talks about why they create a product like the XBox and Xbox 360 and lose a lot of money on each one. The reason is called 'marketing.'
Microsoft has an image as becoming the old-man-on-the-block, the follower and nothing-new-will-come-out-of-you company. Enter the Xbox. Whether you like Microsoft or not, there are tons of Xbox fans out there. The Xbox is cool to a lot of people. But why does Microsoft offer it at huge losses for each unit sold? It's considered a marketing expense.
They don't care if they make money on it; they never have and probably never will. It's all in the image of themselves and creating of a product that people think as hip and new.
It's like their new push into creating software for robots.
One article says, "The Seattle-based company on Tuesday previewed a set of new software tools that aims to give developers a simpler way to design robots and to create and test programmes that operate a wide range of machines - from toys to floor sweepers to those used in factory production lines."
Microsoft Robotics Group general manager Tandy Trower says "We believe this is a key part of the future of computing." He went on to call robots the next evolution of the personal computer.
They are now offering their first product into the robotics market called Microsoft Robotics Studio, which has been designed for those who have always had to reinvent everything when they would use different hardware to build their robot.
Now why does Microsoft care about Robots at this stage of the game? Now they are saying that it will be a multibillion-dollar industry in the next 5 to 10 years, and they may be right. This should be a profitable product because it is software, rather than hardware oriented.
But I think it's more the 'cool' factor again than anything else. What cooler technology to get into than robots? Would you want to be known as the company developing 'Vista' or the Xbox and robotic software?
Take into account things that will give your company some zip, whether it makes money or not. It's the unique, innovative things that people love about companies and keep the company in the minds of people rather than the actual things that make money. You need both to make it in this 'noisy' world.







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