Xbox Business Update Podcast | Xbox Everywhere Direction Discussion

[iroboto]

Xbox controller supply has been tight for months. Even from Amazon I had a several week shipping time.

Yea, assuming that once again, they were expecting a massive cloud push to happen in Nov and Dec, they likely had a bunch of Direct-to-Cloud controllers sitting around. This was leaked back earlier in the year and should have come out by now.

But with cloud being paused again, they probably have to make the decision to resume normal controllers or make cloud controllers the default.

We have tons of information and officially released information about their push for android and cloud. Thst was supposed to happen in Nov/Dec. we know those plans got stuffed by late Oct.

We have no official information about cancelling console strategies and what not. But everyone seems to be going that route.

Xbox is certainly not meeting internal targets, it’s clear they’ve been pivoting, but likely all of this because they’ve put a lot of momentum behind their cloud push, only to be stuffed. It makes it seem like Xbox has been sitting idle with no direction, but if you look closely they had
A) COD on game pass
B) Xbox store ready for android
C) Cloud components ready for players
D) cloud contorllers

All aligned and ready for November. Unfortunately that fell flat and oddly no leakers talk about that. That’s because leakers are all 3rd party folks, retailers etc. so the great pivot had to happen to make up for all completely failed launch. And now we see the effect of
A) lack of series x hardware
B) lack of controllers
C) exclusives all going multiplatform
D) push towards 3rd party mobile hardware
E) this is an Xbox campaign.

 

[Cappuccino]

It is, imo, a very real possibility they likely diverted a great deal of many chips for cloud in the lead up to the android store opening up, which unfortunately didn’t.

They have a bunch of cloud hardware and campaigns that are sitting dormant, and without them knowing when the Ninth Circuit will wrap up, they have to give up their cloud plans again and focus back on traditional strategies.

So they deliberately prioritized chips for cloud over their console line? Don't you see how this doesn't exactly bode well for Xbox hardware?

It is very clear where MS' priorities lie and tbh I don't really get it, who is seriously gaming 'on the cloud'? I get that I/we aren't exactly the average consumer in this segment but of all the people I speak to I'm the only one that's used something like GeForce Now or Xbox Cloud Gaming.

Some of the most popular games in existence RN are all twitchy shooters and are basically unplayable on the cloud so I really don't get it lol.

 

[Cappuccino]

I looked for a new Elite2 Core controller and they don't even offer a black version at the moment. Really smart product strategy.

I don't think they ever offered a black Core controller since the mainline one is black. Why not just buy that?

 

[QPlayer]

Yea, assuming that once again, they were expecting a massive cloud push to happen in Nov and Dec, they likely had a bunch of Direct-to-Cloud controllers sitting around. This was leaked back earlier in the year and should have come out by now.

But with cloud being paused again, they probably have to make the decision to resume normal controllers or make cloud controllers the default.

We have tons of information and officially released information about their push for android and cloud. Thst was supposed to happen in Nov/Dec. we know those plans got stuffed by late Oct.

We have no official information about cancelling console strategies and what not. But everyone seems to be going that route.

Xbox is certainly not meeting internal targets, it’s clear they’ve been pivoting, but likely all of this because they’ve put a lot of momentum behind their cloud push, only to be stuffed. It makes it seem like Xbox has been sitting idle with no direction, but if you look closely they had
A) COD on game pass
B) Xbox store ready for android
C) Cloud components ready for players
D) cloud contorllers

All aligned and ready for November. Unfortunately that fell flat and oddly no leakers talk about that. That’s because leakers are all 3rd party folks, retailers etc. so the great pivot had to happen to make up for all completely failed launch. And now we see the effect of
A) lack of series x hardware
B) lack of controllers
C) exclusives all going multiplatform
D) push towards 3rd party mobile hardware
E) this is an Xbox campaign.

This is stupid, the cloud-based game will always remain a secondary line, you just can't build on it. And the main reason for this is lag, LAG. The most successful service-based and multiplayer games are unusable in online streaming services, even single-player games do not offer the same experience as with a dedicated hardware, namely because of the resolution. The global internet infrastructure is not yet ready to play properly in 4K image quality at a stable 60 FPS. There are countries where 1 Gbit internet speed is common, but in most places only 50-100 Mbit is available.

They still have to make consoles or console PCs that do the math and display the graphics locally.

 

[Nisaaru]

I don't think they ever offered a black Core controller since the mainline one is black. Why not just buy that?

The full one costs 40 bucks more as the Core Edition. This would be now my 3rd Elite2 after 2Elite1 and 3 normal ones since 2013

 

[rntongo]

This is stupid, the cloud-based game will always remain a secondary line, you just can't build on it. And the main reason for this is lag, LAG. The most successful service-based and multiplayer games are unusable in online streaming services, even single-player games do not offer the same experience as with a dedicated hardware, namely because of the resolution. The global internet infrastructure is not yet ready to play properly in 4K image quality at a stable 60 FPS. There are countries where 1 Gbit internet speed is common, but in most places only 50-100 Mbit is available.

They still have to make consoles or console PCs that do the math and display the graphics locally.

Lmao you're pointing out whats obvious but not obvious to certain executives. They'll do anything to shift the blame of their failures instead of having focused executable strategies.

 

[Seanspeed]

For the Xbox One controller? That did include tooling as well. They rolled the initial statement back to 'over $100m'.

Hopefully we'll get to see more of their experiments one day. They didn't show them as part of the 20th? anniversary thing as far as I remember. They played around with all sorts, including a smell emitter.

If they resurrect smell based gameplay that 'most powerful generational leap' might have a whole context we didn't expect.

Tooling is part of costs. They 'rolled the initial statement back' because they realized how ridiculous it made them look. Microsoft do not know how to do 'lean' development and spending.

And what's even worse about this is that the actual XB1 controller we got was super boring. The idea that they even spent $100m+ on it only to pump out that functionally fine, but entirely unremarkable controller is depressing. They'd have done much better to just make a higher build quality X360 pad(which I still think is ergonomically superior) and saved most of that money.

 

[iroboto]

This is stupid, the cloud-based game will always remain a secondary line, you just can't build on it. And the main reason for this is lag, LAG. The most successful service-based and multiplayer games are unusable in online streaming services, even single-player games do not offer the same experience as with a dedicated hardware, namely because of the resolution. The global internet infrastructure is not yet ready to play properly in 4K image quality at a stable 60 FPS. There are countries where 1 Gbit internet speed is common, but in most places only 50-100 Mbit is available.

They still have to make consoles or console PCs that do the math and display the graphics locally.

Firstly, not stupid for a variety of reasons.
A) our network technologies do exist today for mobile game with near 0 latency. On the 5G network which is much easier to deploy globally and in rural areas, they have an area called multi access edge computing, which is really edge computing designed for mobile. Standard networks can’t get there, only the mobile networks can. It’s basically edge computing near where you are getting cellular service.

It’s design for realtime mobile applications, one of them is video game streaming, yet we have not had a company do that type of deployment yet, capital costs are considerable.

Combined with the fact that it’s becoming easier for service provider to provide home internet using 5G instead of fibre to the home.

Cloud streaming is an eventuality, the cross over point is going to be soon.

B) no mobile screen is 4K or needs to be.

C) the next generation of players have been playing Minecraft and Roblox. On their iPad for nearly free. The numbers here are massive. I can’t stress it enough, there are more Roblox players than all of console players combined.

So you have a situation where you have generations of kids growing up with devices that do a heck lot more than a gaming console, while playing these games for free, what makes you think they’ll agree with growing up and dropping $1000 on a console?

PC/Mac gaming is growing rapidly, because those are the tools they use for everything, streaming, content creation, school, chatting, social media, Netflix, and gaming. Consoles will never be able to replace that. You’re kidding yourself in thinking it will ever be able to.

So if you got the next generation of gamers, who are used to having slim slates to play on, there’s virtually 0 options available for them to have higher fidelity gaming outside of streaming.

Why pay tons of money for a console and a massive TV? When a simple iPad + mouse or controller will do? And they can play it anywhere they have a 5G connection.

Yes you may feel like MS is leaving you behind. And that’s precisely what everyone is doing. You’re aging out, if you’re 30-40, that population of gamers isn’t going to increase over time, but decrease and rapidly. I barely play games as it is today. I likely won’t be in 5 years time at all. Streaming will save me boatloads of money provided the service is good and GeForce Now is likely the one to get if high fidelity is what you want.

 

[QPlayer]

Firstly, not stupid for a variety of reasons.
A) our network technologies do exist today for mobile game with near 0 latency. On the 5G network which is much easier to deploy globally and in rural areas, they have an area called multi access edge computing, which is really edge computing designed for mobile. Standard networks can’t get there, only the mobile networks can. It’s basically edge computing near where you are getting cellular service.

It’s design for realtime mobile applications, one of them is video game streaming, yet we have not had a company do that type of deployment yet, capital costs are considerable.

Combined with the fact that it’s becoming easier for service provider to provide home internet using 5G instead of fibre to the home.

Cloud streaming is an eventuality, the cross over point is going to be soon.

B) no mobile screen is 4K or needs to be.

C) the next generation of players have been playing Minecraft and Roblox. On their iPad for nearly free. The numbers here are massive. I can’t stress it enough, there are more Roblox players than all of console players combined.

So you have a situation where you have generations of kids growing up with devices that do a heck lot more than a gaming console, while playing these games for free, what makes you think they’ll agree with growing up and dropping $1000 on a console?

PC/Mac gaming is growing rapidly, because those are the tools they use for everything, streaming, content creation, school, chatting, social media, Netflix, and gaming. Consoles will never be able to replace that. You’re kidding yourself in thinking it will ever be able to.

So if you got the next generation of gamers, who are used to having slim slates to play on, there’s virtually 0 options available for them to have higher fidelity gaming outside of streaming.

Why pay tons of money for a console and a massive TV? When a simple iPad + mouse or controller will do? And they can play it anywhere they have a 5G connection.

Yes you may feel like MS is leaving you behind. And that’s precisely what everyone is doing. You’re aging out, if you’re 30-40, that population of gamers isn’t going to increase over time, but decrease and rapidly. I barely play games as it is today. I likely won’t be in 5 years time at all. Streaming will save me boatloads of money provided the service is good and GeForce Now is likely the one to get if high fidelity is what you want.

It goes without saying that the mobile game market is already huge, you don't need to go into the future for that. However, we're talking big-screen spectacular AAA and AA games in this context. This also has its market, which, as you said, is also growing thanks to the PC.

If we were to deal with this topic so much
on the subject, if everyone only played roblox-like stuff, they would assume that all you need is a cheap cell phone and that's it... but no, we know very well that there is a group of players who pay billions for TV and for modern games that can be played on a monitor. And it's not age-related. Older and younger people play with consoles and PCs just like before, and this will not change in the future either. Well, they won't suddenly switch to mobile, that's for sure, not to mention the cinema-like experience provided by AAA games or the huge success of complex multiplayer games. They are still a user base of hundreds of millions.

As far as mobile Internet 0-latency networks are concerned, it is still a long way off, not to mention that it remains to be seen how it all works in practice. However, comparing the two gaming segments is pointless, again, those who want to play AAA games on a big screen will never look at a par-inch mobile to play with. These are two separate categories and markets.

 

[rntongo]

It goes without saying that the mobile game market is already huge, you don't need to go into the future for that. However, we're talking big-screen spectacular AAA and AA games in this context. This also has its market, which, as you said, is also growing thanks to the PC.

If we were to deal with this topic so much
on the subject, if everyone only played roblox-like stuff, they would assume that all you need is a cheap cell phone and that's it... but no, we know very well that there is a group of players who pay billions for TV and for modern games that can be played on a monitor. And it's not age-related. Older and younger people play with consoles and PCs just like before, and this will not change in the future either. Well, they won't suddenly switch to mobile, that's for sure, not to mention the cinema-like experience provided by AAA games or the huge success of complex multiplayer games. They are still a user base of hundreds of millions.

As far as mobile Internet 0-latency networks are concerned, it is still a long way off, not to mention that it remains to be seen how it all works in practice. However, comparing the two gaming segments is pointless, again, those who want to play AAA games on a big screen will never look at a par-inch mobile to play with. These are two separate categories and markets.

Spot on tbh.

 

[Seanspeed]

Cloud streaming is an eventuality, the cross over point is going to be soon.

- Xbox, circa 2010

 

[fehu]

Xbox Series X|S console sales fell by almost 50% in 2024 - KitGuru

For the past generation or so, Microsoft has been actively pivoting its Xbox business away from the

www.kitguru.net

I must be math bound, what's 48% of 11?

 

[Cappuccino]

So if you got the next generation of gamers, who are used to having slim slates to play on, there’s virtually 0 options available for them to have higher fidelity gaming outside of streaming.

All of this ‘next generation’ are playing Fortnite on monitors and TVs lol. The idea that everyone’s on mobile is silly unless we’re counting Bejeweled-playing housewives as a core gaming demographic.

 

[iroboto]

All of this ‘next generation’ are playing Fortnite on monitors and TVs lol. The idea that everyone’s on mobile is silly unless we’re counting Bejeweled-playing housewives as a core gaming demographic.

So I made another thread pointing to this data source, as it will likely be a larger discussion there.
The link to this deck is over here:

Matthew Ball State of Gaming industry 2025

This is a critical piece of work done by Matthew Ball and there is a really long slide deck with 100 slides of analysis. It is absolutely worth reading through. I personally agreed with a lot that he wrote about. And I hope the information provided there gives you some real answers why...

forum.beyond3d.com

But when I'm talking about what you see happening, Sony cancelling GaaS, MS going multiplatform, cloud etc, all the challenges everyone is facing, can all be found in this 100 slide deck, you just have to read through a lot.
I'm very thankful it was released, because this amount of work is massive.

So I mean, I get you guys want games industry to be a particular way, but I beg you all to go through the entire deck and read through the challenges and costs of making games, which in turn, why expensive consoles are not hitting it off.

I'm saying anyone here is right or wrong. But for myself, when I'm providing a point of view, I'm looking for data sources to help back those suggestions. And this deck has the data you for need that. And this deck, has showcases why Xbox should be getting out of the console segment. I think it's very obvious the console industry is indeed shrinking once you go through this deck. It's not just MS killing itself causing a negative feedback loop.

The forever games, which is titled black hole titles, is straight up killing the market. There's little to no more growth, and a mobile strategy for AAA games is a potential new growth driver. That's i'm tryign to say here, I'm sure MS has equivalent data to this deck.

 

[QPlayer]

So I made another thread pointing to this data source, as it will likely be a larger discussion there.
The link to this deck is over here:

Matthew Ball State of Gaming industry 2025

This is a critical piece of work done by Matthew Ball and there is a really long slide deck with 100 slides of analysis. It is absolutely worth reading through. I personally agreed with a lot that he wrote about. And I hope the information provided there gives you some real answers why...

forum.beyond3d.com

But when I'm talking about what you see happening, Sony cancelling GaaS, MS going multiplatform, cloud etc, all the challenges everyone is facing, can all be found in this 100 slide deck, you just have to read through a lot.
I'm very thankful it was released, because this amount of work is massive.

So I mean, I get you guys want games industry to be a particular way, but I beg you all to go through the entire deck and read through the challenges and costs of making games, which in turn, why expensive consoles are not hitting it off.

I'm saying anyone here is right or wrong. But for myself, when I'm providing a point of view, I'm looking for data sources to help back those suggestions. And this deck has the data you for need that. And this deck, has showcases why Xbox should be getting out of the console segment. I think it's very obvious the console industry is indeed shrinking once you go through this deck. It's not just MS killing itself causing a negative feedback loop.

The forever games, which is titled black hole titles, is straight up killing the market. There's little to no more growth, and a mobile strategy for AAA games is a potential new growth driver. That's i'm tryign to say here, I'm sure MS has equivalent data to this deck.
View attachment 12898

I have been seeing such statistics for about 15 years, and the AAA PC gaming market, which can be considered expensive, is still performing better and better... The current console market also has a user base of 200 million. All of these devices include dedicated rendering hardware for AAA games.

Mobile and streaming are a completely different category.

 

[Cappuccino]

So I made another thread pointing to this data source, as it will likely be a larger discussion there.
The link to this deck is over here:

Matthew Ball State of Gaming industry 2025

This is a critical piece of work done by Matthew Ball and there is a really long slide deck with 100 slides of analysis. It is absolutely worth reading through. I personally agreed with a lot that he wrote about. And I hope the information provided there gives you some real answers why...

forum.beyond3d.com

But when I'm talking about what you see happening, Sony cancelling GaaS, MS going multiplatform, cloud etc, all the challenges everyone is facing, can all be found in this 100 slide deck, you just have to read through a lot.
I'm very thankful it was released, because this amount of work is massive.

So I mean, I get you guys want games industry to be a particular way, but I beg you all to go through the entire deck and read through the challenges and costs of making games, which in turn, why expensive consoles are not hitting it off.

I'm saying anyone here is right or wrong. But for myself, when I'm providing a point of view, I'm looking for data sources to help back those suggestions. And this deck has the data you for need that. And this deck, has showcases why Xbox should be getting out of the console segment. I think it's very obvious the console industry is indeed shrinking once you go through this deck. It's not just MS killing itself causing a negative feedback loop.

The forever games, which is titled black hole titles, is straight up killing the market. There's little to no more growth, and a mobile strategy for AAA games is a potential new growth driver. That's i'm tryign to say here, I'm sure MS has equivalent data to this deck.
View attachment 12898

Expensive consoles? What expensive consoles?

Gaming PCs are significantly more expensive than this round of consoles and they’re doing even better, even as prices continue to increase.

All those Roblox kids aren’t ’gamers’. I really dislike when people do this with gaming industry stats. It’s like saying FarmVille moms are gamers and that’s why we need to abandon consoles and make games for Facebook. The millions of people playing Roblox were never in the market for AAA titles (maybe they will one day but for now not really).

Not to mention Minecraft and Fortnite are primarily console and PC titles. They have mobile versions but they are afterthoughts compared to the main event. So using them to justify this cloud push makes no sense.

 

[rntongo]

So I made another thread pointing to this data source, as it will likely be a larger discussion there.
The link to this deck is over here:

Matthew Ball State of Gaming industry 2025

This is a critical piece of work done by Matthew Ball and there is a really long slide deck with 100 slides of analysis. It is absolutely worth reading through. I personally agreed with a lot that he wrote about. And I hope the information provided there gives you some real answers why...

forum.beyond3d.com

But when I'm talking about what you see happening, Sony cancelling GaaS, MS going multiplatform, cloud etc, all the challenges everyone is facing, can all be found in this 100 slide deck, you just have to read through a lot.
I'm very thankful it was released, because this amount of work is massive.

So I mean, I get you guys want games industry to be a particular way, but I beg you all to go through the entire deck and read through the challenges and costs of making games, which in turn, why expensive consoles are not hitting it off.

I'm saying anyone here is right or wrong. But for myself, when I'm providing a point of view, I'm looking for data sources to help back those suggestions. And this deck has the data you for need that. And this deck, has showcases why Xbox should be getting out of the console segment. I think it's very obvious the console industry is indeed shrinking once you go through this deck. It's not just MS killing itself causing a negative feedback loop.

The forever games, which is titled black hole titles, is straight up killing the market. There's little to no more growth, and a mobile strategy for AAA games is a potential new growth driver. That's i'm tryign to say here, I'm sure MS has equivalent data to this deck.
View attachment 12898

One thing's for certain is the dude really spent some time on this, he has a lot of insightful analysis but has a huge black spot in his reasoning.There's a lot of interesting things but I'll start with the most obvious:
1.) About GTA 6/future game pricing on slide 216 onwards, his conclusions are ridiculous. Consumers dont want to spend any more on base games especially in this era. They are already $70 and a lot of them are of poor software quality(something he seriously glaringly doesnt seem to appreciate or be aware of) especially compared to older generations. Suicide Squad Kill the Justice League, Forspoken, Starfield, Redfall, Halo Infinite etc These are titles that launched looking and or playing like d**kie. In order for consumers to want to pay $70 or more for a base game it has to be A+ not a C- AAA. I can see GTA 6 possibly being above $70 for the base game but even then they'll need to be careful how this impacts their initial sales as too high a price may dent their initial sales. They'll still sell $$ billions though regardless. But no one wants to spend $100 on a single base game. And no one wants to pay more than $70 for base games.

2.) ~slide 186 He's right MS's strategy hinges on regulatory changes/impositions on the mobile market dominated and established by Apple. But the implications of such regulatory impositions is not positive. For example Its assumed having multiple stores on a mobile device will drive growth. As a software engineer I cannot think of anything more ridiculous. I dont want to develop for 20 different app stores. Apple, Android is enough if I have to do anything mobile related. As a consumer I dont want 20 different app stores. If thats what I wanted I wouldnt have bought an iPhone in the first place. MS and Epic hoping to impose their app stores through regulatory changes of Apple's well established ecosystem will backfire. It will be back to the nasty days before the iPhone or consumers will simply not install such app stores or not use them.

3.) He lightly mentions how AI can help in creating new experiences, halt the growth in production costs, basically increase production efficiency. I think this should have been the core of his analysis. And not just AI(as he correctly asserted) can achieve this but generally improving the SDLC and the creative process. A lot of the issues with gaming today that drive up costs and lead to failures are related to terrible creative choices which lead to costly delays when it becomes evident consumers are not interested in whats being served.

4.)

The State of Video Gaming by Matthew Ball | Epyllion

Read The State of Video Gaming by Matthew Ball | Epyllion by Matthew Ball on Issuu and browse thousands of other publications on our platform. Star...

issuu.com

This slide was proof for me he needs to do more work/focus on creative challenges and issues with the software development process. Thats a core issue missing out from his analysis and would give him more colour.

Riding off point 3, Gaming experiences on consoles especially this gen have been underwhelming. But this isnt due to fundamental issues with the industry but temporary headwinds brought about by the aforementioned issues related to creative choices, headwinds in the SDLC(which can be rectified with or without more modern AI tools) especially during COVID that imho we still havent gotten over. There needs to be more of a focus on creating new fun AAA experiences instead of the cookie cutter stuff thats out there, and a shorter time to triangle as emphasized by Cerny. His assertion that there were more AAA titles released in 2023 than in any other year doesnt sound right. A lot of AAA titles come out half baked, and ready to monetize. The cracked programmers and designers of yesteryear that delivered complete and fun experiences dont have the forefront anymore it determining what/how games will be made.


5.)

The State of Video Gaming by Matthew Ball | Epyllion

Read The State of Video Gaming by Matthew Ball | Epyllion by Matthew Ball on Issuu and browse thousands of other publications on our platform. Star...

issuu.com

There are serious issues plaguing mobile game companies as well. MS's strategy would hinge on in the medium term having the ability to impose its own app stores onto Apple's well established ecosystem.

6.)

The State of Video Gaming by Matthew Ball | Epyllion

Read The State of Video Gaming by Matthew Ball | Epyllion by Matthew Ball on Issuu and browse thousands of other publications on our platform. Star...

issuu.com

Most of these games flopped because they genuinely sucked not because of some macroeconomic, sociological change related to hours spent on x platform and y platform on x media and y media. Gotham knights, Suicide Squad, Forespoken, Redfall either played or looked nasty when they came out. There's so many "AAA" titles that arent as fun as games released 10 years ago.



So it all boils down to good games unlike what people like Phil think. No amount of regulatory wins is going to save bad games. MS needs to consider that