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Xbox in crisis: Why Microsoft's exit would be bad for the industry

Nachdem Microsoft und seine Xbox viele Jahre eine ernstzunehmende Konkurrenz für die Playstation darstellte, scheint sich das Unternehmen aus Redmond im Konsolen-Geschäft seit dem Debakel um die Xbox One nicht mehr so recht erholen zu wollen. Dabei müht man sich im Nordwesten der USA wirklich ab. So investierte man viel Geld in neue Studios und

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Xbox in crisis: Why Microsoft's exit would be bad for the industry

After Microsoft and its Xbox represented serious competition for the Playstation for many years, the Redmond company no longer seems to want to recover in the console business since the Xbox One debacle. People are really struggling in the northwest of the USA. A lot of money was invested in new studios and video game giants like Activision Blizzard and the Game Pass also has a powerful and interesting service in its portfolio. Phil Spencer's efforts to somehow please all gamers are now a hallmark of the Xbox brand, which slowly but surely seems to be running out of steam.

What happened at the GDC? Competition stimulates business. Everything more expensive and boring?

As early as January 2024, there were numerous rumors that Microsoft would bring the majority of its Xbox-exclusive titles to other consoles, including big names like “Starfield” and “Sea of ​​Thieves”. While these claims only partially turned out to be true, the leadership of the Xbox division tried to smooth things over and promised in a podcast not only new hardware in 2024, but also that they wanted to stay in the console business and are working flat out on the next one Generation. So everything is fine with Xbox, right?

xbox series
The Xbox Series X is actually a well-thought-out console – but it's still in trouble.

What happened at GDC?

But then came this year's GDC in San Francisco, during which the future of the Xbox seemed to be thrown into question at several points. This is based primarily on statements from GamesIndustry.biz boss Chris Dring, who summarized everything in an episode of the in-house Mircocast. For many publishers and game manufacturers, it is simply no longer profitable to put time and effort into porting titles for the Xbox hardware. This statement is said to have been made by, among others, a larger publisher who published one of its most important titles on the Microsoft console last year. The European market in particular is a problem because it only consists of Playstation 5 and PC, and the Xbox business is stagnating. So Europe no longer seems to be working for Microsoft, Asia – and especially Japan – have always been difficult video game markets for the Redmond company. If you go by the current figures from Statista, the PS5 is now ahead in the USA and has sold better than the Xbox Series devices in almost every month since its launch. But what other options does Microsoft have? Should you finally give up the video game business and become a software manufacturer like we discussed in February?

Competition stimulates business

A withdrawal by Microsoft from the video game market would have fatal consequences, that much is certain. Because if we assume that Nintendo sticks to the fact that it is always a generation behind in terms of technology with its upcoming console and therefore remains outside the competition, Sony and its Playstation would be the sole rulers in the games business. And no one can want that! Not even the Playstation Ultras among the players.

Because Sony was always strongest when it had a decent competitor. With the first Playstation, this was primarily Nintendo and its sheer preponderance of exciting IPs, which had to be beaten with in-house developments and clever exclusive deals. This was the only way milestones like “Final Fantasy 7”, “Metal Gear Solid” and “Gran Turismo” were possible.

After the immense success of the first two Playstation generations, Sony's nasty arrogance came to light. A high starting price, a complex development structure and missing the online trend with the Playstation 3 quickly gave rise to the rival console Xbox 360 and led to a head-to-head race that lasted for years. Sony narrowly won that, but the marketing strategy for the Playstation 4 made it clear that they had to do a little more. And ultimately this was also reflected in the software releases, which for the PS4 can safely be described as “pure madness”. Without this setback, would there ever have been such great original developments as “Ghost of Tsushima”, “Marvel's Spider-Man”, the reboot of “God of War” or the epochal “The Last of Us: Part 2”?

The last of us
Would highlights like The Last of Us Part 2 have been possible without the near-defeat of the PS3?

Everything more expensive and boring?

I also see another argument against Microsoft's withdrawal from the console business in the financial design of hardware, accessories and ultimately games. Because – even if it hurts as a fangirl or fanboy – Sony, as a listed company, ultimately wants your money above all and is not doing any of this for the benefit of the players. If a competitor were to disappear, the Playstation mother would have full control over the market and could dictate prices as much as it wanted. After all, people have been talking about AAA titles for a long time now that game development has become too expensive and that the current pricing model can no longer be maintained. And if the consumer no longer has any comparison to competing products, they can also add a few euros to the controller, the Playstation Plus subscription or the console itself. Nobody notices anymore…

Last but not least, it would also harm the diversity of video games. Because every console manufacturer has its own focus on developments, be it single-player titles with a strong story focus, long-lasting online games or entertaining indie gems. Without Microsoft's Xbox Live Arcade service, there might never have been the glut of brilliant, small game developments from lesser-known studios that are so valued today. If a company dictates the development of a game with its guidelines, this can only lead to a boring monotony that certainly no player wants to experience. Because video games are one thing above all else: diverse! And that would be completely lost in a market without healthy competition – and the Xbox. So dear Microsoft: Get up, wipe your mouth and carry on! You are still needed!

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