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1 Way Microsoft Could Beat Apple

The following video is part of our "Motley Fool Conversations" series, in which analyst Austin Smith discusses topics across the investing world.

When most investors ponder the future of the ever-connected living room, the usual candidates for success typically include Apple and Google. Noticeably missing from this list is Microsoft, the cheaply priced tech giant with deep pockets that often gets relegated to the boring category of "income-producing stocks." If you're trying to invest in a tech company for the future of home entertainment, though, it'd be a huge mistake to overlook this company. Despite lackluster performance in recent years, it has developed an incredible position, almost by accident, with the huge sales of its Microsoft Xbox 360 gaming console. The device is quickly becoming more of a media hub than many would have guessed, and the 60 million units sold could very easily give Microsoft the edge over Apple in this specific market.

As exciting as this may seem, though, most big tech companies are on the radar of so many investors that finding an edge can be hard to do. That's why we've uncovered a smaller, less-known company in our report "The Next Trillion-Dollar Revolution," which details a hidden component play inside mobile phones that also is a leader in the exploding Chinese market. Inside the report, we not only describe why the mobile revolution will dwarf any other technology revolution seen before it, but we also name the company at the forefront of the trend. Hundreds of thousands have requested access to previous reports, and you can access this new report today by clicking here -- it's free.

Austin Smith has no positions in the stocks mentioned above. The Motley Fool owns shares of Apple and Microsoft. Motley Fool newsletter services recommend Apple, Microsoft, Netflix, and Nokia. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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  • Report this Comment On April 17, 2012, at 4:00 PM, lucasmonger wrote:

    One thing to note, 60+M Xbox 360s sold needs to be taken with a grain of salt. How many people owned 2 or 3 Xbox 360s because of the "Red Ring of Death" (hardware defects that has plagued Microsoft for years).

  • Report this Comment On April 17, 2012, at 4:13 PM, lucasmonger wrote:

    I question whether the 60+ million number of Xbox 360s sold really represents 60 million potential users. There seems to be a relatively large number of Xboxes which suffered the Red Ring of Death hardware failure causing serious gamers who were hooked on Halo to buy more than one Xbox. According to http://en.wikipedia.org/wiki/Xbox_360_technical_problems one small sample showed 16.4% failure rate.

  • Report this Comment On April 17, 2012, at 5:43 PM, TMFBWItime wrote:

    @lucasmonger

    That's a great point. While all 60+ million sales may include many repeat purchases, and surely not all 60 million are an active and engaged audience, the sheer scale of these sales mean that even if a sliver of them pay off, it's big money for Mr. Softy.

    Fool on!

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