Jason Schreier: Xbox Executives Were Blown Away by an Upcoming Game. Then They Canceled It

In five years they will basically be Minecraft+Blizzard+COD, everything else will fall by the wayside.

I'd probably add Forza Horizon and Fallout/TES to your list but, sadly, you're right. Instead of capitalizing on the trove of IPs they now own, they're just going to focus on the "safe" bets that rake in the most recurring revenue. 🤮
 
I kinda take this as a sign that Spencer either doesn't have enough juice with Nadella and Amy Hood to be able to defend this game, or he's remarkably incompetent to the point he'd completely forget about it and scrap it himself.

Either way not good.
 
The AI era is going to be painful
I just asked ChatGPT to elaborate on that.

Certainly. The phrase "The AI era is going to be painful" often refers to the complex, disruptive, and potentially difficult societal, economic, and psychological challenges that arise from the widespread adoption of artificial intelligence technologies. Here's a deeper look at what people generally mean by it:


1. Job Displacement & Economic Shifts

AI can automate many tasks currently done by humans—ranging from factory work to white-collar jobs like accounting, customer support, or even legal analysis.

  • Pain Point: Millions of jobs may be lost or fundamentally changed.
  • Impact: Mass unemployment, rising inequality, and economic instability, especially in sectors slow to adapt.
  • Example: Automation in logistics (e.g., autonomous trucks) potentially displacing millions of drivers.

2. Skills Gap & Rapid Adaptation Pressure

The rapid development of AI demands new skills—such as data science, prompt engineering, and human-AI collaboration.

  • Pain Point: People unable to retrain quickly may be left behind.
  • Impact: Social stress, educational inequality, and generational divides.
  • Example: Workers mid-career may find their skills suddenly obsolete.

3. Ethical & Social Challenges

AI introduces new ethical dilemmas, including:

  • Deepfakes, misinformation, and algorithmic bias.
  • Surveillance and privacy erosion.
  • Weaponization of AI (autonomous weapons, cyberattacks).
  • Pain Point: Trust breakdown in institutions and technology itself.
  • Impact: Social unrest, political instability, and civil liberties erosion.

4. Psychological & Existential Risks

Humans may face increased stress from:

  • Working alongside or competing with AI.
  • Loss of meaning as AI encroaches on creative fields and decision-making.
  • Pain Point: Mental health crises, feelings of irrelevance.
  • Impact: Identity crises, increased anxiety, and philosophical unease about human purpose.

5. Power Concentration & Inequality

AI development is largely dominated by a few corporations and nations.

  • Pain Point: Widening power gaps between tech elites and the broader public.
  • Impact: Geopolitical tensions, monopoly power, and democratic erosion.

6. Speed of Change

Perhaps the greatest source of "pain" is simply the speed at which AI is advancing:

  • New models and tools are emerging faster than legal, ethical, and cultural systems can adapt.
  • Pain Point: Overwhelmed institutions and constant need for adaptation.
  • Impact: Policy lag, constant uncertainty, and social instability.

Summary

The phrase doesn't necessarily mean AI itself is bad—it refers to the growing pains society faces during such a profound technological shift.
Those who recognize this phrase are usually emphasizing the need for preparation, careful governance, and societal resilience.

If you'd like, I can also share perspectives on how some think we can reduce this pain. Would you like that?



...would you like the pain to be reduced? AI can do that.
 
"Oh this game is great, we gotta cancel it otherwise we might have a hit on our hands"

- Phil Spencer, March 2025.
 
No one cancels good games people. If it was so amazing he wouldve put it out there to show everyone how good he's doing.
 
I'd probably add Forza Horizon and Fallout/TES to your list but, sadly, you're right. Instead of capitalizing on the trove of IPs they now own, they're just going to focus on the "safe" bets that rake in the most recurring revenue. 🤮
Yea, fair. I will point out that both FH and the Bethesda games have very long tails and/or are liveshit. So that's what all these games have in common. Maybe Grounded.

Games like Outer World, Doom, Indiana Jones, all this sort of shit, it's just not in the cards for them going forward. They cancelled the ones farther out but I don't expect these studios to be around much after they release their games. They're not going to be spending nine figures on games that come out, people subscribe to GamePass for a month for, and then move on. I think this is obvious but I am not sure people are picking up on it.
 
But then they could cancel other projects instead to save this "unbelievably awesome" project.
They obviously did that too, in the end there's probably other projects that either already made money or were closer to it that survived this one though. Or other factors played into decisions that weren't so - objective.
 
phil-spencer-xbox.gif
Phil can't have his reputation of 60s average games tarnished with a 90+ banger.
 
I would say that Sneaker has demonstrated his credibility many times over.

He's knowledgeable, great to converse with and if he says things are far worse than the insanity that was yesterday, I absolutely believe him.

I don't doubt that the MMO was very good, but being able to stand toe to toe with WoW or FFXIV would be a feat indeed.

WoW has always been popular and I think(haven't played in some time) that Final Fantasy XIV is still considered excellent(and it was when I played it).
 
Yeah, I aint buying this.

They just want to sound like they actually have good ideas and all. Probably there wasnt anything of value(beyond peoples job ofc) lost yesterday, which is sad, but MS and Xbox has been on a steady decline for years.
 
I am all for shitting on any big company, including Microsoft. But come the fuck on, now. If that game was really so unbelievable and the executives were really "blown away", they wouldn't have cancelled it.
That makes sense for a normally run company like Apple.

This is Microsoft we are talking about.

Know the difference.
 
My issue, in this specific case, is that ZOS was already making them a steady stream of money with ESO. (I'm saying this assuming that the rumor of the developer being ZOS is true)
Definitely not enough to justify the continued investment of an already 7 year project when the rest of the organization is also bleeding money. They're investing less resource into Call of Duty ffs.

This is different than other developers who were given money for years and ended up becoming a money sink due to no output.

This would be like Square Enix cancelling a secondary project from the FF14 team.
I think there would be a lot of sense in canning another long-term dedicated MMO. I do not personally think the market infrastructure is there given what's necessary in terms of investment to make a contemporary MMO that justifies a reset for the player bases of remaining titles, let alone pulling people away from existing live services and new AAAs.

SE has explicitly said that FF14 is losing its organizational lustre. Whatever ESO is doing is definitely not enough to push against the tide at MS. They're lucky that MS bought them in the first place and was dumb enough to continue the investment, because Zenimax was on the ropes anyway, and would've cancelled the project much earlier or released a quagmire and then shut down the studio years ago.
 
No one cancels good games people. If it was so amazing he wouldve put it out there to show everyone how good he's doing.

Nobody cancels the good games, but at the same time they all somehow manage to ensure they release all the bad games.
 
It doesn't matter how good the game looked or played if they didn't think they could make a profit off it.
 
Definitely not enough to justify the continued investment of an already 7 year project when the rest of the organization is also bleeding money. They're investing less resource into Call of Duty ffs.

I think there would be a lot of sense in canning another long-term dedicated MMO. I do not personally think the market infrastructure is there given what's necessary in terms of investment to make a contemporary MMO that justifies a reset for the player bases of remaining titles, let alone pulling people away from existing live services and new AAAs.
While we are not sure if it was going to be a fully fledged MMO (especially now that some people on GAF suddenly don't consider Dune: Awakening to be an MMO after it's success), I think ZOS had earned their chance, and their dev time, to make a good game.

They're lucky that MS bought them in the first place and was dumb enough to continue the investment, because Zenimax was on the ropes anyway, and would've cancelled the project much earlier or released a quagmire and then shut down the studio years ago.
"ESO has made nearly $2 billion lifetime and has no plans to stop expanding its world and story...making 15 million per month in revenue for over a decade."


Just to be clear here...this is the game that has them 'on the ropes' that you want to quagmire and shut down?

Are you sure we are discussing the same Zenimax Online Studios? Or are you thinking about Starfield and other studios at Zenimax? Two different entities if so.
 
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The role of game development is creating games, and releasing them to people now there's a group of people basically canceling everything, I say release it and let the people decide if it's resonates.
 
You sure?
100%.
If you are 'more efficient' you wouldn't be killing projects as the first port of call(let alone projects you don't have any people employed in). Firing people - sure - but killing projects is done for one reason only - saving money to hit a particular $ KPI (thus, not efficiency related).

And of course the PR - I've been through one of these at my own work this year, and of course AI PR was part of that story too (and you can take a guess how much it really contributed).

Keep telling yourself that my man
I'm not saying AI won't do this (and likely much much worse) - I'm just saying it (mostly) hasn't even started yet. This is just penny counters using it to save money 'now'.
 
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100%.
If you are 'more efficient' you wouldn't be killing projects as the first port of call(let alone projects you don't have any people employed in). Firing people - sure - but killing projects is done for one reason only - saving money to hit a particular $ KPI (thus, not efficiency related).

And of course the PR - I've been through one of these at my own work this year, and of course AI PR was part of that story too (and you can take a guess how much it really contributed).

You think the AI PR is bullshit? Yeah....I can see that. Trying to make the most out of the situation. That sounds like Microsoft alright
 
Dayum, Phil is cold: won't let me play the game anymore? Fine, you're canceled

angry giant panda GIF


Sucks that something that sounded like it had potential won't see the light of day. Isn't the first time for something like this to happen in the industry... Hope that the affected staff are able to find new jobs to support themselves+families
 
The only silver-lining to this, and this is just a hope beyond hope, is that this project's leadership and affected team members can exit quietly and simply chase this idea on their own terms.
 
...Obviously there's more to this story, but JS doesn't know, so he made up a weird angle, and that's all we got 🤷‍♂️
 
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Problem here is thses cunts lack passion and they just don't get it. Phil claims to be a gamer but hes the Glazeriers of gaming

They cant win, we won't allow them to, take a stand people.
 
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You just know Jason gets excited when there are these big lay-offs. "Payday, baby!" he thinks, as he Tweets and assures them he's on their side.
 
Seems like Phil genuinely loves games. Satya Nadella probably saw the numbers at Xbox and told Phil to bend the knee and make some cuts or lose your job.
 
While we are not sure if it was going to be a fully fledged MMO (especially now that some people on GAF suddenly don't consider Dune: Awakening to be an MMO after it's success), I think ZOS had earned their chance, and their dev time, to make a good game.
They had 7 years.

"ESO has made nearly $2 billion lifetime and has no plans to stop expanding its world and story...making 15 million per month in revenue for over a decade."


Just to be clear here...this is the game that has them 'on the ropes' that you want to quagmire and shut down?
2 billion in what? Profits? Or revenues? It's more likely to be the latter. It sounds like a lot of money, but over more than a decade, it really isn't. How much has the studio and adjoining support cost to run in those 10 years? It's obviously on a whole different level, but in a similar time frame, GTAO has done that by 3-4x in actual profit. And the same studio managed to release RDR2 and RDRO in the interim.

If you're not at that level, you cannot justify literal 10 year projects at MSFT.

Are you sure we are discussing the same Zenimax Online Studios? Or are you thinking about Starfield and other studios at Zenimax? Two different entities if so.
They're not two different entities, ZOS was owned by Zenimax. Zenimax overall sold to Microsoft because they saw the writing on the wall with the overall organization. Yes, I do believe that by the late 2020s, there would've been some existential events for that company had Microsoft not bought them. With or without ESO. There are things that exist way outside of it.
 


I took a peek at the comments and holy hell the Xbox proselytizers and/or reality deniers are responding in force. So many delusional takes calling the cuts "good for the industry" and praising AI for "making development tasks easier" and even trying to compare these cuts to when Musk slashed most of X's staff, as if Microsoft and X is a valid comparison.
 
I took a peek at the comments and holy hell the Xbox proselytizers and/or reality deniers are responding in force. So many delusional takes calling the cuts "good for the industry" and praising AI for "making development tasks easier" and even trying to compare these cuts to when Musk slashed most of X's staff, as if Microsoft and X is a valid comparison.
Some companies believe making shitty decision and paying / organising astroturfers to push a narrative is almost the same and spending to deliver better outputs.
 
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