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Xbox repeats old mistakes, closing 4 studios including Tango Works

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Xbox seemingly learnt nothing from the previous 2 console generations. Based on their own Power On Xbox marketing video from 2021. The way they purchased, changed to suit the then current demands, and subsequently closed, is as relevant now as then. In that Public Relations video both Phil Spencer and Sarah Bond explain how they will learn from that:-

“We acquired Lionhead in 2006, shut it down in 2016. A couple years later, we reflected back on that experience. What did we learn, and how do we not repeat our same mistakes?”

Sarah Bond – Xbox 2021

That video could, and possibly will, be made in a few years from now and it would be as accurate. Yet again, the acquisitions and the growth of Xbox at all costs over the past 3 years has come at the detriment of Xbox as a business and Brand. While Microsoft has been buying up all the big publishers on behalf of the Xbox brand, they never focused on the short sighted nature of Game Pass or admitted what I have been saying for years, as it was a flawed plan from the get go. Game Pass is and never was sustainable, with it actively harming the revenue & growth of the Xbox brand and profits from day 1. 

 Much of the Xbox social media supporters viewed it from a single lens, My console, My games, No sharing and must beat PlayStation at all costs. This  immature view was perpetuated by the Xbox leadership at times and now all have themselves to blame. The most important thing when mistakes are made, as Microsoft have often done, is to learn and grow from them. Crocodile tears in Public Relations events, corporate evasive answers to questions never asked or worse still repeating them again and again are not the path to success.  The ball starting rolling with the Bethesda purchase as the industry consolidation grew it would only lead one way, and now that ball has now gathered immense speed. We will see more studios get consolidated or closed this year and if a company that can deliver highly praised and even awarded games in Arkane Austin and Tango Gameworks are not safe, then none are. Specifically, when in Hi-Fi Rush, a game that perfectly aligns and delivered on those Game Pass targets and went multi platform, still became collateral damage. The buck stops with all the management from Phil Spencer, Sarah Bond who have consistently demonstrated a high level of incompetence in business, planning and team management. However, be under no illusion Satya Nadella and the main Microsoft Shareholders are in control of this ship and have been since the Xbox Series X|S launched. Poor accounting, outsourcing of large projects, changing focus of teams to chase the market. All reflect on the consistent and repeated decisions and paths that Microsoft/Xbox have walked for many a year. A high drive for cross marketing with drinks, food and even shower gel have been at the heart of them aiming to subsidise the drive to make Game pass viable. This was then supplemented with a focus on buying success, and more importantly, IPs from within other successful studios, something of a Microsoft raison d’etre and this has come at the cost of those very same studios and teams. This is not how you manage a successful portfolio of game development houses as you forced them to create what you want and not allow them to create the very thing that made them successful in the first place.  Which, yet again, they knew as I quote Phil Spencer himself, the man in the driving seat, not the man in charge remember.

“You acquire a studio for what they’re great at now, and your job is to help them accelerate how they do what they do. Not them accelerate what you do!”

Phil Spencer – Xbox 2021

Which is exactly what they did and these cuts, and ones to come, are aimed at saving the bottom line and ensure the stakeholders get the growth they demand. On that score, Microsoft succeeded again with another bumper year of growth which came at the cost of keeping studios alive and teams creating. I discussed much of this in my previous gaming bubble video last month, I expect many more to drop away also over the next 12 months or so.More Lion heads will come as a direct result of the Game Pass focus that is not sustainable and will simply follow the same route of raising prices, adding more tiers and likely not even seeing large games such as Call Of Duty landing Day and Date as it reinforces the money loss approach it is as I and many others have said from day one. The issues are larger than just this though, they have a distinct lack of quality control such as the recent Fallout 4 Next Gen patch that only delivered on the PlayStation 5. Poor decisions in the Halo Infinite path or Forza Motorsport over promising and making false promises to its audience over and over again. Be that the Most Powerful console in Series X that failed spectacularly, again as I had stated ahead of launch alongside a lack of 1st party games of any caliber since .the generations started. The final word comes from their own numbers, Xbox have closed more studios in the past 12 months than they have released 1st party games. Sadly, failure now starts with an X.

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