for them to be successful, gamepass aside, they should partner with Epic, itch.io, and other stores, imho. Epic Games gives you great games for free and joining forces might be the only way to compete with the almighty Steam in the PC department.
Xbox Business Update Podcast | Xbox Everywhere Direction Discussion
- Thread starter iroboto
- Start date
I still haven't seen a convincing path forward where consoles can have alternate stores and still be profitable. The hardware is sold at a loss or at a slim margin, they'd be giving away their only way to make money.
It is almost certain that they will merge the console with the PC. The form in which this will take place will be revealed soon.
If they pivot to becoming a profitable 3rd party developer then the outcome of any misfires with hw become negligible over the long term. So they have an opportunity to experiment and see what works and what doesnt while following the sure path, acquisition of successful studios and making those titles available on multiple platforms.
My problem with this speculation is it doesn’t actually explain anything. How can an ‘Xbox PC’ make money for Microsoft? Are they going to sell it at a profit per unit like a system integrator would? Is the store going to be still mostly locked down? Are they going to negotiate a cut with Steam?
If they pivot to being a third party developer why make hardware at all? If it’s not profitable and they don’t operate an ecosystem it sounds like they would just publish games on PS and Steam and stop making consoles.
My point is they are considering eventually leaving hw at this point just not being entirely open about it.
Oh gotcha, yeah that seems like the most likely outcome. Unfortunate since I much prefer Xbox over PS.
Charlietus
Regular
I think that a official Xbox for the fans is "always" going to be there, just not produced in huge quantities and sold at a profit, like the PS5 Pro.
The answer is subscriptions. Everything revolves around this at MS. It is easy to imagine a scenario where the powerful Xboxes manufactured by themselves will only represent the brand's reputation, and the devices launched by OEMs will cover the needs of the masses, and even make the entire Xbox gaming experience available on any PC with appropriate specifications. only a Gamepass subscription will be the key to it.
From this concept, it can be seen that they do not want to earn on the hardware, but on the subscriptions connected to them. In fact, this is still the case today, the current Xbox consoles account for the majority of Gamepass subscribers, and you can see that even with the relatively restrained amount of hardware on the current market, they have significant revenues. This is what they want to improve, and since this cannot be done with a closed console system, they are expanding their options.
Considering their state I would say MS’ over focus on subscriptions has seriously hurt their position this generation so I don’t think doubling down on that is a likely future.
Thanks to Gamepass, the revenues of the Xbox division increased significantly. There are separate statements that point out that the revenues are better not only because of the ABK acquisition, but also because of Gamepass, which has been stated several times.
In other words, Gamepass is the most important development opportunity for MS in the future. And believe it or not, subscription models are the future of gaming. Just because they sold fewer consoles doesn't mean they're doing poorly, quite the contrary, just look at the business financial reports.
Of course, they want to get more subscribers. Unquestionable.
Charlietus
Regular
Looking at the revenue charts, there isn't much growth outside of the bethesda-activision acquisitions.
I don't agree at all that subscriptions are the future. Game pass has stagnated already, even with those huge investments. F2P and GAAS games are taking over the market, that's the future that I can sadly see.
As I said, the amount of subscriptions is related to the amount of consoles, so it is clear that if I sell fewer consoles, the growth of subscribers has also slowed down. Well, that's exactly why they're switching to a new business model with Xbox. Their goal is to grow Xbox and at the same time the number of subscribers. All this will soon become clear how it will be carried out.
making Windows the most relevant and better OS for gaming is also a way to make money, directly and indirectly. If you improve Windows in a way that it becomes as usable as Steam OS -which makes you feel you are using a console- or even better, not only would make Windows more optimised OVERALL but also could make it the best OS to play games. Imho, it is the best OS for gaming nowadays, but there is a lot of room for improvement, to optimise the use of the hardware as much as possible.
If Microsoft were to create a hybrid console-PC running Windows underneath but optimized specifically for gaming, it could revolutionize the gaming industry.
Windows should double down on gaming, which is a massive market, with billions of dollars in revenue up for grabs. Windows already holds the crown for being the most widely used OS among gamers, thanks to its compatibility with a wide range of hardware and software, exclusive features like HDR support, and "full" backwards compatitility from 40+ years ago.
If Microsoft were to focus on optimizing Windows specifically for gaming, they could make the OS feel like a true console experience while retaining all the flexibility of a PC. This approach wouldn’t just cement Windows as the best gaming OS; it could also boost hardware sales, attract more developers, and grow the ecosystem.
A fully revamped "Game Mode" that goes beyond freeing up resources. This mode could:
- Automatically optimize settings for each game.
- Prioritize GPU and CPU tasks specific to gaming.
- Minimize background processes without impacting essential system functions.
Introduce a sleek, console-style interface that launches directly into a game library, a la Steam Big Picture mode, but better integrated with Windows features.
Partner with OEMs to create hardware specifically tuned for this hybrid device -say Windows Gaming Ultra Seal Of Quality, or Windows Gaming Medium Seal of Quality, etc- (devices for Ultra settings, for Medium settings, just having a standarized model like some games have a Steam Deck setting.
Custom drivers and firmware updates could ensure top-tier performance without user intervention.
Seamless Integration with xbox by enabling Xbox gamepass integration.
Supporting Xbox controllers and peripherals out of the box.
Allowing cross-save and cross-play between Xbox consoles and the hybrid device.
Continue to support older games while ensuring that new titles can take full advantage of the optimized OS. Compatibility layers like Proton but from previous Windows OSes could be implemented for non-native titles.
Allow direct hardware access and streamline Windows to allow games to have closer access to hardware, similar to what consoles do. This could reduce latency and improve frame rates significantly.
Let users create custom profiles for specific games, tweaking performance settings, RGB lighting, and peripherals for each title.
For users, a Windows hybrid console-PC would offer the best of both worlds: the ease of use of a console with the power and flexibility of a PC. Gamers would no longer have to choose between platforms.
For Microsoft:, by selling hardware and growing the Xbox/Windows ecosystem, Microsoft could see increased revenue both directly (hardware sales) and indirectly (Game Pass subscriptions, game sales, etc.).
Microsoft stands to gain financially from this concept in multiple ways:
Hardware sales: A hybrid console-PC would create a new category of devices that Microsoft could sell directly or through OEM partnerships. These could be priced competitively against gaming PCs and consoles.
Gamepass subscriptions as @QPlayer indicated: With seamless gamepass integration, more users would be drawn to subscribe. The convenience of a hybrid console-PC could significantly grow the user base.
Game sales and developer fees: if Windows is the most optimized and gamer-friendly platform, more developers would target it as their primary release environment. Microsoft’s share of game sales and developer fees could increase as a result.
Plus the hybrid device would encourage users to stay within the Windows and Xbox ecosystems, driving additional revenue from app sales, cloud gaming services, and accessories.
The platform’s popularity could attract advertisers and partners, opening up additional streams of income.
They have the best OS for gaming, make something out of it, over the years any gaming computer has always been a GREAT productivity computer too.
I agree its likely we'll still have some form of official Xbox even next gen, a single reference build for other OEMs to base on.
Good news is nothing's set in stone at the moment. Never know things could change, but if we're looking at things now, thats the trajectory. Its definitely a consideration they are making and are preparing for it.
I mean as you say, Windows is already the best overall OS for PC gaming. There is no marketshare here to gain, almost everyone already uses Windows for PC gaming, making it better won't change it for the better marketshare-wise, you can't go much above the 95% they already have.
I see this trope online a lot: Windows already does all of this. Xbox is basically shipped with Windows, Xbox controllers have been supported OOTB since the Xbox One days, cross-save and cross-save are ultimately a per-game situation (although almost every MP game is crossplay now between all devices, not just Windows <> Xbox), and Windows compatibility mode already exists.
At least we now know there was no exclusivity deal and MS was spreading lies to its influencers. In reality Game Science didn't have the resources to optimize the game to meet the requirements, otherwise they would have released the game as is which MS was not willing to do since they require feature parity. So essentially the Series X didnt get the game because of bad business decisions. This is what happens when you dont have your technical team decide hw/sw requirements. They better keep their different business functions independent enough to provide honest feedback otherwise the cycle of lying has gotten a bit out of hand.
Charlietus
Regular
From what I have seen, especially over the past year, Microsoft just wants to increase revenue in any way possible. In 2020-2022 they were pushing game pass hard, and it just didn't reach their goals. Now wherever increases revenue is a go, and so we are seeing games on playstation.
What do you mean with "growing Xbox"? The console or the brand?
I don't see Microsoft wanting the console to grow anymore.
we discussed this a few times. It's not that Windows doesn't have its merits, it's a great OS that has to work on many many computes, unlike closed OSes, which is pretty admirable, but look at what happened to the Amiga compared to MS-DOS. Amiga was the best computer to play games, but people switched to MS-DOS massively 'cos it used Mode 13H -a VGA exclusive thing- and Doom couldn't run on the Amiga. Doom made MS-DOS hugely popular, and that led to Windows becoming even more popular.
Shifty, which owned an Amiga computer, talked about it here.
Digital Foundry Retro Discussion [2024]
What I find outstanding is how well Wipeout aged. There is something about it's style, sound and motion that compose a more pleasing aesthetic compared to the modern wipeouts and similar games. The environments have elements of believability and groundedness compared to the overdone futuristic...
forum.beyond3d.com
Gaming on Windows represents a huge chunk of Windows revenue. Imho, anything that competes with that like the Steam Deck is a threat for Windows.
Imho, MS will make a console for whoever prefer consoles, also to help with gamepass, but gaming on Windows has been neglected for a long time.
Game mode, game bar and all stuff aside, it's not just about the apps, but how it feels to use Windows when gaming, and it could be better, more streamlined.
we discussed this a few times. It's not that Windows doesn't have its merits, it's a great OS that has to work on many many computes, unlike closed OSes, which is pretty admirable, but look at what happened to the Amiga compared to MS-DOS. Amiga was the best computer to play games, but people switched to MS-DOS massively 'cos it used Mode 13H -a VGA exclusive thing- and Doom couldn't run on the Amiga. Doom made MS-DOS hugely popular, and that led to Windows becoming even more popular.
Shifty, which owned an Amiga computer, talked about it here.
Digital Foundry Retro Discussion [2024]
What I find outstanding is how well Wipeout aged. There is something about it's style, sound and motion that compose a more pleasing aesthetic compared to the modern wipeouts and similar games. The environments have elements of believability and groundedness compared to the overdone futuristic...
Gaming on Windows represents a huge chunk of Windows revenue. Imho, anything that competes with that like the Steam Deck is a threat for Windows.
Imho, MS will make a console for whoever prefer consoles, also to help with gamepass, but gaming on Windows has been neglected for a long time.
Game mode, game bar and all stuff aside, it's not just about the apps, but how it feels to use Windows when gaming, and it could be better, more streamlined.
I am not sure this is entirely true. I dont think majority of the pople buy windows beoxouse they can play games on it. It is importand factor for many of them but not the primary. Today you can play play games on linux and in some cases better than on windows, but imagine someone going into store and buying a pc or laptop without windows on it.
i think 99% of people dont have any clue how to use linux. And gaming on Mac is just joke. SteamOS didnt convience millions to switch to it.
How does Microsoft make its billions? Microsoft revenue breakdown 2024
Back in the 90’ Microsoft was only about Windows - the first OS that went on global scale usage, and it was the only usable option for a long time. But over time, when new operating sy...
techbehemoths.com
"However, in 2022 Microsoft revenue from Windows (both OEM and commercial) decreased as percentage from revenue. In the company's annual financial report, it is stated that Windows generated $24,76B in revenue in 2022 which is 12.48% from the total revenue. "
OEM is stil the biggest income source when it comes to windows so if the manufacturers will start ship laptops and pc with SteamOS preinstalled i dont think they need to start worry. The fact that this does not happend today is a clear indication that there is very little demand for that. This may change of cousre, but it would have to go beyond gaming and the shift in consumer preferences to abbandon what they know and jump into completly unkonw OS that the only think they know about is "hard".
Similar threads
