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Red Herring: Indrema's mission impossible

Apr 07, 2001, 16:40 (12 Talkback[s])
(Other stories by Scott Tyler Shafer)

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"...Therein lies his difficulty in getting more funding. Venture capitalists look at Indrema, and then they look at its competitors. Then they decide they want nothing to with Mr. Gildred's dream. VCs know that developing and manufacturing game consoles is a capital-intensive endeavor. Even Microsoft acknowledged that launching the Xbox console, due out in October 2001, will sap the company."

"Mr. Gildred has a tough time proving to investors that his company can make money. A console's innards are not cheap, and even established manufacturers lose money on the console-sales end -- hoping to make it back by licensing their game-building tools to game developers. The developers pay the console makers for the tools and then sell their games to consumers. Indrema, with its open-source strategy, strays wildly from that model."

"Microsoft, meanwhile, has come up with its own developer-friendly plan. It allows developers to use familiar PC-development tools to make Xbox games. That gives developers a head start on the Xbox, whereas they have to learn completely new development tools to create games for Sony PlayStation 2. Microsoft's pitch has been so appealing that it has so far landed more than 200 game developers, leaving very few to work for Indrema."

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