Xbox will reevaluate exclusivity and target daily active players under new leadership
Things are changing at Xbox. At least, that's the message the division's new leadership team is intently putting across.
Yesterday, newly-appointed Xbox president Asha Sharma and chief content officer Matt Booty sent an email to Team Xbox employees around the world to pitch their vision for the business.
"The model that got us here won't be the one that takes us forward," reads the message. So, what changes are coming?
For starters, Sharma and Booty said Microsoft Gaming will be rebranded as Xbox and begin reviewing its approach to platform exclusivity, windowing, and AI. The first point is particularly notable given Microsoft has spent recent years bringing major first-party franchises like Gears of War, Halo, and Forza Horizon to rival platforms, including PlayStation.
The two leaders added that Xbox must bolster its presence on PC, while also improving the performance of its consoles by committing to more regular feature drops.
Ensuring the Xbox ecosystem remains affordable, accessible, and engaging is another major target.
"Pricing is getting harder for people to keep up with. And core experiences like search, discovery, social, and personalization still feel too fragmented. Developers and publishers are asking for more, too: better tools, better insights, and a platform that helps them grow faster," continues the email.
"At the same time, a new generation of players is coming online with different expectations. Their time is split across games, media, and everything else competing for attention. They expect more content in familiar places, want to shape the worlds they play in, and want to create and socialize together, not just play together."
There was also a candid admission that Xbox is currently a "challenger" as opposed to a market leader. Sharma and Booty said the division must employ a level of self-critique that feels "uncomfortable" to earn back the trust of its community and said the company's new north star will be daily active players.
It's an interesting tidbit when you consider Xbox hardware revenue has been steadily declining for some time. Discussing the prospects of its upcoming console. codenamed Project Helix, Sharma and Booty said the device must 'stabilize Gen9 as a healthy and high-quality base' by leading in performance when running console and PC titles.
"Xbox will be where the world plays"On the content front, they said Xbox must strive to "grow and extend an enduring portfolio of franchises players love" by evolving third-party partnerships and strengthening is five-year slate. Expanding into China and emerging markets is another priority.
The division also has an eye on "creator-centric" platforms like Minecraft, Sea of Thieves, and The Elder Scrolls, with Sharma and Booty noting that user-generated content platforms like Roblox are currently producing experiences that "rival major franchises in scale" at a fraction of the cost.
The pair added that Xbox Game Pass—which received a price drop earlier this week—must be fortified around "differentiation and sustainable economics" that create distinct value propositions. Sharma and Booty said they will also pursue mergers and acquisitions to "accelerate growth where organic paths are too slow."
Microsoft is no stranger to spending big on Xbox. Since the turn of the decade, the company has purchased Bethesda parent company Zenimax Media and Call of Duty maker Activision Blizzard for $7.5 billion and $68.7 billion, respectively.
Those seismic deals preceded years of widespread layoffs, studio closures, and project cancellations across Xbox Game Studios.
Microsoft has also faced pressure from the Palestinian-led Boycott, Divestment, Sanctions (BDS) movement and union workers at Arkane Studios, which accused the company of supporting an Israeli regime that a United Nations Special Committee said has been waging war on Palestine in a way that is "consistent with the characteristics of genocide."
With external and internal criticism mounting, Microsoft last year confirmed it was shutting down some technology services it had been providing to the Israeli Ministry of Defense that were allegedly being used to surveil Palestinians.
