"1) That's fine, but it really has no impact on new console games. Consoles have used proprietary APIs and OSes for 2 decades and grew fine. Microsoft using its own OS in its own console really isn't worthy of much mention or consideration"
Oh yes it does.
FACT: You need an OS top run your vid game console.
FACT: If Microsoft didn't have Windows, they'd have had to develop an OS for their console from scratch, same as Sony and Nintendo did at far greater cost to Microsoft.(Linux is out, Microsoft wouldn't use it for obvious reasons).
FACT: Having a ready made, very good Windows 2000 OS to use cut down drastically on the cost and time to market of the XBOX console.Microsoft developed their console much faster than Sony did with their Playstation.
Its IS very relevant.
" Good move by Microsoft--but PS3 is using OpenGL, nullifying that advantage"
My reply to that is the same as above.
It still saved Microsoft a great deal of costs and time to market of the BOX.
I don't care if Sony "nullified" any advantage or not.
It was Sony that was already in the market.Microsoft was the challenger.
It was up to Microsoft to nullify any advantages Sony had.
Using Direct was one of the ways they did just that.
"The console market is completely different. Microsoft doesn't make the hardware, and has to deal with outside contractors for that. More parties leads to less overall profits. Sony has an advantage because it's a gigantic consumer electronics company--they spent $2 billion on the R&D for the PS2 alone. Microsoft is a software company"
I don't even know where to start on this one.
Not a single one of your points makes much sense.
To start off with, If anything the fact that its hardware makes my point even more valid.
Lets take Windows NT for example.
Microsoft started writing NT in 1987 when they brought in David Cutler and his gang from Digital.
It wasn't till 1996 when NT 4 came out that Microsoft actually started making any real profits on NT. That is NINE solid years!
Today, without NT, Microsoft will be in very deep trouble indeed.
During all that nine years, the cost of developing NT kept going thru the roof every year as they took on more programmers and as they paid the original programmers even more money.Some of those guys writing NT were making $500,000 per year at the time, plus stock options.
If you take the XBOX which is being made in China at very low cost, if anything the cost of making the console keeps going down every year..
Comparing NT or the original Windows to the XBOX, Microsoft has been able to turn it round much faster than most of their big software projects, in part because their cost of production for the hardware keeps going down every year, whereas costs for their software projects had always gone up.
The fact that the XBOX is hardware helps buttress my point rather than distract from it.
As for your talk about Sony being "a gigantic company" spending $2 Billion on R & D alone as you put it, it just made me laugh.
Microsoft is spending to the tune of around $6.8 Billion on R & D per year right now. Makes Sony's $2 Billion look like tiddlywinks doesn't it? :)
http://news.com.com/Microsoft+plans+to+boost+RD,+jobs/2100-1016_3-5053516.html
Second point of course is Sony is in deep trouble.Their consumer electronics business like TV's, VCR's, DVD's, camcorders etc etc are barely making a profit if at all, and they are taking a beating from Samsung in all of those products.
In Sony's latest results reported on Jan 26, their sales were down to the tune of 7.5%.
Microsoft quarterly profits are currently running at over twice that of Sony.
Extract from Sony's results:
"Sales for the quarter dipped 7.5 percent to 2.15 trillion yen (US$20.9 billion; euro16.07 billion) from 2.32 trillion yen.
Sony said its electronics sector suffered as sales of TVs and portable music players dropped.
.................................
In recent years, Sony has suffered from competition from cheaper Asian rivals such as Samsung Electronics. It has also fallen behind Japanese rivals such as Sharp Corp. in liquid-crystal display TVs and Matsushita Electric Industrial Co., which makes Panasonic brand products, in DVD recorders. "
Sony is in deep doodoo.
They are in no position to fight a nasty knuckle down price war with Microsoft when the net generation of consoles come out, while Microsoft is financially stronger than ever.