What Does 'Recommitting' to Consoles Mean for Xbox's 'Everything Is an Xbox' Strategy?

After having difficulty competing with the PlayStation and Nintendo Switch, Microsoft's gaming division has spent the past few years attempting to rebrand the Xbox as primarily a software company: it began with Steam releases and cloud streaming, and continued with the difficult"This is an Xbox" advertising initiative, and reached expressions such asWe can pay tribute to the Halo tradition on PlayStationwhich might only be interpreted as acknowledgments of failure. Now, following the sudden retirement of long-time leader Phil Spencer, incoming Microsoft Gaming CEO Asha Sharma has stated that the company "will honor our heritage with a fresh dedication to Xbox, beginning with consoles."

What, precisely, does that imply about Microsoft's gaming strategy in recent years?

Perhaps it signifies absolutely nothing. It's the kind of comforting yet vague wording we anticipate from executives aiming to calm fan (and particularly, investor) concerns that things are about to go completely crazy. And the Xbox leadership has consistently mentionedIt will keep producing gaming consoles., although we have to envision that theRAMpocalypsehas developed some strategies that appeared to be well-founded only a few months back, but are now much more uncertain.

The complete text of Sharma's opening message to her team, released publiclyon Microsoft's blog, follows the well-refined C-suite strategy of suggesting a strong sense of vision without actually pledging to anything specific. According to Sharma, Microsoft Gaming will:

Reaffirm our dedication to the core Xbox audience and gamers" while also "expanding into new categories and markets where we can provide genuine value
Act with a sense of urgency since gaming is experiencing a time of swift transformation, but also avoid pursuing immediate efficiency or overwhelming our environment with lifeless AI content.
Honor our heritage with a fresh dedication to Xbox, beginning with the console" while also "grow across PC, mobile, and cloud... [and] eliminate obstacles so developers can create once and connect with players everywhere without any trade-offs
"Embrace the rebellious spirit that originally shaped Xbox," as Microsoft is valued at around $3 trillion.

It appears highly improbable that a company deeply focused on AI and cloud technology would reduce its software availability across various devices to "refocus" on selling games exclusively on one console. It also seems equally unlikely that it would cease selling its PC games on Steam, especially considering the years spent developing the Xbox app have not produced an interface that many find appealing.

Maybe there's a clue here that Microsoft is prepared to move away from its all-in-on-Game-Pass approach, now that it's evident the service will not attract the tens of millions of subscribers it had hoped for, and that it may have evenstolen sales from the gamesMicrosoft invested billions of dollars to purchase.

I mean, truly, what other interpretation could Sharma's statement "We are witnessing the reinvention of play" have?

Okay, it could mean literally anything.

But if I could highlight one specific phrase that I believe I can accurately translate from CEO jargon into plain language, it's this statement, found near the conclusion of the letter:

We will create innovative business models and new methods of engagement by leveraging our existing assets: legendary teams, characters, and universes that fans cherish. However, we will not view these worlds as unchanging intellectual property to exploit for profit. Instead, we will develop them further.a common platform and resources that empower developers and athletes to develop and distribute their own narratives."

The emphasis above is mine, and here's what it signifies:

The children enjoy Roblox, and they create all the games on their own! How can we get a share of that?