paidContent 50: The world’s most successful digital media companies

$3,928,000,000 (5% of total)
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Microsoft’s Online Services Division houses Bing (gaining on Google but still way behind), MSN (still wrestling with the role of a modern portal but boasting significant scale), adCenter and other advertiser tools. Its Entertainment & Devices Division mostly houses Xbox Live services. Microsoft recently sold its stake in MSNBC.com, the pioneering multimedia news initiative formed with NBC in 1996.

Microsoft has recognised Xbox is its best shot at entertainment. By encouraging more developers to sell games online through Xbox Live Arcade, it is ushering in the era of top-title game retail via console download – and helping to put bricks-and-mortar game sellers out of business. Microsoft opened Xbox up to TV and movie services, again taking a cut. Games are no longer front and center for this living room box.

The Online Services Division reported 18 percent higher revenue of $2.528 billion in Microsoft’s 2011 annual report. In the Entertainment & Devices Division, we estimate Xbox Live revenue that Bloomberg estimated at $1.2 billion the previous year rose to $1.4 billion. We have added these two together.
Source: 2011 Annual report and our estimate based on 2010 Bloomberg estimate