Phil Spencer Pours Cold Water on Xbox Comeback Hopes

The debate over the so-called console wars is mostly redundant as so many of the most popular games are playable on both PlayStation 5 (PS5) and Xbox Series X (XSX). Still, given how much the hardware costs and the myriad of little details that split the experience on either console, it’s naturally tough not to feel a sense of allegiance, especially as the companies themselves clearly pivot themselves to compete.

As was the case with the last console generation, the PS5 came out hot, surging in sales with grand reviews and some very enticing exclusive games. At the same time, while it sold relatively well at first, the XSX floundered without the software to draw in the masses or much by way of a clear selling point. As a result, some 30 months after the two launched, the PS5 leads the XSX and Xbox Series S combined by close to 36 million to 21.35 million.

However, facing yet another poor console showing predominantly due to it being bereft of exclusives, Microsoft – Xbox’s owning company – went on a spending spree, snapping up big-name studios. Bethesda was one of the first huge acquisitions, costing the company $7.5 billion but allowing them to get some highly anticipated games as exclusives to the Xbox ecosystem.

Just proving how important exclusives are, God of War Ragnarök, a PS5 exclusive, sold over 11 million copies within ten weeks of launch. That’s over half as many copies as Xbox has sold consoles this generation. Most Xbox adopters are looking to Starfield as both the console’s first major non-driving game exclusive (driving games have been reviewed here at Overlook Press) and the chance to turn around Xbox’s fortunes. CEO Phil Spencer has recently quashed these hopes in an interview.

Spencer Doesn’t See Starfield as Xbox’s Savior

Phil Spencer has recently been doing the rounds on various YouTube channels, doing interviews and explaining the stance and situation of Xbox before what should be a major showcase on June 11. During the interview with Kinda Funny Games, Spencer said that they’re not here to be “out-consoling Sony” or Nintendo and that they want to make everyone on the Xbox feel as though they’re a “first-class citizen.”

Further, Spencer detailed that he doesn’t see great games as the golden ticket to turning things around for Xbox, predominantly because they lost the crucial generation battle with the Xbox One. As was recently reported by outlet GameSpot, the last console generation is seen as the point at which everyone pivoted to digital games. Thus, most gamers follow their digital library rather than switch ecosystems now. Another revelation came from the CEO when he said that even if Starfield is perfect, people won’t “start selling their PS5s”.

There was a lot to unpack from the interview. What shone through was the very reserved outlook or outright lack of optimism for Xbox mounting a challenge to its rivals. But the rise of the Nintendo Switch (over 127 million units sold) after the all-but-forgotten Wii U proves that one console doesn’t sink an ecosystem. Further, games will always be what sell consoles because people buy consoles to play games, so a great line of titles can be the golden ticket.

Tempering expectations is a good idea in the heated space, but if this is the true view of the CEO at the top of Xbox, it doesn’t bode well for the future. This is especially true of the desire to give the “first-class citizen” sensation when the new $500 Xbox Series X offers the exact same experience out of games as the Xbox One. On the other hand, the PS5 completely revamped its load-up, landing screen, controller feedback features, and navigation.

Perhaps Some Light on The Horizon for Xbox

Cross-platform, third-party games may still make up the bulk of playing hours for millions of gamers, with Grand Theft Auto V still popular with so many across home consoles and PCs, but the selling point of one console over another remains the exclusive games. The fact that the Switch is a hybrid is its own unique selling point, but when it comes to PS5 vs. XSX, it’s going to be down to the games – especially as the DualSense now exceeds the included Xbox controller.

Microsoft knows this, and it’s why the company has splurged billions on studio acquisitions, including an attempted $68.7 billion for Activision-Blizzard. Bethesda could be huge for getting players on the console and keeping them there. The Elder Scrolls V: Skyrim sold well over 30 million copies, per Bethesda’s director and executive producer, Todd Howard, and continues to be played en masse. Starfield is billed as “Skyrim in space.”

Starfield has been hyped up for years, particularly because it marks the studio’s return to beloved single-player games and is set to stretch modern gaming tech to its limits. On September 6, the epic sci-fi RPG will launch on the Xbox and PC, currently standing as only one of two long-revealed exclusives with a release window – accompanied by S.T.A.L.K.E.R 2. Hellblade II, The Outer Worlds 2, Fable, Everwild, State of Decay 3, and ARK 2 are all without release windows.

A Lack of Identity and Selling Point

The Xbox Series X continues to pin much of its hopes on its Xbox Game Pass, but there are several problems with this approach. For one, the most popular games are mostly the EA Play titles that are available on the PS5, as well as several other cross-platform games, with the highest-ranking exception to this rule being State of Decay 2. There are over 453 console games on the Game Pass, so it’s tricky to single out the few exclusives as flagships.

The library sprawls across genres, indies, triple-As, backward compatibility, and other media like movies and TV shows for purchase on the Microsoft store, but the selling point is hard to nail down. In other entertainment mediums, clear messages are hammered in even when there’s a wide selection of content. Adding new and exclusive content is a key selling point. This is how Netflix tries to keep ahead through its Netflix Originals series, which is being matched by Amazon’s Prime Video.

In another platform-based entertainment medium, casino gaming, one important selling point is simplicity and accessibility. The offering at Vegas Slots Online lists over 10,000 games. All of them are slots, and all are free to play. It carves out a niche targeting slots players while having the USP of the usually pay-to-play games being completely free. In mobile gaming, Apple Arcade separates itself from the usual app game marketplace through a small subscription fee to play full games on mobile that are without ads, paywalls, or microtransactions. As recently as the end of 2022, Xbox saw for itself how big a new eye-catching exclusive can be.

High on Life set multiple records upon launch in 2022, becoming: the biggest launch to Game Pass of the year; the biggest single-player Game Pass launch ever; and the biggest third-party Game Pass launch ever, based on player count. However, this was followed by a dud of an exclusive, Redfall, which launched teeming with technical issues. Reports suggest that some are getting “subscription fatigue” across the board, and at $9.99 per month, Xbox is giving little reason to invest $500 in a console and then $120 to play games that work just as well on PS5.

The Xbox Series X does need top-class, eye-catching, and working exclusives if it wants to become a success. If Starfield flops, perhaps its only big selling point of 2024 will evaporate.

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