Opinion: Here's why Microsoft will surely release a lower-price next-gen Xbox.
Recently, a white Xbox controller emerged in the wild containing references to an Xbox One S console. This provides further proof that Microsoft is indeed going to announce the console. It's rumored that Microsoft will formally unveil the system during an event in August, but we're still waiting to hear from the company regarding its plans for a second next-gen Xbox.
New consoles are always expensive, and this trend is expected to continue with the release of the Xbox Series X and PlayStation 5 this year. But it might not be the only next-gen system Microsoft will offer. A popular and enduring rumor is that Microsoft will also release a lower-spec, less-expensive model aimed at the more mass-market audience known by the codename Lockhart. This is a great idea--and it's a much more interesting topic to consider now that Sony has revealed its own second, presumably less expensive digital-only PS5.
In fact, the name of Microsoft's next-gen console strategy is officially just called "Xbox," and the "Series X" label is the specific model name. You can think of this like the iPhone--there's the iPhone 11, iPhone 11 Pro, iPhone SE, and iPhone XR that all live under the iPhone umbrella.
For Xbox, I don't see the announcement of a cheaper next-gen Xbox as a matter of if but when. Xbox boss Phil Spencer told GameSpot that it might release additional next-gen Xbox SKUs, and I'm betting Lockhart is one of them. "Obviously, in the name 'Series X,' it gives us freedom to do other things with that name so that we can create descriptors when we need to," Spencer said in December 2019, all but confirming multiple next-gen Xbox consoles are coming.
It makes sense that we haven't heard anything official about the Lockhart machine yet because Microsoft understandably wants to focus on its most powerful model to lead the way. It's critical that Microsoft focuses on this new console instead of another option because hyping the more powerful machine gives Microsoft the ability to go toe-to-toe with the PlayStation 5. That's a key part of Microsoft's strategy this generation as it attempts to climb back after the struggles of the Xbox One era.
It's been reported for months that Lockhart is a real console, but sources have yet to confirm if Microsoft actually plans to release the system or if it is only an idea at this stage. As is typical, plans can change and often do, and the COVID-19 pandemic might have led to further tweaks to the plan.
What we do know is that Microsoft's vision for Xbox is all about giving players options. Currently, you can buy games outright, subscribe to Xbox Game Pass for a Netflix-style all-you-can-eat experience, stream games with xCloud, and play across Xbox and PC with cross-save and cross-progression. Microsoft has been forward-thinking and consumer-friendly in this regard. The next step could be to offer a less expensive next-gen Xbox with some capability removed but still standing as an attractive option.
Not everyone needs or wants the highest-spec machine, and the expected $500 price point of the Series X might be out of reach for a portion of the gaming crowd, especially coming out of the COVID-19 pandemic. This is where the Lockhart system could fill the gap.
Microsoft has been on this path of offering variety and choice for more than a decade. In 2009, Xbox marketing boss Aaron Greenberg spoke about how the one-size-fits-all solution was no longer viable. "There are different sets of consumers who want different levels of experience at different price points," Greenberg told Eurogamer at the time. "A big part of that is having a console on the market that's at a mass-market price-point. Consumers who are new to the experience, or who want a more casual experience, don't have to pay a premium for features they would probably never use."
It's interesting to look back at this interview today because this trend continued with the Xbox One era. Microsoft offered all types of options--the Xbox One, the Xbox One S, the Xbox One S All-Digital Edition, and the Xbox One X. It stands to reason that this will continue to be the case for the next-generation of Xbox consoles that kicks off with the Series X this year.
With the lower price point, the Lockhart console won't offer the same features or capabilities as its super-sized sibling. Unconfirmed reports claim the Lockhart Xbox will have a solid-state drive and focus on gaming with resolutions up to 1440p instead of 4K as can be the case on Series X. The Verge reported that Lockhart will have a next-gen CPU, but it will feature slower clock speeds than the Series X. Also, Microsoft is reportedly planning to drop the disc drive on the Lockhart console, not unlike the experiment of the Xbox One S All-Digital Edition. None of these details have been confirmed, but the smart money is that it will have comparatively weaker specs than the Series X to facilitate the lower price point.
The Lockhart console might not have all the bells and whistles of the Series X, but that's totally fine because price is the most important factor for sales in the marketplace, especially during holiday shopping periods. Microsoft's most powerful consoles never sell the best, anyway. In the Xbox One era, Microsoft released the more powerful Xbox One X--the most powerful console still to this day--knowing full well that it would not be the top-seller in the family of Xbox consoles. Phil Spencer told Gizmodo that it was releasing the Xbox One X to give people the option to have the fastest and most powerful console if they wanted it while the lower-price Xbox One S would be the market-leader in terms of sales. "We'll sell more Ses than we do Xes, no doubt about that," Spencer said. "But the person that plays a lot is looking for the best experience, and we wanted to deliver that."
I foresee a future where the idea of a "family of devices" in the game console market is nothing novel--we're already there, in fact. Microsoft has been doing this for more than a decade, and Sony and Nintendo, too, offer different versions of their hardware to reach the widest audience. Outside of gaming, Apple has already popularized the idea of a "family of devices" with its various iPhone models that give users options depending on affordability, speed, and power.
With the rise of digital services and streaming, some have wondered how much longer platform-holders will keep making consoles. It's my belief that dedicated gaming hardware is here to stay, at least for the next decade. The latest data shows that 31 percent of US households don't have broadband in 2020, so Microsoft is smart to embrace a strategy that gives consumers options. That's already what's happening--Microsoft currently sells Xbox consoles at all different price points and feature sets. Not only that, but with Xbox Game Pass and xCloud, Microsoft doesn't even necessarily need you to buy a console any longer.
Potentially complicating the hardware situation in 2020 are issues with the supply chain related to the COVID-19 pandemic. Just recently, Phil Spencer said he anticipates that Microsoft will be "able to get enough units" for launch, but it's unclear here whether he's solely talking about the Xbox Series X or the total supply for however many systems it might have coming. Whether or not the lower-price next-gen Xbox launches this holiday with the Series X or later on, the console is coming.
In GameSpot's 2019 profile of Phil Spencer, he confirmed that Microsoft wants to give players all kinds of options for their console buying, and a cheaper system is surely part of that plan.
"The number of people that are actually buying a console every generation isn't growing dramatically, if at all," Spencer said. "At one point you have to recognize that, okay, you can't just lead with one device. You can't just say, here's an Xbox. I'm going to go sell this device to every single person and that's what they're going to play on. That just doesn't work."
I don't particularly like the idea of the cheaper Lockhart system doing away with the disc drive. Given the aforementioned broadband concerns, a console without a disc drive might not be a viable or desirable option for some people. Not only that, but cutting the disc drive from the only lower-price next-gen Xbox option doesn't come across as particularly consumer-friendly for a company that does so much in the area of options and choice.
On Xbox One, it's a different situation. While the Xbox One S All-Digital Edition technically has an MSRP of $50 less than the Xbox One S that does have a disc drive, the S model is regularly discounted to bring it closer to the All-Digital Edition price. This gives people the option to choose, and it would be sad to see that go away with the next-gen Xbox. Nothing is confirmed at this stage, so we'll have to wait to hear more from Microsoft about its official plans for a lower-price next-gen Xbox.
Potentially throwing a wrench into the works for Microsoft's strategy is what Sony announced recently--a PlayStation 5 with no disc drive. The system boasts the same power as the standard PS5, it just doesn't have a disc drive. If the rumors are true that Microsoft's cheaper Xbox Series X model without a disc drive has worse specs than the regular Xbox Series X, this could pose a competitive issue for Xbox.
New console launches are exciting--it's fun to get your hands on a shiny new piece of hardware and boot it up for the first time. But Microsoft is not releasing any Xbox Series X exclusives for the first couple years of the console, so the existing hardware you own today will play Halo Infinite, Assassin's Creed Valhalla, and the rumored Call of Duty: Black Ops Cold War without requiring you to upgrade. But if you do want to buy into next-gen gaming, Microsoft seems poised to once more give players options--and that's great.