Published , by Donovan Erskine
Published , by Donovan Erskine
Apple and Epic Games are in the midst of what will surely be a lengthy legal battle. During the court hearings, we’ve seen the companies point to different examples around the industry that support their given cases. As a part of Epic Games’ testimony, the company brought in Xbox Vice President Lori Wright as a witness. While on the stand, Wright admitted that Microsoft does not make a profit from selling Xbox consoles.
It was during the third day of the Apple vs Epic Games trial when the latter brought in Xbox VP Lori Wright as a witness. With Epic Games trying to prove Apple’s wrongdoing in the way it handles its App Store, the company has looked to other publishers that have had to deal with the same policies. While on the stand, Wright was asked a series of questions. One such question was "Does Microsoft ever earn a profit on the sale of an Xbox console?" to which Wright responded “No.”
In a follow up question, the Xbox VP was asked why does Microsoft continue to sell Xbox consoles if they aren't making a profit on them. Wright answered, saying that the “hardware is critical” for supporting a user end-to-end experience.
It’s been highly speculated that Microsoft doesn’t make a profit from its console sales, given the price in comparison to the parts it takes to make an Xbox. This would also further underline why the company has such a focus on services like Xbox Game Pass to bring in its revenue.
As a byproduct of the ongoing court case between Apple and Epic Games, we’ve learned a lot about internal statistics and upcoming projects. This includes the fact that Psyonix is working on two new Rocket League mobile games, and that PlayStation accounts for nearly half of Fortnite’s revenue.