Can Microsoft Corporation (MSFT) Still Win the Console Wars of 2013?

Microsoft Corporation (NASDAQ:MSFT)Microsoft Corporation (NASDAQ:MSFT) and Sony Corporation (ADR) (NYSE:SNE) are doing all they can to win the 2013 edition of the video game console wars. One analysts believes Mr. Softy may have done enough to overcome early missteps, calling the Xbox One a winner for the holidays.

The next-generation console painted itself into a corner early on as Microsoft outlined some downright draconian content policies. Sony’s PlayStation 4 is comparable in every way that matters, but it also comes without restrictive content licenses and costs $100 less than the $499 Xbox One. It looked like game over in the first round.

But Microsoft quickly apologized for its heavy hand over what gamers can and can’t do with their Xbox One games, and it ended up removing most of the unpopular restrictions. The console is still more expensive than the Sony Corporation (ADR) (NYSE:SNE)product, but maybe that’s not enough to hold the product back anymore.

Analyst firm Robert W. Baird says the Xbox is on a winning track. Analyst Colin Sebastian ran checks against the supply chains of both consoles and came away with a dramatic conclusion: “Microsoft Corporation (NASDAQ:MSFT) may have the benefit of a 2-3x unit advantage at launch compared to Sony’s PS4.”

That’s not a small victory, but a savage rout. If Sebastian’s sources are on the money, Microsoft will most definitely win this round of the console wars.

Well, Redmond will take the early battles, anyway. Both systems are expected to launch into heavy demand, with manufacturing capacity becoming the limiting factor at first. In other words, Sony Corporation (ADR) (NYSE:SNE) might still rule the roost when it comes to public opinion and the potential for long-term success. But Microsoft Corporation (NASDAQ:MSFT) shows mastery of the supply chain game at this point — secure more components, build more units, and look good in the early sales statistics.

The real takeaway from this unexpected win is this: Microsoft is serious about hardware.

We all know Microsoft Corporation (NASDAQ:MSFT) as a software giant, built on decades of success via Windows and the Office suite. That’s how Bill Gates got his Dow Jones Industrial Average (INDEXDJX:.DJI) membership card, and these are still the core operations of a market giant with a $266 billion market cap and $78 billion in 2012 sales. But that’s changing fast.

The recent and ongoing reorganization into a “devices and services” company is for real. Redmond is beating hardware specialist Sony at its own manufacturing game. The feat is even more impressive when you consider that most of a modern game console’s parts are made somewhere in Southeast Asia. Sony Corporation (ADR) (NYSE:SNE) has these sources right in its extended backyard, and Microsoft is still slapping its hand away with authority.

There’s still a lot more to say and do before the cows come home, but Microsoft Corporation (NASDAQ:MSFT) may be onto something good with the new hardware focus. The lessons learned in building consoles might even translate into smartphone and tablet success somewhere down the road. Maybe that’s how Microsoft Corporation (NASDAQ:MSFT) will earn its keep as a Dow member over the next decade.

The article Can Microsoft Still Win the Console Wars of 2013? originally appeared on Fool.com and is written by Anders Bylund.

Fool contributor Anders Bylund holds no position in any company mentioned. Check out or follow him on Twitter and Google+.The Motley Fool owns shares of Microsoft Corporation (NASDAQ:MSFT).

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.

blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The 10 Countries with the Highest Suicide Rates

The 10 Most Technologically Advanced Countries in the World

The 10 Safest Countries in the World to Live in Peace

The 10 Top Selling Smartphones in the World 2014

The 12 Biggest Shopping Centers in the World

The 10 Friendliest Countries in the World

Qihoo 360 Technology Co Ltd (QIHU), Actavis plc (ACT), Yahoo! Inc. (YHOO) Among 20 Long Ideas from Sohn Canada

The 10 Laziest Countries in the World

The 10 Most Polluted Countries in the World

The 10 Most Dangerous Cities in America 2014

The Top 10 Gold Producing Countries in the World

The 10 Tallest Buildings in the World

The 10 Richest Stand Up Comedians in the World

The 10 Fattest Countries in the World

The 5 Best Summer Jobs for Teens

The 10 Most Religious Countries in the World Keeping the Faith

The 10 Most Educated Countries in the World

The 10 Most Popular Cell Phones in the World

The 10 Drunkest Countries in the World

The 10 Most Expensive Private Schools in the World

The 10 Smallest Countries in the World

Walking Dead Season 5 Spoilers You’ll Wish You Didn’t Know

The 10 Poorest Countries in the World

The 10 Greenest Countries in the World

The Top 10 Countries with the Highest Population in the World

The 10 Most Visited Countries in the World

The Top 10 Star Wars Characters in the Iconic Series

The 10 Most Expensive Android Phones in the World

5 Reasons Why The Illuminati Is Real and a Threat to Society

The 6 Scariest Halloween Costumes Ever Screamed At

The 4 Biggest Hedge Fund Managers in the World Today

The 15 Most Densely Populated Countries in the World

The 10 Biggest Tea Drinking Countries in the World

Top 6 Ways to Improve Your Checkout Process and Close Sales

The 5 Most Profitable Online Businesses You Can Start Today

The 20 Most Profitable Hospitals in the US

The 5 Most Profitable Home Businesses to Start

The 7 Teams that Will Win the Stanley Cup in 2015

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!