Phil Spencer leaving Xbox

Phil Spencer specifically, and to a lesser extent Sarah Bond, leaving Xbox is bad for the industry as a whole. Let’s not fool ourselves they were both as Corpo as Corpo gets. They were profit driven, investor focussed and line must go up people that are prominent in every gaming corporation. The small but perceivable difference to me in that Phil at the very least was/is a gamer. There was a feeling of him being, in a small part, a Capital G Gamer. He seemed to enjoy games and always seemed genuinely excited by new games being released on all platforms. Standing awkwardly on stage speaking about a new game being released you felt his joy from gaming. There was much Corpo speak when they were discussing aspects of Xbox that were required to enthuse investors, an unfortunate necessary and vital part of any company.

Having said that I feel that Phil leaving is going to result in Xbox feeling like it doesn’t have a soul anymore. People have thrown all sorts of negativity towards Phil, but I have always had a different view on him. Microsoft is, and always has been, a corporation. More than any company they have often seemed to put their profitability before what their customers wants and need, leaving them feeling clinical and ruthless. Xbox has been no different. Microsoft’s drive towards AI has been rumoured to be slithering its way into their gaming division. Many of the layoffs Microsoft has done over the last few years have certainly been AI related. This is counter to what their consumers want in gaming.

This is where I feel possibly this was a step too far for Phil Spencer. It has always seemed to me that Phil was the dam that held back the tsunami that is Microsoft’s AI and profit first drive. This is not the first time I have felt that Phil has, through force of will, forced Microsoft in a direction they would not have otherwise gone. I would not see Microsoft creating and maintaining Game Pass for as long as they have on their own. It is still, even at its increased price, the best deal in gaming. Sure, the number of people who benefit from it has decreased and I do wonder how long it is sustainable as it remains in this no man’s land price range, where it is too expensive for the average gamer but not sustainable with just hardcore gamers.

Exclusives have slowly eroded away and a lot of this I think is due to Phil proving that Xbox is a thriving platform along with the increase in Steam users and the proof that there is money to made across platforms. Final Fantasy 7 remakes and 16 released on Xbox after a period which is different to in the past where it never would have done. The last Final Fantasy remake game is day and date on all platforms. The Monster Hunter games are no longer PlayStation exclusives but released day and date on Xbox. Online discourse revolves around the difference in console sales which clearly PlayStation has continued to dominate. But it is worth noting that with the acquisition of Activision Blizzard King Microsoft’s yearly revenue has drastically increased. The measure of success within the gaming industry differs from company to company. Game Pass has been reported to be profitable contrary to some reports and Xbox is now the biggest publisher of games across all platforms and has released a wide array of games from AAA to AA and through Game Pass has supported some indie devs to be able to release their games. The response from developers to releasing their games on Game Pass has mostly been positive with some devs who have done so claiming it boosted sales of their game. Games that have had success previously have released on Game Pass at a later date, such as both the Kingdom Come Deliverance games recently (great games worth a play on Game Pass or via purchase.)

I always go back to studios like Double Fine. A studio I have repeatedly said is one of my favourites. Before the Xbox acquisition, they repeatedly had to be creative in order to get the funding they needed to complete the games they wanted to make. These games are really well made and creative. But this has resulted in them being niche in the gaming world. So many people describe their games as beautiful and interesting but having no intention of plating them, but they are really quick to state that they are glad these games exist. Their newest game, Kiln, is a prime example of this. What an interesting idea for a multiplayer game. I cannot see it being a breakout success but on Game Pass it may very well find an audience and a small repeated player base. Double Fine is a studio that benefitted immensely from the Xbox acquisition. They have released 3 games under the Xbox umbrella and every one of them is bursting with that Double Fine creativity and flavour. They are a studio I was immediately worried about when I saw the news of Phil Spencer retiring and Sarah Bond leaving. They are prime for the inevitable cuts that are coming and the increased pressure to use Microsoft’s very costly AI systems when Asha Shama takes over. Her resume is what I would expect from Satya Nadella when picking a replacement, having worked at companies like Meta, Instacart and most recently at Microsoft’s Core AI. I imagine that Sarah Bond quit because she was not offered the post as was expected by many people, as it has been believed that she was being groomed as Phil’s replacement. Asha also has zero game industry experience.

Now there will be people who will welcome this news, especially that section of the internet who focus on console waring. They will relish in this news as they will feel that this a nail in the coffin for Xbox and therefore validates the little plastic box they chose as the best. What they fail to realise is with any weakening of Xbox means PlayStation and Nintendo will have less fear of failure and be emboldened to do as they please as their customers will be a captive audience. Xbox’s move to multiplatform for their games and the overhaul of the Windows OS in order to pair it down to a more game friendly system, has moved the console market towards a more open device similar to the PC. The reported inclusion of Steam and Epic stores on the Xbox console has forced PlayStation exclusive games onto the Xbox. This will, if not immediately, force PlayStation to rethink its exclusive strategy.

If the outcome is as many people expect, you can expect £80-£90 standard edition of games with over £100 for the more premium games. More early access and microtransaction in single player games. More DLC that have clearly been removed from the game with the intention of upselling post release content. Exclusive will return even though studios like Square Enix have realised that exclusives are losing them money. There will be increased and unfettered use of AI in game development. People will lose their jobs and the continuation of finding ways to eek out every last penny along with the reduction of quality will continue.

The games industry will continue on; it always has done. There have been multiple resets and the people who make interesting, fun and engaging games will continue to do so, just on a smaller scale. This will be a good thing in the long run. There will be new studios being founded in the tradition of Lionhead, Bullfrog, BioWare, ID Software and so on until the snake eats its own tail and much like the game studios of old, they will be bought up and consumed by Microsoft, Sont and EA.  This is a cycle that, like my mother said, if you get old enough you get to see history repeat itself.