Microsoft execs "extremely committed" to Xbox amid spinoff rumors

New CEO Satya Nadella and Xbox boss Stephen Elop aren't likely to sell the Xbox division anytime soon, according to Phil Spencer.

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Rumors have swirled for months now that Microsoft might sell off its Xbox division, but it does not look like that's going to happen anytime soon. Microsoft Studios executive Phil Spencer said this weekend at SXSW that Microsoft's new CEO Satya Nadella and recently appointed Xbox division boss Stephen Elop are "extremely committed" to the Xbox brand going forward.

"In terms of Microsoft's commitment in the [gaming] space, I know both Satya and Stephen Elop, I know them well. I've had explicit conversations with them about Microsoft's commitment to Xbox--they're extremely committed to Xbox," Spencer said (via Polygon).

Elop was reportedly planning to consider selling off the Xbox brand if he was appointed CEO of Microsoft.

Spencer said Xbox represents a "critical" brand for Microsoft as a company, going on to say that Xbox is "one of the most beloved brands" in Microsoft's portfolio. It's an especially important time to have the backing of your parent company, considering the company's ongoing battle against Sony and the PlayStation 4 for the living room.

"We're in the middle of a good, competitive battle in the console space with PlayStation, which is great for the industry," Spencer said. "And they remain extremely committed to us succeeding with Xbox, which is nice to hear, right? It's something that resonates well inside the walls when you're talking to the teams, or when I stand in front of Xbox fans, I want to make sure that they understand we are extremely committed to this product."

Microsoft's Xbox One has some catching up to do to match the sales pace of the PS4. Sony's console has sold over 6 million units to date, while the Xbox One moved 3 million consoles in 2013. Microsoft has not provided a new sales update in the New Year.

Eddie Makuch is a news editor at GameSpot, and you can follow him on Twitter @EddieMakuch
Got a news tip or want to contact us directly? Email news@gamespot.com

Discussion

144 comments
straightcur
straightcur

Of course they would say that.  What else are they going to say....    Even if it does happen (which I have no idea either way), they will deny until the end to keep the sale price up. 

Daemoroth
Daemoroth

I'm still worried, Elop has been very open about his desire to sell the Xbox division. And if you look at his previous jobs, Boston Chicken bankrupt in 98, Macromedia sold off to Adobe 3 months after he became CEO, and there's his tenure at Nokia where revenue fell by 40% (And income by 92%) and sold off the mobile division to MS.

Seems like this position is his "reward" from MS for driving Nokia into the ground then selling it to MS.

So yeah, still worried.

blue_shift_91
blue_shift_91

no shit. of course they're committed. the xbox is probably one of the few pieces of Microsoft hardware that casual-gaming Apple & Android fanatics will consider buying. and that means big potential for the ecosystem.

Vodoo
Vodoo

If you're so committed to the Xbox brand than hire me to run it.

I would completely scrap the XB1 in its current state and release an updated model, a model people would buy. It would be slightly more powerful than the PS4 so game devs wouldn't have to compromise between features or functionality for their games.

I would also issue everyone that already bought the XB1 a new machine for free. Replacing a few million boxes, and having a great selling product thereafter would be cheaper than 10yrs of dwindling sales on an already outdated machine.

I would ditch Kinect entirely, but build the voice commands directly into the system UI (because they are handy to have, but gestures just suck). I don't know why the hell MS pursued Kinect 2.0 when nobody liked the first one, nobody asked for it and nobody sure as hell wanted it. Misleading the public by making it seem that the tech worked better than it does and was more capable than it really is was wrong. That's not how you get customers, it's how you lose them.

I would support both physical and digital games, for those that want it. Digital games would be $10 cheaper at launch than their physical counterparts. The Family Sharing program for digital wares would be enabled like was originally intended. Just because Microsoft supported physical discs doesn't mean they couldn't also support the only positive aspect of their anti-consumer drm. They did the equivalent of a little kid taking his ball and going home because he didn't get his way.

Xbox Live would also be revamped to give back more to loyal subscribers. The longer you're a paying customer, the better benefits you get. I would also remove the paywall for other subscription based services, like Netflix. You don't charge people twice just because they're getting access through your device.

Nothing to complicated here but it continues to elude Microsoft. It's better if they right the ship now before it's too late. So there ya go, Microsoft. An A, B, C guide to have a successful console that I would happily implement for a nominal fee.

bourne714
bourne714

Well, I'm somewhat relieved to hear that they are addressing concerns.  Cause i'm going to be honest.  Despite all that's going on in the console war between Xbox and PlayStation, I still somewhat hold Xbox close to my heart and would really like to see it succeed.  Selling roughly 4 million consoles already in the 3-4 months is definitely an indication that it is extremely relevant.  It's nice to hear that the are committed.  Time will tell if they are telling the truth though.  Cause I sure would be disappointed if I didn't get to jam out on some next gen Gears of War and Halo. 

Thanatos2k
Thanatos2k

I've said it once and I'll say it again - it makes no sense for Microsoft to own the Xbox.


Microsoft is a software company that sells OPERATING SYSTEMS FOR PCS, as well as many enterprise software suites for the PC.  That's where they make their money.  The Xbox division didn't even make any money for years and doesn't even compare to their other revenues.


For years, the defining feature of the Microsoft Windows Operating system was the massive library and support for games.  It's one of the main reasons Windows achieved a monopoly in the PC space while Apple withered.  It is in Microsoft's best interests for a Windows PC to be the only gaming device you need, as this will keep their market share of operating systems up.


The Xbox directly competes with PC gaming.  The Xbox directly competes WITH MICROSOFT.  The Xbox is one of the primary reasons that Windows PC market share is now falling.  They are doing serious long term damage to their entire brand by continuing to run the Xbox.


Why?  What is the point?  They should be selling the entire Xbox division for the good of their company.

WelBluVid
WelBluVid

I'll say one thing that TitanFall gameplay is looking SICK!!!!!!

ggregd
ggregd

Real World 101:   If it's true they're going to do everything in their power, including lie, to quash rumors.  These rumors create uncertainty, which lowers sales.  Lowered sales would not only mean less income, it would mean the XBox brand is less valuable and they would get less selling it off.  If a month from now they announce a spinoff or sale, this would hardly be the first time executives or PR people made misleading or flat untrue statements.

Zero_Nitrous
Zero_Nitrous

The more I look at XBOX One I keep thinking, Jaguar, Virtual Boy, 32X.  I don't know why.

tigress666
tigress666

Unfortunately for them that won't quell the rumors... they would say that whether they were thinking about it or not (it would not be good for the system for people to think they are going to sell it and until they actually do, they're not going to sabatoge it like that. I mean even if they were going to sell it, they would want it to have a good mindshare/marketshare to keep the worth up for the buyer).


That being said, it's also very true they may very well be speaking the truth. In the end, we're not going to know until it doesn't happen or does ;). Or if we end up working for the buying and selling company in a part that is relevant to the buying or selling (I doubt even if they were considering selling they would be telling employees that don't need to know).

SabanSilverHawk
SabanSilverHawk

Why the hell would they even consider selling it? Just another PR move to get them more attention

northArrow
northArrow

I doubt the Xbox line is in danger of being sold - only because their phone and tablets are bigger flops. The Xbox is still doing okay, even if they're going to lose market share this gen. If their other devices were selling well, Microsoft would no doubt cut their losses and move on.

Heshertonfist
Heshertonfist

"Xbox is "one of the most beloved brands" in Microsoft's portfolio."


As far as I know, it's the only one people like. Who the **** uses a Zune anyway? Also, wtf is a Zune?

Hurvl
Hurvl

I'd be extremely surprised if they decided to sell it off, especially this close after the launch. They haven't been able to sell many games yet or get much money from Xbox Live Gold subscriptions, so all of that R&D money and costs with the hardware would have been wasted. I don't know if this Xbox is the last they'll make, but their ambitions with it are quite large and why sell it off to someone who might not follow in MS's tracks.

de-astroturfer
de-astroturfer

"extremely committed" to the Xbox brand going forward." well of course he's going to say that but saying "extremely committed" isn't the same as saying never !

ncogneegro
ncogneegro

It may seem like a stupid decision from a customer stand point but if you step back and look at it, you will see it makes a lot of sense.

The Console Gaming Market:  Since Atari first started the console market back in the late 70's early 80's many consoles have come and gone.  The one thing they all had in common was that they where hardware based platforms that earned their money through the sale of software.   I can think of only 4 consoles that EVER built a successful model around the sale of hardware.  SNES, Playstation 2, are the only two I can really say actually succeeded.  Where the sale of the consoles themselves where factored into quarterly earnings as revenue generating.  Microsoft will make consoles, and invest billions in research and development of the hardware.  Then the production of the hardware, distribution, marketing, technical support.  All of this is done AT A LOSS.  They do not expect to make any money off of the console hardware sales.  The only way for a console to make money, is by SOFTWARE SALES.  Look at the Top 10 best selling games.  That list is dominated by MULTI-PLATFORM games. 


CoD 3, sold 20 million copies, but 20 million people didn't buy it for the Xbox 360.  It was shared amongst multiple platforms.  


Controle the Hardware, or Control the Software:  Microsoft attained their company lofty goals by ignoring hardware and instead created a virtual monopoly by selling and making their operating systems the industry standard.  With the Xbox MS controls the hardware, and since most use Windows to code, they have ties to the software.  But as we are seeing now, hardware of the consoles are becoming more in line with each other. The last truly innovative console architecture was the PS3.  And developers didn't want to code on that thing.  Not only that, if you look at developing trends you will see hardware will become less and less important to games.  With the continuous spread of broadband, both wired and wireless, a consistently connected environment is not unforseeable.  Playstation Now is generating a lot of buzz as well.  

If you controlled the largest most successful software company in history.  The ONE company that everyone has in some form or function use of their product (even Apple uses Windows based servers), Why gamble with trends.  Xbox One was designed around providing services, and making it truly multi functional.  Can you see the Xbox One selling as many as the Xbox 360?  Corporations like MS work through quarterly projections how many quarters till the Xbox One evens out?  If I was running Microsoft I would take a long look this.  Especially since you know that in 10 years who has what console will be as irrelevant as different PC's on the market.

TristanPR77
TristanPR77

Do people really believe Microsoft is going to publicly accept they are considering selling the xbone division and cause a panic with their customers?

Of course not, they will say everything is good. Not only Microsoft, any company.

jsmoke03
jsmoke03

i dont know why everyone is on panicking at ms. they are selling pretty good for $100 more expensive console

Subterfuge71
Subterfuge71

I've been an Xbox gamer for over 10 years, but Microsoft are getting no more of my money. After the clusterfuck that was the Xbox One announcement, and all the subsequent about-turns, I have lost all faith in them, and respect for them. I just don't trust them anymore.

kovaras1984
kovaras1984

Funny how this has become a story as tho MS themself have given no reason for people to think that they may sell it off lol, shows the power of internet roomers and speculation


Yet Sony who are in a desperate financial situation yet no mention until they sell their tokyo HQ and the story title is sony sell off HQ but there will be no impact to gamers lol 

Daemoroth
Daemoroth

@Vodoo Don't worry about cheaper digital games, retailers will throw a fit and pull all your games off their shelves - they still have too much power in that department, maybe later that move can be made, but not just yet.

And just match the PS4 hardware, throw out the ESRAM, shove in GDDR5 and send me my replacement! :)

Also, challenge PS+ Instant Game Collection by continuing to offer older games that players get to keep with or without subs, while adding more recent titles with a sub requirement.

On the other hand, maybe developers (And game engines) need to be advanced to take full advantage of ESRAM and push out 1080p resolutions. Right now it's new, and a lot of games are multi-generation. We haven't seen what a dedicated next-gen engine can really do when developed from the ground up with some knowledge and experience with the hardware.

That said, I will be waiting for my replacement XB1 with no complaints. :P

imm_84
imm_84

@Vodoo  Its wrong to sell digital for cheaper business wise. The reason is it will slow retail sales. Retail is considered one of the major factors for game awareness to publishers. As a business you want all the retailers to hold your products.  I agree on most of your points .. Regarding the less powerful system .. I think Its a development issue Its the first year and the plan is for it to hold up for another 10 years. I remember the first games on 360 they seems no different than the original xbox a few years latter things improved. 

omar_q
omar_q

@Thanatos2k MS isn't all about operating systems anymore champ. They're transitioning to a more service oriented company, providing tablets and phones, as well as obviously their biggest success (in terms of hardware) the Xbox.

neowarrior121
neowarrior121

@Thanatos2k  sadly even the pc operating system side is being cut down thanks to apple and people buying there machines and valves operating system that is better for gaming. still they make the money off operating systems being on every new machine but its not like back when they had no contenders at all. 

_Silent_Jay_
_Silent_Jay_

@ggregd Real life 101:  When an employee mouths off about a division, and then is assigned to the division, it means that they believe more in the division than the employee.  This was MS saying, "Sell it off, huh?  Well, how about you work there, jackass?"

northArrow
northArrow

@jsmoke03 It's doing better than the WiiU, but they're getting hammered by the PS4. While I have no doubt the Xbox line will be okay and still make the company money, at the end of this generation Microsoft will have lost market share in the industry. The 360 sold more than 80 million units, it's highly unlikely that the Xbox One will even get close to that milestone. I think stock holders in Microsoft are looking at the investment cost of the console vs. their return and it's not adding up to big enough cash flows. 

MichaelJolly
MichaelJolly

@jsmoke03  The problem is that sales completely dropped off after their initial release. What this means is you had a whole lot of Microsoft loyalists buying the console immediately, but the average consumer isn't biting. And it isn't a problem with the supply, as the One can be found almost anywhere in decent numbers. It's simply a case of the hardcore Xbox fan got theirs and the rest of the market is luke warm on it.


Contrast this with their only seriously console competitor at the moment who sells out every shipment pretty much immediately and have already surpassed them by over 2 million sales. That's simply not a good place to be. 

WelBluVid
WelBluVid

@Subterfuge71 Putting trust in a Large Corporation was putting your trust in the wrong place in the first place. Truly, you got your money's worth. Everyone even Sony fanboys/girls know MS will iron out the kinks! They troll all the post cuz they know it's just a matter of time. IF Sony can make a comeback after 12+yrs w/the PS4 which just happens to be up & it's been less than 6mths who can't? 


This isn't a 1, 2, or 3yr race there is plenty of time to make GAINS...

kovaras1984
kovaras1984

@Subterfuge71 good argument against them, you didnt like Microsofts original policies at launch but when the listened to people and changed them to what people wanted  you dislike them for that also lol, after reading this post ive lost my respect for you and no long want you on xbox live, please stay away your not wanted

tjkraz
tjkraz

@MichaelJolly @jsmoke03  Xbox One is in a better place than PS3 in 2007.  


It's going to take more than 4 months to dissect any consumer trends.  $400-500 gaming consoles aren't an easy sell.  Especially when neither of them has a "killer app", their operating systems are still a work-in-progress and the systems haven't launched in many countries.  


Check back in about 2 years...after consoles have been fine-tuned, multiple exclusive game titles are released, prices are adjusted, consumer awareness grows, etc.  

tigress666
tigress666

@kovaras1984 I wouldn't trust them because MS was being MS when they made those announcements (It's typical MS). It's not like those policies were not very much something that is unsurprising MS would want to do (after all, it's understandable they thought they could get away with it when people totally didn't mind that they locked away stuff like Netflix and internet access behind a paywall. Hell, they tried to co erce people into the subscription model of Office by saying if you bought it you could only install it on one computer). It's very typical of MS to try to do things they know consumers won't like but think they can get consumers to put up with and only backtrack when it's proven it won't work (don't think MS listened. If MS listened, they never would have announced those policies cause they absolutely knew people hated those policies. What they didn't know is that people this time put their money where their mouth was. Only when MS realized they would have a complete failure did they 180, it wasn't cause they cared that people disliked it. Don't tell me they had no clue people were upset about the idea when people had been raging about it on the internet for months beforehand. And MS is in the business of tech and the internet so I'm sure they were well aware of the uproar about their policies. I mean they fired Orth for firing people up more about it).


So... yeah, they 180'd. Only cause they had to. And it's not like they haven't shown precedence for trying to force unpopular policies on people as long as people "deal with it". It's very typical MS. So, yes, there is a good reason to not trust them.

Subterfuge71
Subterfuge71

@kovaras1984 Which part of "I don't trust them anymore," did you not understand? They may have panicked and back-tracked with their original non-consumer-friendly policies, but they are not to be trusted anymore. They don't care about their customers, they only care about controlling every single aspect related to gaming, and bleeding every penny possible from their customers. Sure, Sony wants to make as much money as possible as well, but they haven't done anything that makes me want to avoid buying their console.

dnmt
dnmt

@kovaras1984  The fact they were going to go through with it if not for the huge amount of backlash is enough. You know, like someone is planning a murder but then he gets caught beforehand? He still has intent to kill.

Subterfuge71
Subterfuge71

@WelBluVid Yeah, I get what you're saying. I used to trust them to deliver a gamer/consumer friendly console, but not 'fanboy' trust, just a low level trust. All big corporations are evil money grabbing bastards at a grass roots level, but Micro$oft have alienated many of their core consumers with their evil ways. If Sony show real signs of going down the road that Microsoft tried to go down, my opinion of them will drop very quickly, but so far, they have been doing things right, and when I do finally go next-gen, I'll be doing it with a PS4.

WelBluVid
WelBluVid

@Subterfuge71 @kovaras1984Dude I agree w/you that's why I say don't trust them in the first place. They're a company that has to make money to prosper. Stick w/em if they have what you want or need, but other than that keep stepping. 


I'm all for MS for now when it comes to gaming for the simple fact I like the games on Xbox better than Sony, but I don't trust them. lol Well, I trust them enough to put out a decent product.

rasterror
rasterror

@dnmt @kovaras1984 It's funny how MS got backlash for their DRM policies but nobody batted an eye when Sony was about to do the same thing.

WelBluVid
WelBluVid

@dnmt @WelBluVid@MichaelJolly@kovaras1984The proof is in the future, how else do you answer my question that I answered? How do you police piracy? Piracy can be illegal downloads, modded consoles etc How do you stop all those losses that both companies experience? I say along w/the rest of the planet DRM policies what's your answer?

spartanx169x
spartanx169x

@MichaelJolly @kovaras1984@dnmtThe evidence is that sony would never state their policies until MS did theirs. Sony used it as play. good business strategy. And going forward almost all games are going to be online only by the Developer so it won't matter . Just Like Destiny-Online Only. No need for the console to be that way when the game is designed that way . .

dnmt
dnmt

@WelBluVid @MichaelJolly @kovaras1984 @dnmt  So basically you don't have any solid proof that Sony was planning to do the same thing but you're gonna go ahead and lump them in with MS anyhow. Good to know.

WelBluVid
WelBluVid

@dnmt @kovaras1984They're not saying you'd have to stay logged in 24/7 they're speaking of DRM policies, which you have anytime you purchase anything on the net i.e. digital downloads... If everyone doesn't have the same DRM policies how do you explain the planet moving towards the WWW & policing it? DRM is how...


The future is DRM, we're not laying all the fiber-optic cable for nothing, we want high speed even in the mountains & who on the planet is not trying to keep up w/China & Japan which have blazing speeds everywhere? No more going to the stores when you can have everything directed to you. Cut out the middle man (wal-mart, best buy, target etc)

WelBluVid
WelBluVid

@MichaelJolly @kovaras1984@dnmtDude everyone on the freaking planet has the same DRM policies.... How else do you protect products from internet piracy? Everything will be like this thx to the internet killing everything.

Keep in mind Sony announced the next Gen 1st w/o showcasing anything, got MS to jump the gun by showcasing the future of internet anything (DRM piracy prevention) & saw that a large percentage didn't like it so acted as if they weren't headed in the same direction.

dnmt
dnmt

@kovaras1984 @dnmt  Show me a source confirming that Sony had similar plans to MS. I'll bet you can't even though it's a moot point seeing how they never went public with them.

MichaelJolly
MichaelJolly

@juboner @MichaelJolly @kovaras1984 @dnmt  It also would have been impossible to do since Sony said from the very beginning you would never have to connect your console online to place your games. unless of course they planned to force you to register via phone and called you every week to read a serial number off to them.

MichaelJolly
MichaelJolly

@kovaras1984 @dnmt  Why do people keep saying Sony had the same policies. There is absolutely no evidence of that at all. 

kovaras1984
kovaras1984

@dnmt @kovaras1984Yes because that is exactly the same LoL could not have made a wilder more unreasonable comparison, and if thats your thinking Sony have the same DRM policies which was so unpopular... they just kept quiet about it and changed them in an updated psn user agreement yet sony revived no backlash for it, funny eh?