Recently, foreign media Windows Central published an article saying that in order to save the decline of Xbox, Microsoft's new Xbox CEO Asha Sharma does not need to defeat external competitors such as PlayStation and Steam, but Microsoft itself is the biggest stumbling block restricting the development of Xbox.
After Microsoft acquired Activision Blizzard, it set a 30% profit margin assessment target for Xbox that is almost impossible for the industry to achieve in the long term. The radical profit strategy has had a devastating impact on the entire Xbox ecosystem. In order to chase short-term financial report data, Microsoft deliberately strictly controlled the production capacity of consoles. The market demand was strong but the supply was always in short supply. Even in the year of the release of "GTA6", it still faced the dilemma of having no goods to sell. Microsoft also raised the price of XGP subscriptions, but was eventually forced to adjust the price due to large-scale user unsubscriptions.
Xbox has considered a number of extreme cost-saving solutions, including cutting off backward compatibility for subsequent console generations and completely transforming into a pure software service model. In exchange for short-term gains, Microsoft allowed first-party masterpieces to land on Sony's competing platforms, further overdrawing the long-term value of the Xbox console ecosystem and forming a vicious cycle. The short-sighted pursuit of profit has also led to many chaos: the price of games has soared, the reputation of the customer service system has collapsed, and other decisions have been overturned one after another. As the AI industry continues to squeeze out memory production capacity, the window period for Xbox hardware to recover is being continuously compressed.
The external environment is also not optimistic. SteamOS has had a substantial impact on the Windows gaming field. Google has laid out the desktop Android system and gaming ecosystem. Apple and Google continue to squeeze Microsoft's mobile services. Sony and Nintendo also take the opportunity to consolidate their foundation. Under the pressure of layers of squeeze, Xbox is becoming increasingly passive.
Sharma, the new Xbox CEO, has taken pragmatic measures after taking office and has gained the expectations of many players, but the road ahead is still full of thorns. The game industry pays attention to long-term and multi-year layout, but Microsoft executives have always only focused on short-term quarterly profits. If you want to revive Xbox, you must not only face the impact of major external competing products, but also reverse the deep-rooted short-sighted business thinking within the company.