Phil Spencer, the head of video gaming at Microsoft, has stated that there is no immediate necessity for a major upgrade of the Xbox game console. In an interview with Bloomberg News following the Xbox Games Showcase, Spencer explained that the company is currently content with the existing hardware.
During the event, Microsoft announced an improved storage version of the current Xbox Series S and addressed shortages of the higher-powered Xbox Series X, stating that supplies had been significantly increased. Major console upgrades are typically released approximately three years into the lifespan of a gaming machine. The Xbox Series S and X were launched in 2020 as part of the ninth generation of video game consoles and compete with Sony’s PlayStation 5.
Advancements in console hardware have become more incremental rather than revolutionary due to slower rates of capitalizing on hardware improvements. For example, the demand for 8K technology is not as high as 4K because some consumers cannot discern the difference, and cutting-edge hardware is costly.
Spencer acknowledged that Xbox is currently in “third place” behind Nintendo’s Switch and Sony’s PlayStation. Microsoft has diversified its game delivery strategy by making titles available through its PC gaming app and Game Pass subscription service. Spencer emphasized that he aims to prioritize players’ desires in determining product development. As a result, Xbox has not pursued trends such as non-fungible tokens (NFTs) or blockchain gaming, which have been met with skepticism in the gaming community.
Microsoft’s in-house game development has faced scrutiny from fans, particularly following the release of the critically-panned first-person shooter game Redfall by subsidiary Arkane in May. Spencer expressed disappointment in the release. However, during the showcase, Xbox presented 13 new games from its own studios, dedicating a substantial amount of time to Starfield, developed by the renowned Bethesda Softworks division.
Spencer stated that his team has not interfered with Starfield’s development and trusts the studio, known for its critically-acclaimed Elder Scrolls games. He emphasized his preference for supporting studios in realizing their vision rather than imposing external ideas.
Microsoft is currently pursuing its largest gaming deal to date, a $69 billion acquisition of Activision Blizzard Inc. However, the UK’s Competition and Markets Authority has blocked the deal due to concerns about potential dominance in the cloud gaming market, and the US Federal Trade Commission has filed a lawsuit to halt it. Microsoft is appealing the UK decision. Spencer did not comment on whether the company would withdraw its business from the UK as a result, stating that they would like to find a solution.
Microsoft has engaged in various partnerships to provide content and services to cloud gaming providers, including competitor Nvidia Corp. During the games showcase, Microsoft announced that some of its PC Game Pass titles would be available on Nvidia’s rival GeForce Now subscription service.
Spencer clarified that cloud gaming is not a separate market from consoles but rather an additional aspect. He believes that cloud gaming is additive to the overall gaming experience. – Bloomberg
13 June 2023
