[hnlmorg]

Xbox One sold 58 million so it’s a bit of a stretch to call it’s a failure.

The thing you’re missing is the exact point I made in my previous comment:

Microsoft’s strategy is to own the software stack. They’re not really a hardware company. Xbox One was more about leveraging Microsoft as a platform. And Xbox Live is a very competitive and highly popular service. You don’t need an Xbox for Xbox Live. But you do need a subscription to Microsoft for it. The Xbox was just there for people who still wanted to pay the upfront cost for a dedicated gaming system but it was never Microsoft’s priority.

This is also fully in line with how Microsoft has pivoted most of its business over the last two decades: Microsoft Office and Azure AD are great examples of how Microsoft have switched emphasis to subscription-based services.

Much as I prefer physical hardware, it’s hard to deny that Microsoft’s approach is the the future. PlayStation might appear like they’re more successful than Xbox today but in a generation or twos time, people won’t be buying new hardware like they are today. We are already seeing this trend in fact. And Microsoft have a massive head start in the subscription games market. So unless Sony switch gear soon, they’re more likely to go the way of Sega than Microsoft are.

As for Nintendo, it’s hard to guess what will happen there but I suspect they’ll weather the change in consumer habits because they have both the IP and the unique position of being more positions as kids toys than grown up gaming devices.

[scheeseman486]

Xbox as a console is a failure in as much that it's coming third in a market of three and that in response to that, Microsoft are significantly changing their strategy, something they probably wouldn't have done if they were market leader.

But I agree with you on all points and I think the direction Microsoft are going in is the right one, though they should have done it sooner, the Series consoles have felt rather superfluous. They should have been working on adding a solid console UI to Windows a generation ago.

[hnlmorg]

> Microsoft are significantly changing their strategy, something they probably wouldn't have done if they were market leader.

You have cause and effect the wrong way around there. Microsoft have been pushing this strategy from the start.

There’s a reason they partnered with Sega to put Windows CE on the Dreamcast. And their failed attempt at XNA on the Xbox 360. It was always about owning the software layer rather than them being a dominant hardware manufacturer.

If they cared about hardware then you’d see Microsoft PCs. Instead we have decades of IBM-compatible clones, some half hearted attempts at Windows Phones, which they again didn’t manufacture the hardware for, and a few Surface Pros which are basically just templates to inspire HP et al into action.

The Xbox was always about software dominance but at the time MS knew they had to get their software onto the consoles first.

Whereas Sony was originally a hardware company. They didn’t even own any studios when the first Playststion was released (hence why they released an SDK for the Playststion while Sega still expected 3rd party developers to write assembly like their in house teams were)

So the difference in hardware sales isn’t at all surprising when you factor that in.

If you look at Xbox Live subscriptions you’ll see just how hard Microsoft are pushing this strategy. And to get where they are with it, it cannot have been just a reactionary approach due to coming 3rd in hardware sales. The fact that Microsoft Windows has been pushing Xbox Live for literally years too is further proof of that.

Also when you look at some of the controversial decisions regarding the Xbox One, which MS backtracked on, those unpopular design choices make much more sense when you think of the console as a fat terminal for subscription-based games.

I’m honestly a little worried for the future of the Playststion because if things pan out the way they’re going presently, Sony might just end up an OEM for Xbox Live compatible devices.

> They should have been working on adding a solid console UI to Windows a generation ago.

A lot has been said in the past about Microsoft’s design team and not just for the Xbox One. They’re the only billion dollar company that consistently gets UI more wrong than Amazon.

30 years ago I honestly think they were best in class for designing UIs. But somewhere around XP they lost their way and they’ve been getting worse at it with each coming year.

[scheeseman486]

If Microsoft could have a large piece of the console market, they would have taken it, corporate strategy be damned. Whatever got them into the market (and you're right, they did it as a long term power play for the living room) doesn't mean Microsoft has some kind of purity of vision or grand unchangable plan, their corporate culture is notoriously factional and fragmented. They aren't a hardware company... until they are.

There are risks to giving it up too. Make the Xbox open and Steam could potentially gobble up what's left of a la carte game distribution on PC. Xbox Live is inevitably going to die, why pay for online services when every other store offers them for free? All that's left is Game Pass, but the long term viability of subscription models for games is shaky, they're getting more subscribers but they aren't hitting their target numbers and they need to scale for it to be able to turn a profit.

There's the cloud and they're in a great position to compete there, but I remain unconvinced that it's good enough. It's less a primary way to play games and more a value-add, most people, even casuals, seem to treat it as such. And what about them owning the software layer? They don't even have a monopoly on running Windows software anymore, at least in the domain of games. I suspect this might be a problem for them down the track.

The way I buy their games is as Microsoft only as publisher, since I buy them on Steam. I play them on my Linux PC. In a way, they're already Sega post-Dreamcast.

[hnlmorg]

> If Microsoft could have a large piece of the console market, they would have taken it, corporate strategy be damned. Whatever got them into the market (and you're right, they did it as a long term power play for the living room) doesn't mean Microsoft has some kind of purity of vision or grand unchangable plan, their corporate culture is notoriously factional and fragmented. They aren't a hardware company... until they are

You’re making a hypothetical point here though. And not only hypothetical, but one that flys directly against all of the actual behavioural evidence we do already have.

> There are risks to giving it up too. Make the Xbox open and Steam could potentially gobble up what's left of a la carte game distribution on PC. Xbox Live is inevitably going to die, why pay for online services when every other store offers them for free? All that's left is Game Pass, but the long term viability of subscription models for games is shaky, they're getting more subscribers but they aren't hitting their target numbers and they need to scale for it to be able to turn a profit.

You’re completely missing the point of what Xbox Live is here. It’s not just support for online play, it’s “free” AAA games and game streaming. It’s Steam, Google Strava and PlayStation Plus all rolled into one. It works on PCs, tablets and even Meta Quests too.

That’s why MS are buying studios and why the Xbox is less relevant. Hardware becomes irrelevant if you’re streaming the games to customers.

It also got a massive user base already. In fact they’re the leading online gaming service provider. And if you read any of the market analysis for this online gaming services, streaming and gaming from non-traditional gaming hardware (eg portable devices and XR headsets), those markets are set to explode in popularity over the next 10 years.

Apple knows this too, which is why they have Apple Arcade. But Apple are focused on hardware lock-ins while Microsoft are focused on software dominance.

> There's the cloud and they're in a great position to compete there, but I remain unconvinced that it's good enough.

They already dominate there ;)

> It's less a primary way to play games and more a value-add, most people, even casuals, seem to treat it as such. And what about them owning the software layer? They don't even have a monopoly on running Windows software anymore, at least in the domain of games. I suspect this might be a problem for them down the track.

Competing for operating system dominance is a thing of the past. Outside of server licensing, no one charges for desktop operating systems any more and mobile operating systems have always been a free bundle. Plus with more and more applications being web-based, half the time the “operating system” is just a web browser.

Microsoft knows this, which is why Edge is based on Chromium and why Windows 11 is a free upgrade.

These days real revenue is generated from subscription based services. Hence the Office 365 and the Azura AD examples I gave. Hence why Apple are moving into subscription services. Hence why Adobe products are now subscription based. Whereas what you’re describing is the industry 10+ years ago.

> The way I buy their games is as Microsoft only as publisher, since I buy them on Steam. I play them on my Linux PC. In a way, they're already Sega post-Dreamcast.

That explains why you have very little understanding of Xbox Live and Microsoft’s pitch for subscription based gaming services. :) I don’t mean that in a negative way, just that you haven’t really explored cloud gaming yet so haven’t been exposed to just how large that market already it.

Personally I much prefer your way of gaming too, albeit I’d almost always opt for physical copies if any exist. I’m definitely and old school gamer. So I can’t say I relish this new future where you don’t own the title you play. But like it or not, that’s where the industry is going.

Have a read about some market analysis for online gaming services and popularity of gaming platforms. Quite a lot of them are going to be industry-aimed and thus not free to read but there’s enough resources out there that you should get an idea of what I’m talking about. The whole console industry is on a verge of a significant shift. It’s like the shift from cartridge to optical disc. Or from single use circuit controlled games to ROM cartridges.

[scheeseman486]

> You’re making a hypothetical point here though. And not only hypothetical, but one that flys directly against all of the actual behavioural evidence we do already have.

How is any of that hypothetical? Microsoft has always been opportunistic.

> You’re completely missing the point of what Xbox Live is here. It’s not just support for online play, it’s “free” AAA games and game streaming. It’s Steam, Google Strava and PlayStation Plus all rolled into one. It works on PCs, tablets and even Meta Quests too.

No no no. You do this repeatedly, trying to say that I'm naive, it's extremely condescending. I've tried this stuff, I know how it works, I understand what the technology is and the services on offer. I just don't believe the hype, I don't think streaming is the panacea for video games and based on the way I'm seeing most people around me engage with video games, I don't think I'm alone in thinking that.

Latency will always be worse and the only solver for that is throwing expensive graphics hardware into edge datacenters. Meanwhile, smartphones are starting to run AAA games without needing to stream anything at all, compatibility layers are being developed that allow for Windows games to run on ARM/Android. You're not wrong that "gaming on everything" is becoming a thing, but I don't think relying on streaming alone is going to cut it.

You sound like the people hyping up Stadia. Games everywhere, man, streaming is the future! I'm sure you'll try to make the argument that their business model was a poor fit (it was) but a subscription model wouldn't have saved them either. The future isn't streaming, the future isn't a la carte, it's all of those sales models at the same time. The future of Microsoft as a games company is that they sell their games any way people want to buy them, that is, they act like a regular old publisher.

[hnlmorg]

> How is any of that hypothetical? Microsoft has always been opportunistic

It’s hypothetical because you are discussing a different reality to the present.

Hypothetically you might be right, but seems unlikely given their past actions and the current industry trends. However it’s impossible to prove or disprove your point because it depends on conditions other than our current reality.

> No no no. You do this repeatedly, trying to say that I'm naive, it's extremely condescending.

I don’t mean to be condescending. However it’s going to be difficult to discuss Xbox Live without actually discussing the features of Xbox Live.

> I just don't believe the hype, I don't think streaming is the panacea for video games and based on the way I'm seeing most people around me engage with video games, I don't think I'm alone in thinking that.

The “hype” is a combination of extensive market research that extends far beyond your social circle, and the intentions of big corporations.

You might be right that the reality will not live up to the hype, but citing your evidence as “based on how most people around me engage with video games” isn’t a particularly wide sample.

Seriously, read some of the market research on this (I have, given my background and social circle also being industry experts) and it massively contradicts your anecdotal analysis on Microsoft and the wider games industry: https://duckduckgo.com/?q=video.game.market+research&t=iphon...

> Latency will always be worse and the only solver for that is throwing expensive graphics hardware into edge datacenters.

Latency isn’t a problem for all types of games.

You’re also focused on just one aspect of subscription services and an area that’s still underdeveloped at the moment too.

Lastely there have already been examples of streaming games that have proven the concept does actually work.

> Meanwhile, smartphones are starting to run AAA games without needing to stream anything at all, compatibility layers are being developed that allow for Windows games to run on ARM/Android. You're not wrong that "gaming on everything" is becoming a thing, but I don't think relying on streaming alone is going to cut it.

Alone it won’t cut it. I never claimed Xbox Live was a streaming service alone. I said it was an area for growth.

> You sound like the people hyping up Stadia. Games everywhere, man, streaming is the future!

A future, not the only future.

Subscription services are the future but there multiple facets to that. I’ve repeatedly discussed each of them so I’m confused why you keep thinking online can only be one thing or another.

> The future isn't streaming, the future isn't a la carte, it's all of those sales models at the same time.

That’s literally what I’ve been saying. Are you even reading what I’m posting or just automatically opposed to them because I disagreed with your assessment on Microsoft and the “failure” of the Xbox One ?

> The future of Microsoft as a games company is that they sell their games any way people want to buy them, that is, they act like a regular old publisher.

You’re implying that people have the ultimate say in how they consume software yet history has proven that rarely proves to be the case. For example Adobe moving to subscription model.

You’re also implying that most people don’t want a subscription abased model for gaming when actually it’s already proving very popular with people who like to play lots of different games (as the market reports I’ve linked to have demonstrated).

Fortnite “Seasons” is a similar concept. While the base game is free, you have to pay for any season exclusives. Epic saw a massive growth in revenue and engagement after switching to this model. While on the surface this model might seem contradictory to the subscription model, it’s really not:

Both other regular updates offering exclusives to keep people coming back, and those exclusives aren’t available as part of their base free package.

Nintendo are doing this with their emulators being exclusive to Nintendo Online and new ROMs drip fed over a period of months.

Sony are doing this with their emulators being Playststion Plus.

Only Microsoft are pushing their online subscription as being hardware agnostics.