My Hope for the New Era of Xbox

by Gamatroid 🕹️ 

 

Well that’s it. Phil is out and AI is in, or should I say, the former head of Microsoft’s Core AI product is in… the CEO chair for Microsoft Gaming. 

On Friday, February 20th, Microsoft announced that Phil Spencer was retiring and Asha Sharma would be the new head of Microsoft Gaming.

Prior to her new gig, Asha was head of Microsoft’s CoreAI product, and prior to that she was COO at Instacart and something over at Meta before that.

In her inaugural announcement as CEO, in the midst of a lot of typical corporate speak, Asha laid out “three commitments” for Microsoft Gaming:

1. GREAT games
2. Return of Xbox 
3. Future of play

Interesting...

In regard to "GREAT games", all she really has to do is not fire good people, not close great studios, and keep the momentum they have going. 

Luckily, Matt Booty was promoted to Chief Content Officer, so hopefully he can keep the game train on the tracks for the foreseeable future (assuming he is allowed to do his job). 

In regard to the "future of play", it was already heading in a cloud-gaming / AI-augmented direction. Given Asha literally ran one of Microsoft’s AI products, I’m guessing they’ll be all-in on AI. Too early to tell exactly what that will mean for both games and gamers. While I think AI has the potential to augment human production and be useful, I don't typically see it used that way.

The second one is where my head is focused at the moment: “Return of Xbox”. What exactly does that mean?

Xbox is gone? Xbox is broken? Xbox is "visiting her sister" but will "be back soon"?

Now, don’t get me wrong. I’m not saying I don’t think there are a gazillion things wrong with Xbox, but I found it odd for the new CEO of Xbox to say it so directly (especially since I would wager that her bosses were instrumental in its current state).

"Return of Xbox" sounds nice as a sound bite, but I want to hear specifically WHAT she thinks is off track today and HOW she’s planning to “return” it. I don’t think she means Xbox returning to being a console-first platform with exclusive games. That ship has seemingly sailed from both a branding and a practical economic standpoint unless major changes are made.

I DO think it’s interesting, however, that she is CEO of "Microsoft Gaming", and not Xbox [whatever]. I can see how that distinction could allow MICROSOFT games to continue being multiplatform (which they need to do from an economic standpoint), while defining Xbox as a hardware brand first. Now whether Xbox remains a traditional “console” or becomes a range of gaming products, from handhelds to consoles to high-end gaming PC’s has yet to be seen, but I can see how that distinction opens the door to that possibility.

The bottom line is, unless Microsoft Gaming simply want to be a bigger version of Activision-Blizzard (that is - a mega third party game publisher across all platforms), you have to own the interface with the gamer. Companies like Nintendo and Sony do that through selling lots of hardware, and then they tie their digital game stores to that hardware. 

Xbox lost the hardware war a long time ago, but it also hasn't had a compelling hardware strategy in a long time, and their PC gaming position isn't any better.

Microsoft let Steam run away with the PC gaming market a long time ago, and now Steam is getting ready to launch a series of hardware devices which will allow gamers to use Steam outside of any Microsoft ecosystem (although many will likely choose to keep using PC).

So where does that leave Xbox? I don't really know, and honestly I don't think their new CEO does either.

But what do I HOPE for Xbox? I hope to see a return to glory. 

What does that look like?

It looks like Xbox having the most powerful console on the planet, and ensuring their first party games look better on their hardware than anywhere else. This doesn't have to be because they are purposing nerfing their games on other platforms, but because their developers have more time to perfect the games on Xbox hardware and have the inside scoop on how to extract the most performance from it.

The Xbox Series X was arguably the most powerful console when this current generation released, but not powerful enough. For most games, you can't tell the difference between the version for the Series X versus the PS5, and that's a problem for Xbox. 

Image from https://www.youtube.com/watch?v=P0dWaA35VWQ

Now you might say, "but what about high end PCs?" I would argue this doesn't mean they need to try and beat high-end gaming PCs too. I still think console gamers and PC gamers are different breeds. 

Console gamers just want their games to look great and work well without all the constant upgrades and tweaking that PC gaming requires. Also, having a consistent hardware profile to design for and optimize games against is a huge help to deliver a great gaming experience. Sure PCs can scale up and down, but that delivers an uneven experience for gamers, even if it has the potential to outperform consoles.

Image from: https://www.youtube.com/watch?v=2HQwadK3aHo

This also means that Xbox needs to have a return to exclusives, from a console perspective, and even for PC it should have an exclusivity window where it stays console-only for a significant period of time (let's say six months to a year).

Nintendo will never launch its exclusives on other consoles, and its unlikely PlayStation will either. Sure some games could go multi-platform, but not their biggest hits. They both know the only way to maintain demand for their hardware is to have exclusive games people care about, and Xbox needs that too.

So where would that leave Xbox in the current Microsoft ecosystem? I think it needs to be separated from it.

I would argue Xbox should either be separated into a different division within Microsoft with its own leadership, outside of Microsoft Gaming, or at least it needs to be treated as a separate division within Microsoft Gaming, so it can chart its own destiny. Ideally I'd love to see Xbox spun off into a separate company altogether that Microsoft owns a stake in and has a long-term licensing agreement with, but that's probably too much to hope for.

From my perspective, Xbox doesn't need to be the biggest player in the games space, but it should be the best.

The best graphics and audio. Unique games that straddle the line between PC and console. The best online experience. All the things that made Xbox great in the beginning.

I believe they can do it. I believe they can return to their former glory and carve out a compelling niche for gamers that doesn't directly compete with either Nintendo or PlayStation, but the current path they are on isn't it.

So am I hopeful for the future of Xbox? Yes.

Do I think their new leadership structure will return Xbox to its former glory? Only time will tell.