At least somebody is happy with the state of Xbox. With Xbox now 75% through an urgent restructuring plan that has seen thousands laid off, many games canceled, and several studios severed or consolidated, Microsoft CEO Satya Nadella says the “streamlining” going on is “great to see.”
Asked about the state and future of Xbox on Sources Podcast by Alex Heath, Nadella says “I feel fantastic about the IP we have right now. If I look at the studios, the IP portfolio we have, and our ability to then take that and produce great games going forward, I feel fantastic.”
This has been the story with Xbox for years, especially after a string of high-profile business acquisitions. It’s hard not to feel good about IP and production with the likes of Minecraft in your corner, or with the entire Activision Blizzard fleet – well, the people who weren’t laid off – behind you. But how is Xbox doing?
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“There’s some amount of streamlining the team is doing, and Asha is doing, which is great to see,” Nadella observes, tipping his hat to new Xbox CEO Asha Sharma. Which is just an incredible way to describe the dismantling of longstanding studios, the uprooting of thousands of lives, and the ongoing closure of creative powerhouses that were generally doing just fine before Microsoft bought them.
What’s next for Xbox? With these “fantastic” IP, and after all this “great” streamlining, what then? “And then we have to invent the right sustainable business model that allows us to deliver gaming to more and more people,” Nadella continues, never actually exploring what sort of model might rescue Xbox or how this invention might compare to the strategies that other publishers and platform holders have successfully followed for decades.
“That has always been the goal,” Nadella reiterates. “We want to be a great publisher and a great platform provider for games, across both PCs and Xboxes. That is sort of our goal, and I think Asha and team have said that Xbox is gonna get back to growth this next fiscal year, and that’s the plan they’re executing on, and in that process do a bang-up job of producing some great games.”
There really isn’t a lot to chew on here apart from the casual glossing over of a seismic business overhaul now bookending several bloody years for Xbox. It’s the C-suite equivalent of an NBA coach saying, ‘We’re gonna win this game by scoring more points with our great players.’ But then Nadella, especially recently, has seemingly only seen Xbox in his peripheral vision when he pauses to take a breath between swings of the big-ol’ hammer labeled gen AI.
For a deeper analysis of Xbox’s hardships and options, I’d point you toward John Kimmich, a 16-year Microsoft veteran who was there when Xbox got started. In his view (and others’), Nadella’s outlook may be part of the problem: you have to be a good platform or a good publisher, but when you demonstrably can’t handle one, you certainly can’t be both.
