Microsoft’s gaming business is going back to its original name: Xbox.
Four years after the tech giant changed the division’s name to Microsoft Gaming, its leaders have decided to change the name back to Xbox and laid out their vision for the next stage of the business.
“‘Microsoft Gaming’ describes our structure but it does not describe our ambition. So, we are going back to where we started and changing our team’s name,” CEO Asha Sharma and chief content officer Matt Booty said in a memo to staffers Thursday.
“To achieve our master plan, the way we work must transform,” Sharma and Booty said in the memo, titled “We Are Xbox.”
Sharma, most recently president of product development for Microsoft’s CoreAI division, took over leadership of Microsoft’s games division in February following the exit of Phil Spencer. The company had officially adopted the Microsoft Gaming name in January 2022, when Microsoft announced its deal to acquire Activision Blizzard in a $69 billion deal (which closed in October 2023).
Sharma and Booty laid out the challenges for the Xbox team. “We have work to do,” they wrote. “Players are frustrated.”
The issues, as spelled out in their memo, include the following: New feature drops on console have been less frequent; Xbox’s presence on PC isn’t strong enough; pricing is “getting harder for people to keep up with; and core experiences like search, discovery, social and personalization still feel “too fragmented.”
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The two execs name-checked Roblox: “Some of the biggest recent hits are coming from small teams or even single creators, and places like Roblox are producing experiences that rival major franchises in scale. More players are also choosing subscriptions and services as their primary way to play, with expectations set around instant access, ongoing value, and libraries that evolve continuously.”
Earlier this week, Microsoft’s games division announced it was dropping the price of its Xbox Game Pass subscription plans while also holding back new “Call of Duty” titles for about a year.
Sharma and Booty said about Xbox’s future strategy, “Console is at the foundation, delivering a premium experience, and cloud brings that experience to any device. You can play where you want, and your games, progress, friends, and identity stay with you across console, PC, mobile and cloud.”
Going forward, they wrote, “Our new north star will be daily active players.”
They said Xbox will execute that strategy through four priorities: hardware, content, experience and services.
In terms of hardware, the Xbox team must “stabilize Gen9 as a healthy and high-quality base” and deliver Project Helix to “lead in performance and play” on console and PC games. Xbox also will “build a strong ecosystem that expands choice and reach,” the execs wrote.
On the content front, Xbox will “grow and extend an enduring portfolio of franchises players love,” as well as expand into China, emerging markets and mobile-first audiences, according to the execs. The division also will “maintain and grow in live games and long-term stewardship” and elevate creator-centric platforms like Minecraft, The Elder Scrolls and Sea of Thieves.
Regarding experience, Xbox must “fix the fundamentals for players and partners” and “make Xbox the best place for developers and creators to build and grow,” Sharma and Booty said.
In services, Xbox will “fortify Game Pass with clear differentiation and sustainable economics” and “return the business to durable growth with strong cost discipline,” per the execs’ memo. Xbox also will “use M&A deliberately to accelerate growth where organic paths are too slow.” In addition, they said, “we will reevaluate our approach to exclusivity, windowing, and AI, and share more as we learn and decide.”
From Variety US