Last month, longtime Microsoft veteran and Xbox chief Phil Spencer retired, handing the floor to incoming CEO Asha Sharma.
Microsoft responded with a major collaboration with AMD For an Xbox-Windows hybrid console, it will not only play Xbox console games, but also full PC games from the open Windows market. Xbox Project Helix is on the horizon, and from talking to various employees, the general mood at Xbox couldn’t be more energizing.
This past week, incoming CEO Asha Sharma The CEO of Microsoft also attended Satya Nadella In an internal Q&A to discuss Microsoft’s top-down vision for gaming. It was honestly refreshing to hear Satya Nadella, decked out in an Xbox hoodie, speak so positively in the Xbox section. We checked the transcript of the Q&A with multiple sources. Here’s what was said.
Asha Sharma met Satya Nadella who said she was happy to be there. He also noted that there were similar doubts about his knowledge of the cloud and infrastructure when he first started as Microsoft’s CEO — before he led Microsoft to become a global leader in the space. He also noted that the game remains one of Microsoft’s largest capital investments and reflects the long-term view of his role at Microsoft.
“This company has core identities. I don’t think Microsoft can exist without those identities continuing to evolve. We’re a platform company, a development company. To be a knowledge worker company and to be a game. Those are the core identifiers of what Microsoft has always stood for and always will stand for. So we have to accept that — we really don’t have to. Matt (Booty) and Phil (Spencer) and Sarah (Bond) and all of you who have built this franchise in its 25th year.”
Sharma thanked Satya for the opportunity and noted the uniqueness of Xbox. He applauded the Xbox team, calling them “incredible” and noting that more than 10% of the Xbox team has been there for over a decade. He said he emphasized Microsoft’s long-term mindset, echoing Nadella’s comments about “playing the game for the long haul,” and asked him to elaborate on that point.
“Frankly, that applies to everything we do. We have to base what we do here for the sake of gaming. It’s about nothing more than just being a great company, and that means making great games and great systems and hardware.”
Nadella highlighted the game’s legacy and impact on Microsoft and the broader technology stack, touting its role as a catalyst for the cloud, Windows, the GPU-based server technology revolution, and more. But he also said that doesn’t mean moving away from what people expect from gaming, and explained why Microsoft will “always” continue to invest in games.
“It carries over from excellence to the rest of the company. I joke with (NVIDIA CEO) Jensen Huang that if it wasn’t for gaming, (NVIDIA) wouldn’t exist. Think about it, DirectXI don’t think the whole GPU revolution or acceleration is going to happen.”
“That’s why I’ve been interested for a long time. Phil, he’s always talked to me about gaming being the biggest category of entertainment — what is gaming in its broadest form? That’s not to say that we’re moving away from people today — when we think about AAA gaming on console. The question is where else can we go to expand that. It’s always about excellence in execution, and software always has risks, but it’s a very different program.
“To me, we’ve been playing the game for a long time. We’re going to continue to invest and always will.”
Microsoft CEO Satya Nadella
Xbox CEO Asha Sharma discussed her time with the various teams at Xbox and talked about Microsoft’s long-term legacy as a software company “factory,” emphasizing that great games can’t be “made” that way, but instead have to be “made” by people. “I spend a lot of time thinking about how I can make these worlds and these stories and characters stronger,” he said, asking Satya Nadella for his thoughts on Microsoft’s responsibility as a company to protect Xbox fans.
“Stories,” Satya began, “why do we love games? They tell the stories, the mythologies that make us who we are. When it comes to that core, the art that goes with it, that’s where we have to get the cultural zeitgeist and then we have to reflect that in everything we do. In games, in the marketing approach, everything we do represents the brand.”
Nadella said he hopes other parts of Microsoft can eventually learn from Xbox, saying Xbox will “at best lift the whole company” because of its consumer-facing nature. He told anecdotes about how some of Microsoft’s high-powered corporate customers often wanted to meet with him because they were Xbox customers at home, just because they were in the enterprise. The game “touches us emotionally,” he said, adding that Microsoft wants that aspect to “always exist.”
Xbox CEO Asha Sharma acknowledged Xbox’s struggles of late, saying gaming is in transition. He echoed our sentiments when he said that “everything has been changed” about Xbox’s strategy A recent interview with Asha Sharmahe said he’s been investigating some of Xbox’s decisions over the past year. They discussed where the game would go in the next phase of its life, but Satya Nadella warned that Xbox can’t lose sight of what it already has.
“We need to make sure that the friends we have today are the friends of tomorrow,” Satya said of existing Xbox customers. “You want to wake up feeling like your friendship is stronger. We really want to make sure that whether it’s a console, PC, Forza, Halo lover, we really want to make sure they love us for what? to wait we should.”
“We need to make sure that the friends we have today are your friends tomorrow. You want to wake up feeling that your friendships are stronger. We really need to make sure that whether it’s a console, PC, Forza, Halo lover, we want to make sure they love us because they expect us to.”
Microsoft CEO Satya Nadella
Satya Nadella talked about how gaming can be a force for good in the world and looked at the culture of doom and gloom that is starting to invade our free time (pun lol). He said the “joy” in active engagement hobbies like gaming and coding is an opportunity to make the world a better place.
“Attention is a limited thing that people have. How can we get permission, with pleasure, to get more of that attention? It brings back the joy… that’s what I’ve always thought. Gaming is active engagement. It’s not so much passive ‘scrolling’ and so on. I want us to be able to bring back that love and emotion that some people represent that active engagement. controller, console or their computer … because you look at the reports that happen … In Coding joy, I want us to experience joy in the game.
The context of welcoming Satya Nadella is long, long overdue
Based on conversations I’ve had with Xbox staff over the past few years, I can’t help but feel that some of Satya Nadella’s comments here are long overdue.
I fully admit that I have taken a dim view of Satya Nadella’s handling of aspects of Microsoft’s business. AI the mismanagement of the Surface brand before the tools were truly fit for purpose, the death of Windows Phone… and the recent disconnect between Xbox and its fans. But indeed, Microsoft has found itself a bit off the rails as it tries to find its footing in an increasingly chaotic consumer technology market.
“I want us to continue to reinvent that moment. Games that people love, consoles and systems that people love, and really doing the best we can as a company. That’s it. That’s all I want us to do,” Nadella concluded. “For the fans that rely on us, I want to make sure we live up to their expectations. I know there’s a lot of feedback… trust me, I’m on Twitter sometimes… but I really think it’s that passion. That’s the core of people wanting us to do fantastic work.
“Our level of distraction continues… I want us to reverse that. Joy in coding, joy in gaming, that’s all I want to live for. If we can get that back, the world would be a better place for that.”
Microsoft CEO Satya Nadella
This awareness and acknowledgment of negative consumer sentiment is echoed in other parts of Microsoft beyond Xbox, including contacts I have in Microsoft’s AI and Windows stacks. Teams in different divisions of Microsoft are private and even to the public in some cases they’ve talked about how energized they’ve been feeling lately, and I think that’s partly due to a general refocus on wanting to move Microsoft to a better place.
Hearing directly from Satya Nadella that the firm will “always” invest in gaming should reassure those who harbor fears that Microsoft isn’t thinking long term here. Signs of the Xbox’s death have been around for decades, and will probably continue to be for another 25 years as it celebrates its 50th anniversary.
Xbox has a lot of challenges to overcome. The marketing of the Xbox is almost non-existent, and when it was, it did not resonate. The exclusive content decision continues to cast a shadow over the console brand, and anemic hardware production and global footprint have left Xbox hardware with a slipping sense of relevance. And that’s before considering the external issues Nadella mentions, such as cost pressures to attract attention and non-gaming platforms and free-to-play games eating away revenue for traditional gaming.
Comprised of the large Xbox console ecosystem and the broader Windows ecosystem, Project Helix could be a unique catalyst for Microsoft to rediscover its dominance in the space. It’s going to be the fight of Xbox’s life, but the team is more ready than ever.
Should Xbox have exclusive games?
The debate over whether Xbox should own exclusive content has reignited since new CEO Asha Sharma took the reins. What do you think?
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