It is Friday and, as foretold by prophecy, it is time for another look at how things are going over at Microsoft’s XBox Games division. Sad Xbox Games logo generated by Co-Pilot, because AI is what is killing them After the announcement of the great layoff, have Asha and Satya solved the problems they set out to tackle? Do they even have a clue what they are on about? Well, read on and judge for yourself. Asha Sets Some Priorities – But First We Need a Slogan! GameDeveloper – Xbox CEO declares priorities after ‘reset’ Rock, Paper, Shotgun – Xbox execs are trying to sell a gaming division bounce back First out of the gate is XBox Games head Asha Sharma who has declared that the key priorities will revolve around the “Four Cs,” which are “core,” “content,” “creation,” and “connection.” All of those are, in fact, words. Good so far. What they mean however… I don’t know. “Core” seems to be about focusing on consoles… while not dropping anything else… or maybe about consolidating… is that another “c” word… on key franchises. The ones that make a billion dollars a year. You can probably figure out which ones. The only thing that really seems to have a direction is a focus on Minecraft, a group that now reports directly to her, and getting it going on the “content” “creation” business because somebody told her about Roblox or something. Has she seen the recent financials or user reports for Robox? Let’s just say their margins aren’t at the 30% that Satya is demanding and that their line is not currently going up. XBox Sales Are Down Game Developer – Xbox revenue fell by $1.7 billion during fiscal 2026 The Microsoft FY financials were out a while back and, while they just hid as much AI stuff as they could I guess they couldn’t do the same for XBox, especially after making a huge freaking fuss about the division and Are you sure that focusing on the consoles is a good idea. I mean, if you were selling more or if hardware was cheap… is hardware cheap? Next bullet point please! Meanwhile, XBoxes Are More Expensive… Yet Again WCCFTech – Xbox Series Prices Surge up to €200 in Europe 200 Euros is some real money, enough that it is going to depress sales even more so. And while I know that this isn’t because XBox is being greedy or anything, that we’re really just seeing the impact of the AI bubble on the hardware market yet again, there is a bit of irony in that Microsoft is aiding and abetting that bubble so this is still, in part, their own dame fault. And, as an aside, I saw somebody responding to this announcement bemoaning the death of $500 video game console, like the Switch and Switch 2 aren’t a thing. Nintendo only counts when they aren’t doing well. When the Switch has sold 4x units compared to the XBox X/S and the Switch 2 is catching up only a year after its launch, we pretend it isn’t a serious console or something. I am waiting for the end of the hardware crisis when the Steam Deck will outsell XBox hardware. I Know, Let’s Shoot Ourselves in the OTHER Foot! WCCFTech – Xbox May Walk Away From Steam Steam Deck HQ – Xbox May Move Away From Steam This one is not officially announced, floating around merely in the rumor state, but it is so on-brand for this management team, aligned with the completely muddled thoughts on how to achieve success, that I have to give it some level of credence. Look, I do not love Steam. It is an imperfect vehicle and attracts a variety of criticism. I see people angry that it has some level of curation for games it lists, while I personally feel they ought to raise whatever bar they have much higher. But the reality of PC gaming is that Steam is the Walmart of storefronts and if you’re not there then you’re niche almost by definition. Meanwhile, the Microsoft store is just awful. I hate it. I also hate the MacOS Apple Store which Microsoft copied, but at least it works because Microsoft can’t even steal without screwing things up. Nobody cares where I am going to shop, but if I had to buy Forza Horizon 6 from Microsoft directly, I probably wouldn’t have bothered having experienced trying to get FH5 via that route. Microsoft is big, they can negotiate a better deal with Steam… and this might just be a ploy to do so… but they can’t be taken seriously if they are saying they are taking their ball and going home. If they press too hard with Valve then Gabe should just post the “well… bye” GIF and walk away. XBox Game Pass IS NOT FREE This is a more general gripe on my part that doesn’t have a specific link attached. Rather, it is that over and over insiders and a few analysts keep mentioning in passing that the reason XBox Games is in the shitter is because they gave away some specific title FOR FREE through XBox Game Pass. I even saw a comment comparing XBox Game Pass users to software piracy, and if I could find that quote again I would 100% included it and underline it 17 times and draw a boarder of flames around it as a warning to others because NO IT FUCKING ISN’T. That is UbiSoft levels of customer contempt right there. XBox Game Pass might not have been a good idea. In fact, it probably wasn’t a good idea. It was a blatant attempt by Micrsosoft to become the Spoifty of video games, Spotify famously being incredibly profitable for its owners and absolute shit for actual musicians. Except, of course, in this case Microsoft owned many of the studios it was looking to short change. Microsoft XBox Game Pass was an attempt by Microsoft to cheat itself out of money. And then, when the inevitable economic of the situation took hold, they declared the studios were not profitable enough and laid a ton of people off… people who were making the games that made Game Pass viable in the first place. This is some economic Nobel Prize levels of incompetence. Is XBox Games For Sale? WCCFTech – Microsoft Weighs Xbox Spinoff Games Industry.biz – Xbox is (probably) not for sale Another vibe going around for a bit is that all of this is an attempt by Microsoft to ready its video games division to be spun off or sold off to another company. All of these layoffs and closures, that is the sort of thing you do because you either think it is the only way you can right the ship and carry on or because you want to clear the books and ride on economic inertia for a while in order to dupe some competitor or investors into thinking they should buy the whole thing. It is honestly probably the former, if only because who is left that is large enough to buy them? Also, if you were going to try to sell you would ditch the hardware portion of the business first because the capital needed to maintain hardware production… well, I worked on a lot of hardware projects in the 90s and it ain’t great. VCs and banks and everybody with money hates that business. But they could still spin the whole thing off into a stand alone business. Trim it down, saddle it with some AI debt, retain a bunch of the IP licenses to it has to keep paying into the mothership, and let it go. Something else to keep an eye on. Play Original XBox Games on Windows PCs XBox – XBOX Backward Compatibility on PC Ars Technica – Microsoft brings original Xbox backward compatibility to Windows PCs Finally, I am going to end this on a bit of an up note… maybe. XBox is working on bringing some titles from the original XBox console to the PC. This is good… both for gamers and probably for the XBox bottom line as they can farm nostalgia and sell twenty year old titles back to the people who played the original hardware. So far only four titles are on the list: BLiNX: The Time Sweeper Conker: Live and Reloaded Crimson Skies: High Road to Revenge Fuzion Frenzy But even I remember Crimson Skies from back in the day! The cost to implement this should not be too high. They are doing this through an emulation layer… we’re only talking about stuff that ran on a Pentium III here and 64MB of RAM… so they have a lot of headspace on current PCs (or even decade old PCs)… and work on getting the initial titles out will apply to others. The question is what will they feel is worth porting over and what gets left behind? Transitions between formats always has a filter effect. Not everything on film made it to VHS, and only a subset of titles on VHS made it to DVD, and so on. So there will be titles deemed to be not worth the effort. And then there is ownership. These first four titles are all from studios owned by Microsoft, so there are no messy licensing or revenue agreements to deal with. Now, a lot of the titles on the platform were first party, but there are some third party titles on the best sellers list that we probably won’t see updated. And that is it. I could probably find more to be angry about. But we’ll get into being angry tomorrow.