XBox One and Done?

Thr33X

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The following is an OPINION/OBSERVATION. I in no way am trying to insult or hate on Microsoft in this post.

This past week, Satya Nadella became only the third man in the 39 year history of Microsoft to be named it's CEO, succeeding Steve Ballmer, who succeeded company founder Bill Gates. Nadella's role previously was head of the company's cloud computing and enterprise business, a concept that's more prevalent now than it was in years past, as mobile computing has taken the forefront with the increase in availability and advancements in technology of smartphones and tablets. Slowly but surely the computing world is looking past the PC, and this is a fact that Microsoft's key rivals in the market, Apple & Google, have capitalized on, while MS has struggled to keep up with lackluster launches of both the Windows Phone and the Surface tablet.

So where does this involve video games you ask? Well, in a recent article in the Financial Times, it was cited that as far back as Steve Ballmer's tenure as CEO, MS faced repeated calls from investors to "shed consumer businesses such as the XBox game console and Bing search engine, and to focus instead on software for corporate and government customers". That's the department of business in MS that Nadella had headed before getting the CEO nod.

MS is undergoing a dramatic change in its business structure right now, and Nadella himself has echoed Ballmer's efforts to reposition MS around mobile computing and "the cloud", with an eventual emphasis on software and a new cloud based computing platform that would succeed its traditional PC business.

It's important to note that through all of these talks, nothing was mentioned about the future of consumer products and/or hardware being produced by Microsoft aside from mobile devices such as tablets. That's why it's in my opinion that there's the possibility that the Xbox One could possibly be MS's final foray into video gaming. Thanks in part to its lackluster launch and dwindling sales compared to the rival PS4, plus the ongoing presence of Valve and it's Steam Machines and Steam service, if ever there were a time to bow out, this would be it.

Now I'm not saying that they're going to dump the XBone, of course not. Their gaming division and Microsoft Studios are still in place and will ride out its commitment to this current generation of consoles, which stands to be probably the longest in the history of home console gaming, but when the next generation comes along, whatever it may be, it would not surprise me if by that time, with what Microsoft has planned for its business future, that they will announce that they are moving away from video games at very the least.

While other companies are poised to embrace video gaming in the far future, it sounds as if from the top down, Microsoft is eventually going to cut its losses and pull out when the time is right.
 

LaoJim

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Between the launch of the last generation and today's new generation there was 8 years. During that time the market saw the introduction and growth of new kinds of computing, notably Smart Phones and tablets. Who knows what the computing industry might look like another 8 years from now? (And the console companies may well try to stretch out this generation even further). Microsoft will probably continue research and development on new gaming technology for a while yet and then make the decision whether to go into a new generation. All kinds of things could affect that decision, such as new and disruptive technologies, a general games industry crash, Smart Phone games becoming dominant, whether the Xbox one holds its own against the PS4, how well Microsoft's other divisions and Nadella's own personal view of the worth of the Xbox. I doubt anyone in Microsoft knows for sure whether there will be an Xbox 2 yet, though I'm sure there are lots of execs who have their own competing 'vision' for the company.
 

Comocat

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I think the Xbox is a valuable vehicle to introduce a younger audience to the MS ecosystem. If you have a XboxLive, you might be more likely to adopt other MS products. With the CloudDrive and Office360 MS is looking more like Google, so dumping the Xbox would be foolish if they are trying to compel customers to "go all in" for MS products. The only reason I have an iPhone is I have almost 10 years of songs that I'm not interested in figuring out how to port to an Android system.
 

Maximum Bert

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It will be interesting to see really there is a lot to gain if one of them bows out. Nintendo arent exactly setting the world alight with the WiiU Sony is doing well with the PS4 but as a company arent that healthy and Microsoft are doing pretty good with the Xbox One but have been under pressure from investors to drop it for a long time as it costs them a lot of money.

Nintendo have put themselves in an awkward position but if MS or Sony bails out or goes belly up then the other stands to gain a lot also it would be a perfect time for another competitor to enter and fill a gap but they would have to be pretty big, Amazon maybe?
 

Atmos Duality

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Well, considering they just launched the Xbone and it hasn't bombed, I say Give it 5 years (or whatever the lifespan of the Xbone is projected at); There's plenty of time for something to influence Microsoft's mind on the matter (either way).
 

omega 616

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May 1, 2009
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Comocat said:
The only reason I have an iPhone is I have almost 10 years of songs that I'm not interested in figuring out how to port to an Android system.
I use double twist, more or less copy paste.

Anyway, have to agree ... nothing companies like this love more than to own a living room or your life. If you're a little fanboy then it makes it all the easier to milk you for all your worth, keep pumping out the products and premium services and your loyal army will buy them all up!

If you have nothing that is consumer facing, how do you recruit more into the microsoft army? "Your corporation needs you!"
 

Evonisia

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Jun 24, 2013
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Hold on, lackluster launch? It had the most successful Xbox launch and second best console launch of all time.

Given it's successful launch I'd say their opinions can easily change over the what will easily be a few years of life.
 

Thr33X

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Maximum Bert said:
It will be interesting to see really there is a lot to gain if one of them bows out. Nintendo arent exactly setting the world alight with the WiiU Sony is doing well with the PS4 but as a company arent that healthy and Microsoft are doing pretty good with the Xbox One but have been under pressure from investors to drop it for a long time as it costs them a lot of money.

Nintendo have put themselves in an awkward position but if MS or Sony bails out or goes belly up then the other stands to gain a lot also it would be a perfect time for another competitor to enter and fill a gap but they would have to be pretty big, Amazon maybe?
Amazon did buyout Double Helix, who were developing the Killer Instinct reboot for MS. I think all points right now suggest that they're at least planning to dip their toes into some kind of video game project, be it a console or service. But then that bares to ask the question (as fighting game aficionado Maximillian of YT fame asked), if DH was for sale, why didn't MS buy them, in the way they did the developers of Forza? One could think that maybe their not interested in any more long term developer deals for the reason of not planning to be in for the long term anymore.

While I'm talking about buying and selling, remember that Epic Games also sold Gears Of War IP to MS as well so they could focus on other projects not linked to XBone. If that doesn't scream "we're making our own hardware too in the future", I don't know what does.
 

Maximum Bert

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Thr33X said:
Maximum Bert said:
It will be interesting to see really there is a lot to gain if one of them bows out. Nintendo arent exactly setting the world alight with the WiiU Sony is doing well with the PS4 but as a company arent that healthy and Microsoft are doing pretty good with the Xbox One but have been under pressure from investors to drop it for a long time as it costs them a lot of money.

Nintendo have put themselves in an awkward position but if MS or Sony bails out or goes belly up then the other stands to gain a lot also it would be a perfect time for another competitor to enter and fill a gap but they would have to be pretty big, Amazon maybe?
Amazon did buyout Double Helix, who were developing the Killer Instinct reboot for MS. I think all points right now suggest that they're at least planning to dip their toes into some kind of video game project, be it a console or service. But then that bares to ask the question (as fighting game aficionado Maximillian of YT fame asked), if DH was for sale, why didn't MS buy them, in the way they did the developers of Forza? One could think that maybe their not interested in any more long term developer deals for the reason of not planning to be in for the long term anymore.

While I'm talking about buying and selling, remember that Epic Games also sold Gears Of War IP to MS as well so they could focus on other projects not linked to XBone. If that doesn't scream "we're making our own hardware too in the future", I don't know what does.
Yeah I knew that anyway but thanks all the same I like fighters so try and keep up with the news and I used to subscribe to Maxs channel but well I dont really like watching Injustice and KI and thats pretty much all that has been on there for ages so...yeah.

I have heard rumours that Amazon are developing their own android console which I cant see working out to well but you never know and as far as I am aware nothing is confirmed yet anyway.

As for MS not buying DH I can sort of see where they are coming from I mean KI is pretty much the only game they have made that hasnt been regarded as plain horrible and unfortunately that game isnt finished and the latest patch which they have partly gone back on (regarding its searching parameters) has made the game a lot worse.

Fighters dont bring in the megabucks (unless its Street Fighter 2 and we are in the 90s) the only reason KI is getting so much attention right now on the Xbox One is because there is little else out there and so it seems to me it could be one of a few things.

a) MS think they could get another team to do as good a job as DH or maybe they werent prepared to match Amazons offer.
b) They dont care enough about KI and will shift focus on to other games to sell their platform (thinking of Titanfall mainly here)
c) MS are considering selling the xbox division
d) DH are going to be hired by Microsoft still to assist on KI
e) Something else

I personally am waiting to see what happens to KI microsoft has said they consider it a success but I would take that with a pinch of salt as its one of their key games atm so they are hardly likely to say otherwise and as far as I know there have been no figures released of total amount of purchased copies or even downloaded copies (which should be pretty high). Time will tell though, hopefully they continue with a season 2 fix all the bugs and complete the game. I wouldnt be surprised if they stopped supporting it after Fulgore is released though.
 

Thanatos5150

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Evonisia said:
Hold on, lackluster launch? It had the most successful Xbox launch and second best console launch of all time.

Given it's successful launch I'd say their opinions can easily change over the what will easily be a few years of life.
I believe you missed the second half of that sentence, which is "Compared to its rival the PS4", which current market anaylsis will show is undoubtedly true.

I work a dead-end retail job, and even I can tell the PS4 is far outperforming the Xbone.
Anecdotal: My store has three Xbones on the shelf. We have zero PS4s. Part of this is due to something really messe dup in the supply chain (We've had PS4s on order for months, are only allowed to order one at a time at time of writing, and only have space on the shelves for two), but do you know what I get when I tell customers this?
"Ugh, nobody has one! Still!"
"Well, who has one, d'you know?"
"I guess I'll be seeing you this time next week?"

(Nearly) Everybody who wants an Xbone already has one. People are still hunting for PS4s.
 

Riff Moonraker

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What the heck do you mean a lackluster launch and dwindling sales? Neither are true! I still cannot wrap my head around people that seem to come up with this idea.
 

TomWiley

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Well in terms of sales, the Xbox One is undoubtedly a success, even though it can be discussed whether Sony's rival might have sold more. It depends on which statistics you look at, and one should keep in mind that Sony's console been released in many countries were Xbox One isn't available yet, and that the PS4 has a head start on a week or two.

That said, all of this is irrelevant. These consoles are going to be roaming the market for another six or seven years. If the last console generation taught us anything, it's that a lot can happen in seven years.

Nonetheless, perhaps Microsoft should sell the Xbox brand. The point is, it's really hard to make gaming consoles profitable and the Xbox One division stands for less than 3 percent of Microsoft's total revenue. It's a money-consuming sinkhole in their budget.

Of course, things are even worse for Sony. It took them five years to make the PS3 profitable, and in the long run, by most estimates, they seem to have lost more money than they made on the PS3 venture (not taking into account brand awareness and market visibility). So if Microsoft should sell their, historically, more profitable Xbox division, perhaps Sony should consider doing the same.

On the other hand, Sony doesn't really have anything to fall back on. 3D-TVs and smartphones aren't doing much for their bottom line. For Sony, it's hardware or nothing. The company must use their current intestinal fortitude and goodwill to find a new platform for profit, or find more ways to monetize on the PS4 platform. Because one thing is certain; hardware sales is not going to do it.

I think the death of the traditional video game console is going to come this generation. There's no money in it.
 

Saltyk

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Sep 12, 2010
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Evonisia said:
Hold on, lackluster launch? It had the most successful Xbox launch and second best console launch of all time.

Given it's successful launch I'd say their opinions can easily change over the what will easily be a few years of life.
According to VGChartz.com, as of February 1, 2014, PS4 has sold 5.1 million units, Xbox One has sold 3.4 million units, and Wii U has sold 5.7 million units. That's worldwide. So, while the Xbone may not have been a flop, when you compare it to the PS4, it's far and away being outsold.

To break down the sales further:
PS4
North America: 2.54M
Europe: 1.98M
Japan: N/A
Other: .54M

Xbox One
North America: 2.37M
Europe: .86M
Japan: N/A
Other: .21M

Wii U
North America: 2.46M
Europe: 1.2M
Japan: 1.62M
Other: .4M

Source: VGChartz.com [http://www.vgchartz.com/analysis/platform_totals/]

According to this, the PS4 is actually outperforming both competitors in any place that it is currently competing with them. Neither PS4 or Xbox One are out in Japan (or at least there is no Japanese sales data as I think PS4 just came out there). It's also plain to see that Xbox only really has any relevance in North America, though that remains in keeping with the last generation (you can check the chart to confirm).

While it may have been a great launch for the system, you do have to wonder if the investors feel that way. Especially since it's not outperforming the competition in the one area it dominated previously. The topic isn't completely unfair to bring up. And considering that by all accounts shareholders and the CEO are pretty much willing to cut out the Xbox division, it's not impossible.

Mind you, Sony isn't doing much better over all, either. Their nongaming divisions have been hurting for a while. But, if anything, they may double down on gaming as that is doing well for them.

Also, it does seem that Wii U has picked up a little steam, but not by much. Super Mario 3D World may have helped with the system sales, but they still need more and better advertising wouldn't hurt. They still seem to suffer from not telling consumers that the Wii U is an actual system and not an add-on.
 

Lightknight

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Nov 26, 2008
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Evonisia said:
Hold on, lackluster launch? It had the most successful Xbox launch and second best console launch of all time.

Given it's successful launch I'd say their opinions can easily change over the what will easily be a few years of life.
I think the comment was more to relay that their launch saw a significant loss in market share across all markets. Even in the US it has slowed down to a rate slower than the PS4 and the US market was firmly in the 360's hands (note that the XBO actually outpaced the PS4 week for week for the first two months until the last couple of weeks despite selling fewer units overall). Lackluster? Not relative to past launches, but it wasn't good with that considered. It isn't a triumphant return and the European markets look dismal for them and they've dropped out of Asian markets entirely (no Japan launch date, for example, the PS4 launches in Japan on Feb 22nd or three weeks from now).

This is somewhat disheartening though. There has already been significant talk of selling the division within Microsoft and we saw what they did with their online library. I would not trust Microsoft with a game library at the moment if I could help it. Not unless I see some kind of turnaround. I'm actually more worried about the instability of the division's future than I am about all of the anti-consumer shenanigans we saw, the price/power issues and the other potential problems.