It was not $2 billion, it was around $4 billion in losses, according to Forbes. That's why I used that figure earlier in the thread.
http://www.joystiq.com/2005/09/26/forbes-xbox-lost-microsoft-4-billion-and-counting/
Yes they did loose 4 billion, over the life cycle of the Xbox, NOT the first year. The first year as I stated they lost around 2 billion.