VGC: Phil Spencer may be remembered as the man who killed Xbox

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SolidGame_basic

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#1 SolidGame_basic
Member since 2003 • 45401 Posts

Phil Spencer spoke to the press at GDC last week, offering some context/spin on Microsoft’s recent manoeuvres, while dropping a few now-customary hints about the Xbox division’s future plans.

Speaking to Polygon, which has chopped the interview up into multiplenewspieces in the classic early-2010s style, Spencer lamented that the game industry simply isn’t growing enough, explaining that all of Microsoft’s recent moves — the Acquisition Blizzard concessions, the decision to take Xbox exclusives to PS5 and/or Switch, the layoffs — have been designed to counter this unavoidable, irrefutable truth.

Without new customers, Spencer says, “everybody else’s customer is your success state. You can’t succeed unless you draw in customers from other publishers and other platforms. And because you’re not finding new customers with the games that you’re building, everybody’s kind of fighting over the same-size pie.

“When you have an industry that is projected to be smaller next year in terms of players and dollars, and you get a lot of publicly traded companies that are in the industry that have to show their investors growth — because why else does somebody own a share of someone’s stock if it’s not going to grow? — the side of the business that then gets scrutinised is the cost side. Because if you’re not going to grow the revenue side, then the cost side becomes challenged.”

Now look, Spencer is right, to a degree, and if this were coming from a punter, a rank-and-file developer at a random game studio, or a modestly successful newsletter idiot it would be fair comment. But Phil! Mate! I am sorry to have to point this out to you, but you’re the head of Xbox.

I’m not sure you get to pin all this on the macroeconomic this-and-that, you know? You have had, I think it fair to say, a degree of agency in all this. Indeed, there are maybe half a dozen people with the power to actually change the shape of the game industry, and for the last ten years you have been one of them.

I do not see much point in dwelling on how we got here, because I think it is quite obvious to us all what’s gone wrong. All of Spencer’s big bets — the pivot to subscriptions, the variable hardware SKUs, the spending spree of studio acquisitions — were contingent on Xbox not just being, to borrow the Xbox tagline, ‘the best place to play’, but the best place to play the best games.

If there’s one lesson we can take from the Spencer era it’s that you can enact all the disruptive change you like, but you cannot disprove this industry’s oldest truth: great games sell consoles. A hundred billion dollars later, Xbox still doesn’t have them — if anything I would argue its firstparty output has got worse since the shopping spree began — and its struggles are, as such, no surprise at all.

Now that all his big bets have failed, Spencer is turning to corrective measures — short-term fixes that might juice the numbers in the next couple of P&Ls, but seem destined to further weaken the Xbox ecosystem down the line.Bringing the likesof theEpicGame Store and Itch.io to Xbox consoles would confuse the value proposition, give users more ways to give money to people that aren’t Microsoft, and do nothing to transform Xbox’s fortunes.

Let us assume, charitably, that Sea Of Thieves sells 5m copies at $40 a pop when it launches on PS5 next month. Let us even more charitably pretend that means $200m in revenue for Microsoft, ignoring distribution and marketing, Sony’s platform cut, and the cost of making the port in the first place. Last quarter, $200m would have increased Microsoft’s revenue by about 0.3%. That is merely a rounding error for a company of that size, and where the health of its gaming division is concerned, it is little more than a sticking plaster.

To be clear, I feel bad for Spencer. He seems a decent sort. I think he’s come into this with the best of intentions, and in a parallel universe where every horse he backed romped home, he would be credited with transforming, and perhaps even saving, the game industry. In another, where instead of spending $70bn on Activision Blizzard he spent it on 230-odd games with the same budget as Spider-Man 2, perhaps Xbox is flying.

But in our world he has spent ten years and gargantuan amounts of money taking Xbox from third place to third place, and that is not the market’s fault. If the writing isn’t on the wall for Xbox as a whole, then it certainly could be for him.

Wowie.. thoughts, SW? Is Phil partly to blame for Xbox's demise? Or was Xbox going down that route regardless?

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hardwenzen

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#2 hardwenzen
Member since 2005 • 39691 Posts

This is exactly what i've been telling @last_lap, but he doesn't believe me. Wish he listened for once.

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GhostOfGolden

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#3 GhostOfGolden
Member since 2023 • 2612 Posts

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nintendoboy16

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#4 nintendoboy16
Member since 2007 • 41574 Posts

Can't say I disagree at this point. And I just got an XSX this month.

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ENI232

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#5 ENI232
Member since 2020 • 1007 Posts

I will remember him/her?? as a hologram.

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DaVillain

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#6 DaVillain  Moderator
Member since 2014 • 56343 Posts

Why are we talking about Phil when today is the last day (at the time of this post) for Jim Ryan as he's leaving Sony today. Where's the thread for that? No retirement party at all?

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adsparky

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#7 adsparky
Member since 2006 • 2595 Posts

Xbox was in life support before he took the reigns, so it would be pretty unjust yet realistic if he get the blame if xbox cease to exists as a console.

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adsparky

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#8 adsparky
Member since 2006 • 2595 Posts

@davillain said:

Why are we talking about Phil when today is the last day (at the time of this post) for Jim Ryan as he's leaving Sony today. Where's the thread for that? No retirement party at all?

We're happy he's leaving, but throwing a party just for that is a little excessive.

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DaVillain

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#9 DaVillain  Moderator
Member since 2014 • 56343 Posts

All I'll say is the Xbox One is and still is one of the worst Xbox consoles MS has never put out! It is the most redundant console I have ever seen. If you like it, well good for you, but its by far the worst console! Phil on the other hand, it wasn't his fault Xbox One was so gutted, that damage was already done and he did the best he could with it. Seeing him in charge on the Xbox Series is a major improvement on the brand and bringing games to PC is a major plus.

Phil Spencer has done good so far, he gets carried away overspending such as Activision and IMO, that's not good for business. But we'll see within a few more years if Phil made the right choice or not. And really, Xbox brand would have ended up doomed and gloom if it wasn't for Phil cause I don't see anyone could have done better than what Phil has done.

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Macutchi

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#10 Macutchi
Member since 2007 • 10533 Posts

"...you cannot disprove this industry’s oldest truth: great games sell consoles. A hundred billion dollars later, Xbox still doesn’t have them"

i bought an xsx based more on the potential of what exclusives were to come from all their acquisitions, motivated too by the lack of first party output from sony this gen.

i'm willing to play the waiting game and gamble on future potential but it's hard to disagree with what's said in the article, especially citing seemingly defeatist quotes like this from the ceo of microsoft gaming after almost $100b of studio and publisher acquisitions

"You can’t succeed unless you draw in customers from other publishers and other platforms. And because you’re not finding new customers with the games that you’re building, everybody’s kind of fighting over the same-size pie."

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DaVillain

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#11 DaVillain  Moderator
Member since 2014 • 56343 Posts

@adsparky said:

We're happy he's leaving, but throwing a party just for that is a little excessive.

LOL so true.

I'm just glad Jim is gone. So many mistake that man has made, I really hoping Sony picks the right person this time around.

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Pedro

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#12 Pedro  Online
Member since 2002 • 70227 Posts

Damn, I am perpetually on the minds of some folks. 😂

Not sure how you could be known for killing Xbox when it isn't dead. 🤔

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SolidGame_basic

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#13  Edited By SolidGame_basic
Member since 2003 • 45401 Posts

@Pedro said:

Damn, I am perpetually on the minds of some folks. 😂

Not sure how you could be known for killing Xbox when it isn't dead. 🤔

Is that why Xbox first party games are coming to PS5??

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sakaiXx

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#14 sakaiXx
Member since 2013 • 15984 Posts

Crazy hit piece this definitely making rounds in the gaming bubble.

Though I do am glad that more people no longer worshipping Phil Spencer. Dude been at the top of Xbox for a decade now and his output has been very abysmal. Really great case study of creating a cult personality tho he really great at PR, the best even in the first few years of leadership.

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Ospi

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#15 Ospi
Member since 2006 • 562 Posts

There's little doubt the brand is in trouble. They've declined in almost all important metrics.

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Pedro

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#16 Pedro  Online
Member since 2002 • 70227 Posts

@SolidGame_basic said:

Is that why Xbox first party games are coming to PS5??

How can Xbox games come to PS5 if Xbox is dead?🤔

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SolidGame_basic

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#17 SolidGame_basic
Member since 2003 • 45401 Posts

@Pedro said:
@SolidGame_basic said:

Is that why Xbox first party games are coming to PS5??

How can Xbox games come to PS5 if Xbox is dead?🤔

How do Sega games come to PS5 if Sega is dead 😎

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GhostOfGolden

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#18 GhostOfGolden
Member since 2023 • 2612 Posts

@SolidGame_basic said:
@Pedro said:
@SolidGame_basic said:

Is that why Xbox first party games are coming to PS5??

How can Xbox games come to PS5 if Xbox is dead?🤔

How do Sega games come to PS5 if Sega is dead 😎

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R4gn4r0k

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#19 R4gn4r0k
Member since 2004 • 46556 Posts

@davillain said:

Why are we talking about Phil when today is the last day (at the time of this post) for Jim Ryan as he's leaving Sony today. Where's the thread for that? No retirement party at all?

Ain't it weird how every single cow thread is just a variant of a Phil Spencer thread or an Xbox game thread?

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R4gn4r0k

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#20 R4gn4r0k
Member since 2004 • 46556 Posts

@sakaixx said:

Crazy hit piece this definitely making rounds in the gaming bubble.

Though I do am glad that more people no longer worshipping Phil Spencer. Dude been at the top of Xbox for a decade now and his output has been very abysmal. Really great case study of creating a cult personality tho he really great at PR, the best even in the first few years of leadership.

I'm not sure where all this Phil worshipping is coming from, but I do know who I'll be celebrating this Easter.

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Pedro

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#21 Pedro  Online
Member since 2002 • 70227 Posts

@SolidGame_basic: Is Sega making consoles?🤭

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Archangel3371

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#22 Archangel3371
Member since 2004 • 44462 Posts

I don’t know about that but I do know that I’m thankful to him for Game Pass. 😎

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R4gn4r0k

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#23 R4gn4r0k
Member since 2004 • 46556 Posts

@Archangel3371 said:

I don’t know about that but I do know that I’m thankful to him for Game Pass. 😎

Also Phil "stop worshipping me" Spencer revived a ton of games people loved:

  • Battle Toads
  • Age of Empires
  • Killer Instinct

Also Phil broke the whole Halo/Gears/Forza cycle which was truly killing the Xbox brand.

Not his wanting to be the Netflix of gaming or putting some games on another platform as a third party publisher.

But hey, I guess that doesn't make for a flashy headline, and that's all people need these days.

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Archangel3371

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#24 Archangel3371
Member since 2004 • 44462 Posts

@R4gn4r0k: Definitely love the Killer Instinct revival. Really hoping that there’s another game in the franchise in the future. Very cool that Age of Empires was revived as well. Played a ton of AoE II on the PC back in the day.

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BassMan

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#25 BassMan
Member since 2002 • 17893 Posts

I like the moves Phil and Xbox are making. They just need to focus on bringing the quality of their games up and avoid ruining them with forced woke shit. Dat new Fable... LOL, WTF?! How are we supposed to get excited for that?

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Pedro

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#26 Pedro  Online
Member since 2002 • 70227 Posts

Woke boogieman has entered the chat.😂

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DaVillain

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#27 DaVillain  Moderator
Member since 2014 • 56343 Posts

@BassMan said:

I like the moves Phil and Xbox are making. They just need to focus on bringing the quality of their games up and avoid ruining them with forced woke shit. Dat new Fable... LOL, WTF?! How are we supposed to get excited for that?

Oh come on Bass, we have mods to fix everything...even the main women:

Maybe not the best future mod, but hey, its a new Fable, the mod community will make sure we'll get the good stuff😉

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judaspete

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#28 judaspete
Member since 2005 • 7343 Posts

@davillain: Isn't there going to be a character creator anyway?

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IMAHAPYHIPPO

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#29 IMAHAPYHIPPO
Member since 2004 • 4198 Posts

@davillain said:

Why are we talking about Phil when today is the last day (at the time of this post) for Jim Ryan as he's leaving Sony today. Where's the thread for that? No retirement party at all?

Sony already threw him one at one of their internal studios and then shut that studio down less than a week later.

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judaspete

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#30 judaspete
Member since 2005 • 7343 Posts

Nah, I don't think Xbox is dead. A lot of Phil's ideas have not panned out (or really, grown as fast as Wall Street wants them to) but he does have Xbox innovating. I think something will stick.

The big acquisitions were a mistake though, namely Bethesda and Activision. Those were both only willing to sell themselves because they were on the precipice of a downward spiral. The initial strategy of buying small underrated developers, and giving them access to big money, was a better way to go. Now he just needs to get them consistently releasing games.

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Last_Lap

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#31 Last_Lap
Member since 2023 • 6615 Posts

@hardwenzen: Bitch please 🙄 I have been calling for Phil to quit/get fired before ALL of the media started to make hit pieces.

I'm glad to see EVERYBODY else catching up including you.

I'm a maverick lem, don't ever forget that.germy hermy 🤣

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SargentD

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#32 SargentD
Member since 2020 • 8350 Posts

@davillain said:

Why are we talking about Phil when today is the last day (at the time of this post) for Jim Ryan as he's leaving Sony today. Where's the thread for that? No retirement party at all?

We know why.. lol

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navyguy21

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#33 navyguy21
Member since 2003 • 17454 Posts

Clearly labeled as an opinion piece.

He wrote the same post on his blog and then submitted it to VGC..........with a different name.

Xbox is dying, and it's definitely not Big Phil's fault.

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BenjaminBanklin

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#34  Edited By BenjaminBanklin
Member since 2004 • 11256 Posts
@ghostofgolden said:

I swear to god Pedro is so bad at being a lem

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hardwenzen

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#35 hardwenzen
Member since 2005 • 39691 Posts

@last_lap said:

@hardwenzen: Bitch please 🙄 I have been calling for Phil to quit/get fired before ALL of the media started to make hit pieces.

I'm glad to see EVERYBODY else catching up including you.

I'm a maverick lem, don't ever forget that.germy hermy 🤣

You never said that on SW. In fact, you loved him, and wanted more Forza to be available on GP on day one.

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Antwan3K

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#36 Antwan3K
Member since 2005 • 8319 Posts

Cows.. the #1 source for all things Xbox..

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DaVillain

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#37 DaVillain  Moderator
Member since 2014 • 56343 Posts

@judaspete said:

@davillain: Isn't there going to be a character creator anyway?

Fable will have the usual creation character. I was just saying if it's not good enough, well the mod community will just make it good if not better. Look at Skyrim and how that went.

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GhostOfGolden

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#38 GhostOfGolden
Member since 2023 • 2612 Posts

@Pedro said:

@SolidGame_basic: Is Sega making consoles?🤭

They used to until they flopped out of the hardware business. Which was kinda the point of their post 🤭😂🤣

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BenjaminBanklin

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#39 BenjaminBanklin
Member since 2004 • 11256 Posts

To be honest. I never GOT Phil Spencer. What made this motherfucker so charming where he could get tens of billions to prop up his ailing division when Xbox isn't a profit generator for MS? I swear he seemed more interested in making himself a cult figure within the company as opposed to making sound business decisions. Xbox's tenure under Peter Moore was way more successful, and they gave him the boot for RRoD (even though they'd tell you different).

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Last_Lap

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#40 Last_Lap
Member since 2023 • 6615 Posts

@hardwenzen:

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hardwenzen

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#41 hardwenzen
Member since 2005 • 39691 Posts

@last_lap said:

@hardwenzen:

What? I record everything you say on System Wars, and never have i heard you say that.

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Pedro

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#42 Pedro  Online
Member since 2002 • 70227 Posts

@ghostofgolden said:
@Pedro said:

@SolidGame_basic: Is Sega making consoles?🤭

They used to until they flopped out of the hardware business. Which was kinda the point of their post 🤭😂🤣

So the answer is no.🤭

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super600

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#43  Edited By super600  Moderator
Member since 2007 • 33103 Posts

Eh. Spencer is leading the xbox brand at a time of transition that is not just impacting microsoft but the entire gaming industry. I think to many are tied down by the past instead of looking towards the future or the current reality which is a stagnant console market, higher production costs and a new generation of gamers that don't necessarily want to buy a physical box. Exclusives will still be important but at the same time companies will have to figure out how to properly navigate the new reality. There are obviously things xbox can improve like their localisation efforts though.

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Saint-George

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#44 Saint-George
Member since 2023 • 1373 Posts

Playstation being in last place has got cows searching the depths of the internet looking for comfort..... understandable when their best selling game and biggest franchise on their console is an Xbox studios game and casual PS owners are pre ordering the **** out of Xbox studios games.

Sales and profit win wars... And playstation ain't winning 🤣😂

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Sushiglutton

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#45  Edited By Sushiglutton
Member since 2009 • 9890 Posts

Has Xbox had a single serious GOTY-contender during his reign? Can’t think of one.

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SolidGame_basic

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#46 SolidGame_basic
Member since 2003 • 45401 Posts

@ghostofgolden: he's trying to save face 🤣

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super600

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#47 super600  Moderator
Member since 2007 • 33103 Posts

@Sushiglutton said:

Has Xbox had a single serious GOTY-contender during his reign? Can’t think of one.

Forza horizon 5 was the closest. Hi-fi rush and psychonauts 2 also go high praise.

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mrbojangles25

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#48 mrbojangles25
Member since 2005 • 58473 Posts

God damn, I know sensationalism is a thing and we all gotta get that paper (as the kids say), but that is some clickbait lol.

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mrbojangles25

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#49 mrbojangles25
Member since 2005 • 58473 Posts
@ghostofgolden said:

@Pedro and @Antwan3K OMG you guys, congratulations! What's it like living rent-free in peoples' heads? It must be so nice.

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Pedro

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#50 Pedro  Online
Member since 2002 • 70227 Posts

@mrbojangles25 said:
@ghostofgolden said:

@Pedro and @Antwan3K OMG you guys, congratulations! What's it like living rent-free in peoples' heads? It must be so nice.

It is very affordable because of the low cost.😂