PS4 and Xbox One Sales Defy "Death of Consoles" Rhetoric, Says Xbox Boss

Phil Spencer: "Four years ago when I was sitting doing these interviews, the question was 'do people need consoles?'"

283 Comments

The surge in popularity of both the Xbox One and PlayStation 4 shows the console business is still viable, according to the man in charge of Microsoft's games division.

Phil Spencer was promoted to head of Xbox in March 2014
Phil Spencer was promoted to head of Xbox in March 2014

In an interview with Edge, Xbox head Phil Spencer spoke of previous years when he faced questions from journalists regarding the supposed poor health of the dedicated console business. Such questions were put to him as respected executives in games, such as former Square Enix boss Yoichi Wada, claimed consoles were heading for extinction.

"I have a lot of respect for the team at Sony and the success they’ve had with PS4, and it’s a great time for the console industry," Spencer said.

"I’ve said this a few times, but four years ago when I was sitting doing these interviews it was, 'do people need consoles any more?' and, 'isn’t this just dead? Everybody’s playing on their phone.' And now you’re looking at the PS4 having sold over--I don’t remember their last number-- but over 20 million.

"And we’ve sold a ton of Xbox Ones globally, more than we’ve sold 360s [in the same period]. We’re both doing really well, and I think Nintendo has a plan for the future--I don’t know what the NX is, but it’s great just to see the business being done."

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When it comes to the overall viability of the console games business, hardware sales are one part of a far bigger equation.

Questions remain over whether games consoles are profitable for Microsoft and Sony (the original Xbox, for example, lost Microsoft billions overall). Meanwhile, developers and publishers face a steeper challenge than ever to yield profit on triple-A games.

Elsewhere in the interview, Spencer accepts that Microsoft needs to strengthen Xbox One's market position across Europe. According to Sony's most recent estimates, the PS4 enjoys a 70-90 percent market share across the continent.

"We need to do better in Europe. When I look globally, mainland Europe is definitely an area we want to focus on. I’m excited about going to Gamescom at the beginning of August, having another press show where we’re able to show games that we didn’t show here."

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Avatar image for edviges
edviges

The man is right. Console gaming equals quality gaming! Quality gaming on mobile means IAP.

Avatar image for hvd2222
hvd2222

pc is falling behind.the pc revenue is 80% e-sports.people spending money on cases in cs go,buying cards in hearthstone,skins in league,THATS the pc revenue thats it making.look at AAA title sales its all consoles and hand held.30,000,000+ have ps4 and xbox one.if anything consoles are booming right now selling way more then last gen.and pc gaming is making money off of cash shops thats what pc gaming is now or days.e-sports and cash shops.

Avatar image for Edrees22
Edrees22

The cell phone gaming market is very fickle. It's similar to how the Wii had an explosion of users. People like new things. Cell phone games will become less and less of a fad (and they are), and the market won't be willing to pay for them. Video game console users are proven to be buying video games for all their lives. Cell phone market seems more booming when you look at 2-3 years, but over 15-20 years, the consoles are going to be more stable.

Avatar image for konchu
konchu

Unless PC can be made a seam less experience I don't see it succeeding destroying the console market. But is not impossible. I do see the apples and androids eventually putting some hurt on though. We are at somewhere between xbox/ps2 level graphics pushing into the ps3/360 Territory on games now. So I don't think it will be long where we have killer games on that tiny dvi dongle on our tvs. Internet is not quite there yet but streaming could kill the dedicated box in the future. Maybe the future is xbox and ps consoles being tiny little dongles powered by the same chips we have in our tablets and phones.

Avatar image for corwynnm
CorwynnM

Yeah, man, why would I want to game on a console when I could be looking at my 5" phone?

O.o

Avatar image for Stonedwolfed
Stonedwolfed

@corwynnm said:

Yeah, man, why would I want to game on a console when I could be looking at my 5" phone?

O.o

Especially if you can buy a game that cost $80m to develop for just $10 second-hand without a single penny going to contribute to development and publishing costs, before reselling that game at $10 meaning you got to play it for free and a third person also avoids contributing to development costs.

The question isn't why wouldn't you prefer to play on a big screen. The question is why would developers want to spend tens of millions and several years on games that might well not return a profit when the same creators could spend a fraction of the money and can make huge profits.

Avatar image for konchu
konchu

@corwynnm: if your tablet was strong enough to compete with the quality of your console and you just had to flip you tv over to tablet input and pick up a controller to play on your TV it would be bad at all? I see as a logical progression that could happen in time. That is not to say your tablet is the xbox pocket or the PS Slate the console makers will evolve too. It hasn't happened yet cause we still need disk Internet is not good everywhere yet. And technology still has room to grow but if my phone can play the awesome games no matter were I am I say that is progress. Sitting in the lounge on lunch break with a head mounted display playing the hotest games sounds awesome to me.

Avatar image for jenovaschilld
jenovaschilld

I like Phil Spencer myself, he talks like a politician, loves the camera or microphone, basically any chance to talk. He actually is aware of the industry, as compared to Mattrick and Green, and really seems to be a Xbox cheerleader then say 'someone babysitting a kids toy division, awaiting a promotion to a real industry' as Don Mattrick portrayed.

I believe what he is saying above about the industry, I do not believe for a second he is not in touch with the exact numbers of consoles sold this generation but like a politician, flippantly blows it off. I would love to see Peter Moore come back in some way, he really pushed the games during xbox and xbox 360 as well as dreamcast days. His role now as EA chief operating officer of sports is wasted imho. More time with his family ... please ... so un -corporate American.. pfft.

But I think Phil Spencer is what xbox needed to make this 180 degree change from the abysmal 8th gen launch. The fact that topics like multi media this, social app that, tv this- was banned from Microsoft's showing and put games center stage showed a maturity of leadership as to what gamers want. Consoles are not going anywhere, they will be the AAA game launch platform of choice for a few more generations to come. After all the console is dead, pc will take over has been the same thing I have heard since the mid-80s.

Avatar image for edwardnygma
EdwardNygma

Phil is a classy guy but it is sad MS doesn't want to reveal how many consoles they have sold. PS4 has sold upwards of 22+ million and my guess is Xbox One is around 10 million.

Avatar image for Naewulf
Naewulf

I hope the consoles never die. I know PCs are superior but i just like to sit on a couch and play on a big TV without the need to configure FSAA, Draw Distance, etc.

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LisandroCalejo

i dont wanna be that guy but .. theres this small game that is realy shity ( but i kinda like it) that has 36 million DALY players called league of legends.. whem a game on a single platform is bigger tham a hardware base its not that good for sayd hardware lol

Avatar image for Tiwill44
Tiwill44

Except, people only "need" these two consoles because they're too passive about gaming to build their own PC. That's not really something to be proud of tbh. Those people could leave at any minute or wise up and get a PC. Just look at all those people who jumped ship from X360 to PS4. I suspect a lot of those will wise up again and jump ship from PS4 to PC when the next gen comes.

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mtm2490

@Tiwill44: I suspect you are wrong sir.... its a preference, to a point to where its not passive....its passion for a lot. and for those who are not passionate and more causal, console is a perfect fit man.

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Tiwill44

@mtm2490: I get that it's convenient, but... surely, people will grow tired of playing 30fps games at some point, no?

Avatar image for mtm2490
mtm2490

@Tiwill44: probably. Though I would imagine that maybe next gen, consoles will have something to improve on that. Still many more people don't notice.... or care about that namely more casual people.

Avatar image for Tiwill44
Tiwill44

@mtm2490: Heh, that's funny, because that's what I said would happen after the PS3. I thought the 30fps era was over, I thought the PS4 would run all games at 60fps. Boy, how wrong I was.

Like you said, many people don't notice. So I bet they're gonna do 4K 30fps next. Or just... 1080p 30fps with prettier shadows or something.

Avatar image for mtm2490
mtm2490

@Tiwill44: hah prettier shadows... everything looks better in shadows. Thats why clubs are so dark

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Tiwill44

@mtm2490: lol that's a good one. That explains why the Gears of War demo at E3 was so dark... seriously, I could barely make out what they were trying to show us.

Avatar image for jenovaschilld
jenovaschilld

....And now you’re looking at the PS4 having sold over--I don’t remember their last number-- but over 20 million.....

You know, I think one of your expected Job requirements, would be to know how many consoles your competition has sold and how many you have sold, instead of just taking a guess or what ever the last number you heard someone mentioned at the water cooler.

Avatar image for jenovaschilld
jenovaschilld

...Questions remain over whether games consoles are profitable for Microsoft and Sony (the original Xbox, for example, lost Microsoft billions overall).... Yes, but it allowed a company (not a publisher or developer) with little game industry background to break into the console market with no history of games. (no mario, no sonic, no spyro)

It was an amazing accomplishment as the ps2 and nintendo not only had established consoles but also did really well 6th gen. IT would be like IKEA breaking into the smart phone business during the Iphone 5 and Samsung Galaxy, at the height of their sales and popularity. IT would be easier if EA, Squaresoft, Activision - created a home console to break into the market then Microsoft.

Still though it paid off well as MS made their investment back easily over the 7th gen. But has taken a strange turn this 8th one indeed.

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lostn

I really do like this Phil guy. Past execs at Sony, MS and Nintendo seemed to be not allowed to give competitors their dues, and always talked smack at any opportunity. Phil's been classy, and ever since he took over, it seems Sony reciprocated the respect and haven't fired any shots back at MS.

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Godofthe7dead

The take away that matters:

Phil on PS4 domination:"And now you’re looking at the PS4 having sold over--I don’t remember their last number-- but over 20 million"

Me: LMAO ...Phil that number is months old..it's more like 22-24 Millions.

Phil on XBO sales:"And we’ve sold a ton of Xbox Ones globally"

Question for Phil: Uhm...excuse me sir..How many XBO sold is a "TON" ....?..Phil...? Hello..? are you there..? Phil..?

Avatar image for jenovaschilld
jenovaschilld

@godofthe7dead: These 'politician coated' comments, get laughable sometimes.

Avatar image for lostn
lostn

@godofthe7dead: A ton is 1000kg worth. So, let's say each console is 4kg, that's about 250 consoles. Pretty dire if you take his word literally.

I'm always amused when Americans use the word 'ton' since they don't measure using that unit but it is still a word used in every day vernacular.

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StoneBrawlJaxon

@lostn: https://en.wikipedia.org/wiki/Ton

Silly Americans..... Come on man.

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trotz75

100

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trotz75

Viable?? GTA V anyone?? Biggest selling entertainment product ever

Avatar image for UnbornCorpser
UnbornCorpser

Of course it's viable still it appeals to those who can't bother themselves with building a PC, or if they are too worried/don't know how to, or those who don't want to spend a lot of money. Doesn't mean consoles are for the best since they still keep games locked to settings that were the best about 5 years ago. In another 10-20 years consoles will be so far behind PCs it won't even be funny. But I will admit consoles do make developers focus on gameplay some of the time because of their limitation with graphics.

Avatar image for jenovaschilld
jenovaschilld

@UnbornCorpser: Hey that is the exact same comment I heard during the mid 80's..., and 90s, and 00's, I mean exactly same. Why wont the gaming industry realize this brilliant insight, and stop making consoles?

Avatar image for UnbornCorpser
UnbornCorpser

@jenovaschilld: Regardless of how you or I feel about them consoles help the gaming market. What bothers me is how they keep using crap components just to keep the price low. They won't stop making consoles unless a huge amount of people leave them for PC which won't happen. They are scared to make one; they don't know how to; too expensive; don't like a keyboard+mouse even though there are alternatives; etc.

Just like how PCs won't go away neither will consoles.

Avatar image for jenovaschilld
jenovaschilld

@UnbornCorpser: Well I would disagree with 'crap components' - every console sold right now is sold at a loss as they are heavily subsidized the first few years or more. You see folks complaining that the consoles are under powered or that you can make a gaming pc for the same - but that is not really true. When you add in a blu-ray player, wi fi, multiple connections, controller, and of course a OS that equivalent gaming pc far costs more. Not to mention consoles are tough, with less failures then group pc components (even the xbox 360).

But even that tired old 7th gen xbox 360 sold now at amazon for $185 that is 10yrs old now. You cannot make an equivalent gaming pc for that price even now, not mention games are still being made for 7th gen consoles - no one is making games designed for windows vista and graphics cards geforce 7600 specs anymore. But of course that is the whole point behind consoles - it allows a specialized mass produced device to be placed into as many hands as possible - regardless of knowledge or income.

As someone who has pc gamed it up since Karateka for apple iie pc and built pcs before discrete video cards, there is not better value then consoles. I am not saying that gaming pc are not the best - because they are but require a larger investment of time and money.

Avatar image for UnbornCorpser
UnbornCorpser

@jenovaschilld: I would say the larger investment would be the best choice though as it leads to the better experience. Not only for gaming but PCs can pretty much be used for everything.

Avatar image for vegasdog
VegasDog

@UnbornCorpser: In 10-20 years? Pc won't have many, if any at all, AAA games. We're all headed for streaming. You'll be streaming 4k to your Tv and cell phone, no need for a console or Pc. Every major developer is headed that way as we speak. Sony has PlayStation now, MS da cloud, EA access, Nvida shield and even Amazon jumping into the game, there's more but I think you get my point. I'm sure there will be some Indy developers left, meh........

.

Avatar image for jenovaschilld
jenovaschilld

@vegasdog: You are right in - cloud gaming, and or streaming will be the eventual future ... but even 10-20 years from right now, I would still say there will be dedicated markets for consoles and PC even then just for enthusiasts.

But it will really not effect developers in anyway. After all they make and design games that a bank of cloud servers run and send to a I/O video device near you. Even if all devices are streamed or cloud based it will not change how developers create the new games and content we love. There simply is no correlation between streaming/ cloud and AAA games by developers.

Avatar image for vegasdog
VegasDog

@jenovaschilld: I think you're wrong. i get the sense developers are sick and tired of losing billions to piracy. Most are talking about pulling out and going to a closed streaming system that 'll pay for itself. Most Of us Americans can't see it because our internet speeds are shit. Soon the monopoly cable companies, or any corporation really, will need to invest in infrastructure to stay afloat on a global stage. The rest of the world is miles ahead of our internet speeds, due to the greed of the 1%.They want us to pay for it, that's why they're trying to kill net neutrality. If they own the net? They can charge whatever and whomever they want, that's a shitload of power.

Avatar image for jenovaschilld
jenovaschilld

@vegasdog: Piracy has not effected the video game industry nor does it account for any real percentage of growth losted of the 73bil market in 12', 93 bil in 13' and an est well over 100+ bil last year. What they would love to see most is the sale of used games stopped. publishers/developers would love to see a repeal of the 'first use law' or to be excluded from it. for more then 100 years now you can buy something, resale it, trade it, modify it, give it away, etc since after buying something it is then considered property. Books, magazines, albums, lawn mowers, boats, shows, etc.

A total closed streaming method, well may be the future - but I doubt it. As closed systems like TV (streaming is a closed systems) would not prevent the VCR, the tivo, netflix, and youtube from changing the markets.

Net neutrality is now, law of the land, but sadly I think ISP companies will add tons of laws to weaken it over time. But it will not effect the fate of PC and video games all by themselves.

There are many countries in the world with faster internet then us, but like Japan, S korea, Latvia, Hong Kong their countries are no bigger then Kentucky with population densities that are concentrated with less resistance to expansion then say America. The amount of broadband, the speed, the penetration over such a larger area/country pust America several hundred times larger then anyone else. Could we be faster? could we be better? hell yes! But it is less about a conspiracy theory and more of a logistics matter.

Vegasdog, your very passionate about your opinions, which is great, but your understanding of the world seems to be that of a Jersey shore, degree in facebook educated facts, who considers themselves smart because they have google on their phone or funny because they read jokes off of facebook. You know a result but not the work it took to get there.

Avatar image for vegasdog
VegasDog

@jenovaschilld: "Piracy has not effected the video game industry". I stopped there, no need to go any further, that's ridiculous.

The argument is straightforward and both intuitively and logically sound: for every pirated copy of a product, there is some potential loss of income to the producer of that product. This is not the same as saying that every pirated copy is a lost sale. What it actually means is that firstly some proportion of the people who are pirating a game would have bought it in the absence of piracy. Equally as important however is the fact that even those who would never have paid the full purchase price for one reason or another may still have paid some lower amount to purchase and play the game which they pirated.

lf you truly care to understand read this..... http://www.tweakguides.com/Piracy_1.htm

....otherwise, go away.

Avatar image for UnbornCorpser
UnbornCorpser

@vegasdog: Are you serious? PCs have been the main focus of usage since they first became usable by the public. The first game ever was made to work on a PC and that won't ever change. Streaming will never work because there are some locations in America that still have crappy to no connection. And there are locations across the planet in other countries that have the same issue if not worse. If any company deviates from Console and/or PC they will go bankrupt once the fad dies.

Overall a PC is normally useful if not essential for a lot of people it won't go away. Phones only do so much and not every TV is made to handle or do everything. Trust me it won't go that way.

Avatar image for vegasdog
VegasDog

@UnbornCorpser: You're wrong. The only thing in life that stay's the same is change. You're correct in saying gaming is driving the PC. BUT, developers are losing billions to piracy and are going put an end to it once and for all. This will ultimately be a good thing for the industry.

Avatar image for UnbornCorpser
UnbornCorpser

@vegasdog: How exactly am I wrong? And they aren't losing anything those who pirate never planned on purchasing anyways so they wouldn't have gained any money even if pirating was gone.

Avatar image for vegasdog
VegasDog

@UnbornCorpser: Wrong again. Your problem is you see life as black and white. NOTHINGS that simple. Not everybody that pirates a game was going to buy it, but there are people that would buy the game if no choice. Human Being are greedy little snots and want what they can't have. Look at almost every marketing campaign. see a lot of ugly girls?

Ending piracy would save them money, if only the wouldn't have to fight piracy anymore. That takes resources and cash. No matter how you slice it, it doesn't make much economical sense to keep it on PC. Money moves the world my friend, and that's where they're going to go, I fking gurantee it. Barring a consumer revolt,that's why they're spoon feeding us now, that and the fact the internet speeds are shit in North America.

It's plain as day to see what Phil Spencer is doing. He's trying to merge PC and console gamers. He's trying to make xbox live the go to service for Win 10. Why do you think they're even giving Win 10 away for free? They're trying to win over the PC gamer among other things. Gaming is going to streaming, I don't know exactly when, but it's coming and quickly.

Avatar image for UnbornCorpser
UnbornCorpser

@vegasdog: I'm loving this...without any proof you claim I am wrong to the point you believe you yourself are infallibly correct. I don't see things in black and white I see reality. You can't end piracy they will always find a way to get the games regardless of what they do.

Besides the rest of your post isn't really...fact. It's what you believe but regardless of that one of MS's main reasons to give out a free OS is to get more people to stay with them and not move on. Mac and Linux are getting more peeps on their side and doing something like this might get some to switch over back to MS or stay.

Anyways I've seen how you talk to people you push everyone else's statements down or claim them to be false while parading yourself around as the correct one. This won't end in any other fashion so nice talking...uh saying what I want and having to read your "I'm right" statements.

Good day sir/ma'am.

Avatar image for vegasdog
VegasDog

@UnbornCorpser: Nothing is 100% but good luck pirating a closed system. Can't talk to you, you're so far removed from reality, it's ridiculous.

Avatar image for UnbornCorpser
UnbornCorpser

@vegasdog: I'm removed from reality? You are the one deluding yourself that these people can stop pirating completely. By the way thanks for proving my point with my 3rd paragraph. And I hear ad hominem is in this month buddy.

Avatar image for hystavito
hystavito

@vegasdog: I agree an all streamed future is coming, but there are still many unknowns. Will they go all the way with the service only model and not force us to buy any special hardware except maybe a bluetooth/wired controller? Make software clients for iOS, Android, Windows, maybe even Linux, who knows, and just forget about making us buy some kind of box?

Will any AAA games as we know them today exist at all? If mobile-style games become too important they could suck resources away and we might see very few "serious" gamer type games, streamed or not. It's possible we could hit that point where all these big game companies decide to stop with the big budget titles and instead produce lots of small budget mobile-style games. By mobile-style I mean simple time wasters, designed for short play sessions, no learning curve, very casual, you get the idea :). Remember that many "serious" gamers become more and more casual and mobile type gamers as they get older, but the reverse is extremely rare.

On a side note, long before we'd see a "death" of consoles, we'd see a period where they are still very much alive but just not the primary focus anymore. We've already seen that with PC, and look how long that's been going on. PCs are certainly low priority for most game companies but still nowhere near "dead".

Avatar image for vegasdog
VegasDog

@hystavito: They way I see it, MS is merging Pc and console now. Steam and MS are head for a huge fight if they don't get on the same page, there's rumors. I think you're correct in assessing a shift to mobile, but at the same time, I see pc/console/mobile all merging into a single gaming environment in Win 10. There will still be a market for AAA gaming and competition for our dollar, sure there will be a decline, maybe not. Less developers for sure.

Avatar image for jenovaschilld
jenovaschilld

@hystavito: The all streamed future is a desirable one for the gaming industry, but I believe a hybrid mix of the two will be the most likely one. One thing is a lot of pressure coming to the FTC, and around the world is for better consumer protections for digital sales to be more like retail sales protections. Refunds, appropriate labeling, litigation, etc., more importantly actual ownership of a product after a digital sale, not just a lease of a license. (ie used game sales)

And if the game industry follows the movie, tv, book, music industries - and it would seem so.. there will be a wildly diverse route of how games are consumed and produced. There will still be AAA, still be Indie, still be amazing games beyond belief and of course big ol piles of stink.

Death of the console, probably not. As the world falls more into line of what we consider middle class, there will be many more consumers who want a dedicated gaming machine that is sold subsidized, and with the ease of just putting in a game. All in one set top boxes, pc only, mobile only is just more rhetoric companies spout to bring investments into what they are developing at the time.

Avatar image for vegasdog
VegasDog

@jenovaschilld: I'm sure there will be a transition period, heck we're in it now. IMO their goal is to end physical retail and completely own their product. To end piracy there will be an all digital future, always online. The only question is, how long will it take?

Corporations own basically the world and will do whatever the hell they want, unless we the people stand up. I don't see that happening. Always remember it's the casuals that own the market, not the hardcore. Most could give to craps about a physical, digital copy, imo. I'm starting to like the convenience and the instant gratification myself.

And if you believe in capitalism, prices should fall, guessing they should resemble Steam prices.

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silkeejeezie

Forever consoles mann.. about 80% of the world dont know much about PC or even going with a steam machine. You can buy a gaming PC but still non pc savvy folks dont know about the game settings or whatnot.

Dont get me started with mobile gaming. Only fun for passtime not hardcore gaming. Dues ex looks and feels soo much nicer on console or pc than mobile. Sure mobile gaming is better than before but will never be better than ps4,xb1 or pc no matter the newest mobile processor.