The head of Xbox, Phil Spencer, speaks in an interview with the business magazine Bloomberg about the direction of Microsoft’s gaming division. He throws a jab at Sony and its expensive PS5 Pro, but also makes it clear that Xbox and Microsoft do not see future growth in core gaming, but rather with casual players and in the mobile market.
How does Phil Spencer throw shade at Sony? In the last answer during the interview with Bloomberg, Spencer says:
I have a pretty good feeling about the development of this industry. To reach new players, we need to be creative and adaptable regarding new business models, new devices, and new access points. We will not grow the market with $1,000 consoles.
This is clearly a jab at Sony, whose new core gamer console PS5 Pro costs around $1,000 if you get the necessary accessories.
It is, however, also a clear commitment to microtransactions and the mobile market.
Xbox seeks new customers in Asia and on mobile
What is it really about? Essentially, this is a directional dispute based on the following problem:
- The Western gaming companies have completely tapped into their “core market” over the last 30 years. People in Europe, North America – especially young men – who are tech-savvy and buy consoles or gaming PCs are already customers. No growth is to be expected here.
- New markets are now seen by the big Western gaming companies in Asia and South America. Additionally, they want to reach women and older people now. A target group that does not spend much time on games, who may not even own a console or PC, but rather a smartphone.
While Sony is doing more for the existing target group with a powerful console, Spencer makes it clear that he and Microsoft are focused on growth and chooses the second path.
Xbox is strongly moving towards mobile – Activision is supposed to help
What implications does this have for Xbox? Xbox’s growth strategy includes:
- Bringing its own games to Nintendo Switch and the PlayStation family.
- Publishing games on mobile devices from Apple and Google when they (have to) open their platforms.
- A planned Xbox handheld also goes in this direction.
As pioneers for the mobile offensive, Activision’s titles such as Candy Crush and Call of Duty Mobile are apparently to serve this purpose.
What are the disadvantages for core gamers? The changed strategy comes at the expense of some development studios at Xbox, which have recently been closed or heavily affected by layoffs.
The jab against the PlayStation console for $1,000 is ultimately also a decision for mobile devices and the new mobile market. Ultimately, it is the developers of niche core games like Prey who are suffering: Xbox closes 4 studios, fires dozens of employees – the boss explains why this had to happen
