I'll begin by noting that Xbox isn't the only games company to have made multiple rounds of lay-offs in recent years. And it isn't the only one to close studios.
Perfect Dark and Everwild, the two announced games that Xbox has cancelled today, were troubled projects. Sometimes game development just doesn't work out.
And although Microsoft and Xbox may be delivering strong numbers, it's fiscally irresponsible to continue investing in things that aren't working. Not just for shareholders, but existing employees, too.
All of that is true. But what is also true is that the last ten years for Xbox has been defined by a persistent failure to deliver.
Xbox never did recover from that 2013 Xbox One launch, when it lost ground to PlayStation and has continued to do so ever since. In an effort to recover, the company embarked on a strategy that centered on a subscription service (Game Pass), with a new console that featured a higher and lower-end variant (Xbox Series X and S).
But it couldn't deliver the games. Halo Infinite and Starfield, two important tentpole releases, arrived late and failed to connect with fans. Some of the studio leaders blamed ineffective and small marketing campaigns, which was a consequence of Game Pass eroding the margins on these first-party releases. But the games were also not quite good enough.
You can have the best strategy in the world, but if you can't deliver hit games, then it counts for nothing.
The Xbox project has failed. And as a result, Xbox is now a third-party publisher. One with a console and a subscription service, but a third-party publisher all the same. It is committed to hardware, but its partnership with Asus on the Xbox handheld, and the news of a Windows-focused future for its platform, suggests a different commitment to the one we're used to.
Messaging this transition to its loyal and confused fans has been tricky, and the company appears to have adopted the 'boiling the frog' approach of gradually releasing more and more games on PlayStation. Xbox gamers may not like it, but hopefully this will help the company deliver better financial results for its games and studios… even if it comes too late to save its console business.
www.thegamebusiness.com
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