All those rumors about Microsoft dropping out of the console businness are just that: RUMORS.
Allow me to explain:
Even though the Xbox is failing everywhere outside the US, that doesn't mean Microsoft is going to quit anytime soon. Microsoft has been completely dedicated to the development of their Xbox, they even invested over $500 million (yes I said MILLION) for the Xbox.
Microsoft has repeatedly said that they are in this for the long haul. Now that the company has suffered from the millions of dollars they lost this year, I doubt they will keep that promise for much longer. Developers have found that the Nintendo GameCube provides a much better investment, simply because it is succeeding in other countries just like the dominating PS2.
Microsoft hasn't brought any good 3rd-party development support for their system recently. 3rd-party companies are noticing that the system is indeed failing and are not going to risk developing for it because of this reason. That is why the GameCube and PS2 are doing so well, because more developers are supporting those systems!
As you may know, most of the dead consoles (Sega consoles: Dreamcast, Saturn, 32X, etc.) in the history of video games resulted because of poor developer support and lack of sales in foriegn countries. The Xbox is currently experiencing these same problems - a lack of exclusive 3rd-party support and poor sales in foreign countries. Does this mean that Microsoft is giving up?
No. Microsoft is still going to continue investing in the Xbox, even though it is a poor decision on their part. There is really no chance for the Xbox to survive, unless Microsoft can convince foreign gamers that the system is worth buying. They are desperately trying to drop the price by offering special "game bundles" but these are just costing the company even more money.
Many people have wondered if Microsoft would eventually end up buying out some major 3rd-party company (like they did with Rare). Sega and Capcom have been mentioned, yes those would certainly bring more support for the Xbox overseas, but Microsoft hasn't mentioned anything regarding a future buyout...
For now, let's just (happily) accept the failure of the Xbox. Microsoft tried to conquer the video game market with a promise of astounding developer support and a huge library of great games. But all we've gotten from Microsoft is a bunch of disappointments and poor sales figures...
Better luck next time Microsoft... HA HA! GameCube rules all!
