Game Pass will HAVE to do more to reach people outside of the existing main customer base on console. Sharma seems aware of this as well. It honestly sucks how much pushback there was against the, “This is an Xbox.” In a more perfect world gamers could’ve responded, “Oh cool. I can show this to my XYZ who doesn’t own a console but sometimes wants to play games with me. Maybe we’ll try it out.” Though it’s also on Xbox for not having essential (an actual cheap option) available until 2025 and they even started getting stingy with trial periods.
Phil constantly spoke about reaching the literal billions of gamers out there on mobile, but marketing never really reached them. The general public still has such poor awareness of consoles in general. Talking to non-gamer friends and family is such an interesting experience. They don’t know so much and don’t care about any of it. There’s a mindscape chasm Xbox will have to overcome.
It’s the lame duck COD year that started, idk when, but can also be seen with Modern Warfare 3. The back to back sequel doesn’t work at all and gets called out as feeling like a rushed mess that should’ve just been dlc for the last game. Activision has already responded to this, so hopefully it won’t happen again.
We will no longer do back-to-back releases of Modern Warfare or Black Ops games. The reasons are many, but the main one is to ensure we provide an absolutely unique experience each and every year.
We will drive innovation that is meaningful, not incremental. While we aren’t sharing those plans today, we look forward to doing so when the time is right.
But from now on gaming revenue will be heavily tied to COD’s performance. That’s the catch 42. A year like Black Ops 6 which was one of, if not the, biggest COD launches ever and saw phenomenal reviews and praise drives an increase for the quarter and a lackluster Black Ops 7 drives a decrease year over year.
Phil did but the problem with cloud I think is scaling, it also requires a lot of series console blades. I doubt they have enough to reach a hundred million. This makes it difficult to advertise cloud gaming when you can’t satisfy the demand it could bring. It’s also a reason they had to focus on PC. Console growth meant they had to sell you an expensive console to bring you in on Gamepass. There was also the Mobile store issue which could have allowed them to bring their games with much ease to mobile probably also natively for many of them. That would have helped a lot reaching out to many. I do think there was even a time that Sara Bond sort of paused at the idea of going multiplatform in an interview and was more that the push was for mobile. It seemed odd at the time. It came off as if she was saying the 4 games were it and she was against going multiplat but was setting up the mobile store to be the answer which didn’t materialize. If the store comes into focus now you will see people blaming her and praising Asha again on getting it done.
That will be crazy COD is big, but I don’t think relying on it is the answer. To me I think growing Gamepass is the answer for them. It already generates more revenue than their game sales and about the same or more than Sony’s. Gamepass also doesn’t need and isn’t subject to new gen resets or restarts. Asha’s shift back to console is in my opinion also due to Gamepass members probably moving to other platforms and them wanting to stabilize it on consoles for maximum profit. They have talked about aiming to reach 100 million subs which will generate over 15 billion dollars at the least and may go as high as 24 billion dollars, there is nothing else in gaming that could drive that kind of revenue other than microtransactions which if it did would be very aggressive and likely very nickel and diming the audience.
My guess is Asha would try to boost the current consoles with features and try to remedy the issues surrounding series S as much as possible. She’ll probably be looking to get the console subs to maybe between 50-70 million and using that to push the Xbox platform everywhere.
No I mean this is the catch 42 with them buying ABK period. COD is just so massive and Activision turned it into their huge money making machine. Year over year growth becomes dependent on COD’s performance. Xbox will have to figure out what they want to do with that. It’s probably also a reason Activision was fine with selling because they kinda peaked because of COD. They tied their entire growth to COD. If COD was bad the entire business looked bad and it negatively impacted stock. Or vice versa.
I think Xbox did want to convert as many COD gamers as they could to Game Pass which would create a more stable source of revenue and get those COD gamers engaged in the Xbox ecosystem beyond COD (we know there’s plenty of Xbox gamers who only play COD or the sports games or fortnite). Overall it’d be a much much more sustainable wider net. We now know that didn’t happen though, so it’s kinda just a wait and see for Xbox’s next move for what they decide to do with COD. Like in a perfect world they’d have turned every single COD player on Xbox & PC to convert to a Game Pass Ultimate subscriber paying more in a year than they would on one COD and still buying Microtransactions and branching out into other games. In an even better world some PS gamers would hop onto a series S for that and there’d be some brand new casuals playing COD through cloud. That didn’t happen and largely the COD machine seems unaffected. Xbox has the difficult job of changing gamers habits otherwise they’ll be stuck in the same trap Activision was in.
I get the marketing but like I have written before, they needed to make sure the consoles were front and center for them(which I get why it wasn’t, Microsoft had forced them to pretty much stop making enough to sell consistently). Like instead of just showing someone using a phone or tv and saying this is an Xbox, start with showing someone playing a game on their Series Console. Needing to go and picking up the game on their phone on their commute, just a way to communicate the seamless way it could work.
The second thing they need to do was communicate Game Pass in those commercials, because Game Pass is Xcloud, and the streaming service just doesn’t work without it.
My point is you we haven’t seen a massive surge in Game Pass subs & you need GamePass sub to use Xbox Cloud Gaming. So I feel Azure is where the bigger growth is & plenty of games use Azure Cloud like SEGA’s PSO2
I agree with the growth of PC users subscribed to Game Pass, amazing given PC users always say they don’t like to subs & most things Xbox haven’t been advertised properly, it’s depressing & has been the case for decades now
Last Year’s COD had its Battlefield 2042 moment & like that game wasn’t very good. The big issue for me with COD games is that they’re being made by different studios, each given 3 years to make a new one & that can mean a big difference in quality
I would rather have IW make all the COD games, with Raven allowed to make new games or even sequels to Quake 4, Hexxen, or Singularity. I’ve never enjoyed a Treyarch COD game & that goes back to COD 3 on the 360.
If the target audience are the many many millions that aren’t ever going to pick up a console and are rather turned off by consoles than I get why they didn’t push them as much in the campaign (in addition to not being able to sell them). Pushing the console in an ad campaign targeting people that never even considered buying a console might please existing customers but turn away the new customers they want. It’s what feels like the hardest part here. Certain Xbox and non Xbox console gamers were up in arms as soon as cloud gaming was announced. It’s hard to grow the audience in new markets when the existing audience treats everything that’s not for them or different from the past as an attack and go into defensive mode.
Game Pass was an issue. It still is. When they first started the campaign only ultimate had cloud gaming still and it was still on beta. That was also when ultimate cost $20. It wasn’t until late last year that cloud gaming went to all tiers including the $10 essential, but that was also when Ultimate (formerly what you needed for cloud gaming) went to $30. If someone actually picked up Xbox Cloud Gaming from the campaign they’d have gotten ultimate which even at $20 cost too much for ONLY cloud gaming, and then if they had ultimate they’d need to downgrade to essential or premium (both of which are less than the initial $20 price so that’s good) or pay a whooping $10 more. But if they did downgrade they’d go from a massive library to a much smaller one. Essential really only works for that very small library + buying your own games which is a whole different model. It was very bad on Xbox’s part to not have gamepass and cloud gaming as a business model figured out. They still need something a little cheaper to start if they really want to reach casuals and non gamers with Cloud Gaming as a solitary option. Essential is good for that, but not the best. Most people are used to the idea of just subscribing, not subscribing and still buying games. I think for that model they should try to get it a little cheaper. Like Nvidia GFN is technically free to start streaming the games you own (just with a lot of limitations). Maybe that’s where the free or reduced with ads comes in.
It’s not a bad sentiment, but it’d be hard to convince financially. COD is such a massive seller each year, even when the game underpeforms for COD it massively overperforms for gaming in general. Even when people don’t like it as much and criticize it, it still does massively well. It’d be amazing for the studios to get freed up and have the freedom to work on something other than COD again, but the COD machine exists because of how much money it brings in consistently. None of those other games would remotely come close in sales leading to a far bigger drop off in YOY revenue. And because Microsoft is a public stock company what matters for investors is consistent YOY growth. Xbox just needs to figure out what to do with COD. They realistically can’t take away a huge yearly source of revenue unless they have something else to supplement that with.
It’s been the case sense always. Microsoft struggles with advertising their consumer business. I will say Xbox has taken not of that and you can see their marketing consistently improve since like 2019. A lot of that is on Phil and Sarah. They made a lot of great decisions with building up Xbox’s showcases, hiring the right people, making partnerships, and so on. 2026 isn’t even half way over yet and we’ve already had the dev direct, partner preview, ID@Xbox, Xbox First Look Metro, and (will) have Xbox Presents Stranger than Heaven all before the massive June Showcase. Sharma’s background is in marketing, so hopefully she can continue to improve in this area.
Those people aren’t going to pay £60 to £70 per game on a mobile IMO. They’re more than happy with GAAS or TikTok & they’re not going to pay £30 a month to cloud game either
GamePass subs seem to be in the 30 to 35 million subscribers mark, so it’s not reflecting the growth seen with Microsoft Cloud, so thats why I think most of the growth with Cloud is on the Azure side not that I don’t doubt Xbox Cloud gaming is growing.
It’s sad because the Series S should have been the perfect entry console for kids, but most seem to go for the more expensive PS5 or Switch 2
I like Phil & will always been thankful for what he’s done, it just seemed the ABK deal really took it out of him & was hurt personally with the studios closers & layoff’s after the deal
Maybe it’s time Xbox looked to ask for more money & resources for its PR dept because its very embarrassing that a trillion dollar company as such weak & lacking PR in the gaming sector
I agree this year will be great and our new Boss is making all the right moves & saying what fans want to here. Its been a lovely few months with massive renewed optimism on my part
I agree. Abandoning hardware, neglecting hardware, stopped trying to sell consoles, abandoned the base, pissed off the core, etc. I don’t understand any of this sentiment and I follow this stuff pretty close. In my eyes, an awesome console came out, tons of great games over the years, hardware sales hit a peak then drop and the back end of a generation (made worse by hw prices). Why does xbox trying to grow pc/cloud/handheld market share translate into abandoning hardware and console? To me this is a classic turn vibes into facts situation.
I am further confused seeing that the solution to the above was to refresh a logo, put a box around our 1000/1000 gamer scores, and pull cod out of gamepass. Now everything is better.
All that said, I don’t want to be a party pooper. I’m thrilled there is some excitement around the brand and new management with new ideas happening. I’m more than happy to ride this wave with everyone. It is fun. I just never understood the sentiment around the console pitty party.
IW for me have always made the best COD games & I just would like to see them given the task of making each new game or them & Sledgehammer to make each new one
COD is getting so much like Assassins Creed from Ubisoft or Like a Dragon from SEGA. I’m getting bored with the yearly updates. Raven are so wasted on COD they’re a brilliant studio that should be doing different games.
I was playing Hexxen and Singularity the other day and both are so good, even now. Singularity needs a remake or the Nightdive studio remaster treatment
What’s more surprising is that they are expecting Xbox Content & Services to go down over 10% next quarter too, while having FH6, it’s not like Q4 2025 had any big game release, maybe the GP cut will hurt until more ppl subscribes back.
MS/Xbox is in a weird position, lots of talk and some hype about their next console, but nobody can really see how are they going to make big money from it, all we know is it’ll support Steam, but having a big store is everything nowadays, and who’s going to use their store over Valve’s? Not many.
Pay to Play online is a huge profit maker for console manufacturers but i doubt MS can charge for that anymore either. The entry price for their machine knowing this is hard to guess.
Lots of questions about the paths they’ll take for their next-gen, it’s going to be interesting at least
This I agree with. Xbox needs to figure out the business model they actually want to go with. Stadia had the same issue. I think you’re misreading the cloud gaming vs Azure though. It would literally be illegal for Satya to be talking about gaming monthly active users and citing growth in game pass subscribers on PC and Cloud and for that to actually be reffering to third party games using Azure service. Azure is growing a lot. Heck that’s been Microsoft’s been cheese for years now and Satya’s big W. Azure doesn’t translate to engagement on cloud gaming and hours if Satya Nadella says this:
During the Q2 Webcast, the only Xbox/Gaming-related statement from Satya was that Microsoft saw “record PC players and streaming hours on Xbox.”
Then he’s not talking about Azure. Azure isn’t even under the “more personal computing” section gaming is. Growth in Azure due to B2B partnerships with other gaming companies would be tracked under Microsoft Cloud or intelligent cloud. It wouldn’t come up with gaming or more personal computing. Growth in Microsoft Cloud or Azure is growth in Microsoft Cloud/Azure and growth in Xbox Cloud Gaming is growth in Xbox Cloud Gaming.
Market share is fixed and people are just going with what they had gone with in the past. PS and Nintendo aren’t seeing a significant number of brand NEW gamers either. It is sad. The Series S would’ve been the industry’s best chance of introducing new audiences to native console gaming, but the industry also decided to hate the series S. And on a wider level console gaming has just become too niche. I’m not sure how they can change that at this point.
Like I said Xbox has already been consistently improving this since like 2019. Phil himself did say that he underestimated how involved the regulatory process for ABK would be, but also 2023 was the year of the first January Dev Direct. Xbox currently has a stronger presence than ever and a solid consistent rotating batch of showcases, directs, and exclusive previews. They also have good presence at gaming events, are doing more collabs, and pushing the brand. I’d say they need more ads both physical and digital and ads that focus on communicating the value of the Xbox ecosystem, but they also started doing that better with Xbox Cloud & Xbox PC labels as well as stickers for “Xbox Play Anywhere” and “Day One Xbox Game Pass” on game trailers. I’ve also continued to see this messaging even outside Xbox channels so that’s great. Marketing does need to get better, but it’s also already getting better. It’s far from embarrassing at this point. Xbox consistently has gotten voted the best showcase. It’s just also not the best it can be.
It’s so frustrating and even more so when you remember how much gamers love the blatantly anti-consumer and constantly nickel & diming tactics of Nintendo and Sony. I’m glad that Sharma has stated she’ll continue pushing in cloud, PC, and even mobile. That’s what I do find hilarious. Sharma has explicitly stated Xbox’s growth strategies will continue on PC and Cloud in the “we are Xbox” and people are applauding. People can call it a messaging issue, but I kinda just feel like they got one pulled over them. I’m just happy as long as Xbox keeps doing the things that make me glad to choose Xbox as my preferred place to play like Xbox Play Anywhere.