BusinessWeek reports today on the successes the XBox 360 has had with invading the living room as a sort of pivot piece on the personal cloud. From NewTeeVee’s coverage:

About half of all 25 million Xbox 360 owners pay $50 a year to subscribe to the Xbox Live service, pegging subscription revenue at about $600 million a year. And, according to an email that Microsoft COO Dennis Durkin sent to BusinessWeek, Microsoft is making more money from sales of media on its Xbox Live service than it’s making through subscription revenue. As a result, BusinessWeek estimates that Xbox Live pulls in at least $1.2 billion annually.

Last week, Frank Shaw of Microsoft’s PR group, sent out a missive to the “troops” that was pretty telling as to how Microsoft has matured in it’s understanding of the XBox and the important position it’s going to play in their strategy to keep the consumer markets moving forward. The post was entitled “Microsoft, by the Numbers,” and included a lot of interesting factoids. What caught my interest were these two sets of numbers:

16 million = Total subscribers to largest 25 US daily newspapers. ^[source]

14 Million = Total number of Netflix subscribers. ^[source]

23 million = Total number of Xbox Live subscribers. ^[source]

…And this number set:

$23.0 billion
Total Microsoft revenue, FY2000. ^[source]

$58.4 billion
Total Microsoft revenue, FY2009. ^[source]

The first number set is interesting because it shows the context in which Microsoft thinks about the XBox. Typically, Microsoft is blasted for taking a loss on the device in the early years. The foresight here is only just now becoming apparent, particularly when you take today’s BusinessWeek estimations in context of the numbers Shaw put out last week. XBox Live and XBox Media income accounts for nearly 2% of Microsoft’s total revenue!

In essence, Microsoft is building an ecosystem both on the macro level (in the same way that iTunes is building a media consumption ecosystem), as well as driving the need for people to keep a home private/public cloud structure. If you’re into collecting movies, TV shows, music and other media with your XBox as any part of that, the need will arise at some point for you to maintain a home media server (something that, quite famously, effortlessly integrates with other Microsoft-based devices).

With current and future versions of the XBox, the console doesn’t really mind where the data sits on your network (be it laptop, network device, media server or what have you), so long as it’s shared out. XBox plays it all as if it exists within the same volume. By corporate IT standards, this isn’t what’s traditionally thought of as private cloud, but it is the consumer equivalent to what’s currently emerging in that world.

We’re not used to thinking in these terms, but Microsoft is turning into a major driver for consumer level adoption of hybrid public/private cloud, in concept, if not reality.