July 13th 2024.
Is Xbox facing the consequences of its high-priced decisions? As a reader, I am not surprised by the recent rumors surrounding Xbox and its acquisition of Activision Blizzard. In fact, I argue that the cost of this purchase has been much higher than even Microsoft could have anticipated.
It is often said that money cannot buy love, and it seems that this is true for Xbox. Despite spending over $76 billion in the past few years to acquire Activision Blizzard, Bethesda, and other developers, their hardware sales have not seen a significant increase. In fact, reports suggest that Xbox may be giving up on promoting their consoles in Europe and instead focusing on Game Pass and cloud gaming due to poor sales.
Some may argue that Xbox's revenue has increased due to the success of Activision Blizzard's games, such as Call of Duty. However, it is important to note that Xbox had to spend a whopping $69 billion to acquire these games, meaning they must make that much in profit just to break even. This will likely take many years, even with the success of Call of Duty, and puts Xbox in a precarious financial position.
I am surprised that higher-ups at Microsoft even agreed to this purchase. Presumably, Phil Spencer and others had to present detailed explanations and predictions of what they believed would happen. Yet, it seems that ever since the acquisition, Xbox has been making sudden and seemingly knee-jerk reactions. They change their plans frequently, with reports of internal disagreements over multi-platform releases, which were not originally part of the plan.
When Xbox first acquired Bethesda, it was announced that all future games would be exclusive to Xbox. However, just a few months later, after purchasing Activision Blizzard, there was a sudden panic and now there are talks of multi-platform releases and job losses. This seems like a last-minute decision rather than a well-thought-out plan.
All of these sudden changes give the impression that the top executives at Microsoft were not paying attention when the purchase was made. It seems that they only now realize the true financial consequences and are scrambling to make up for it. This also explains their recent complaints about a lack of growth and the need to expand their audience, all while Xbox sales continue to decline globally.
Microsoft may now be one of the biggest video game companies, but at what cost? Their console sales have plummeted and it seems they are content to let the current generation of consoles fade away and be forgotten. Their biggest money-maker, Call of Duty, was already multi-platform and remains so. So, what has Xbox gained from all of this? It seems that they have simply become Activision Blizzard in all but name, with their only unique offering being cloud gaming.
I believe the rumors of a "civil war" at Xbox, between those who wanted to keep things exclusive and those who did not. I assume the latter group is not concerned with hardware sales and is happy for Xbox to become solely a service, even though Game Pass has not been as successful as hoped.
As a fan, I miss the days of the Xbox 360, when it had a clear identity and stood out from its competitors. It was the young challenger, outselling Nintendo on its first try and giving PlayStation a run for its money. Now, it seems that Xbox is constantly dealing with negative headlines and struggling to find its footing. They may have a successful summer showcase, but it is quickly overshadowed by their ongoing struggles.
I do not see any remnants of the old Xbox in the current company. Instead, it feels like they are willing to do anything for a quick profit, only to change their plans soon after. All of this spending has resulted in nothing but a loss of direction and identity. The soul of Xbox has been extinguished, leaving behind only the empty shell of Activision Blizzard.
As a reader, I am left wondering about the future of Xbox. Will they continue to make costly decisions, or will they learn from their mistakes and regain their unique identity? Only time will tell.
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