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Phil Spencer: "If this is not the year when a family wants to make a decision to buy a new Xbox, that's OK"

pswii60

pswii60

Member
Oct 27, 2017
26,670
The Milky Way
This BBC interview discusses how Microsoft is tailoring their launch plans to the pandemic. Some interesting nuggets here, as it further cements their focus on services in the current climate ("our strategy does not revolve around how many Xboxes I sell this year" - would have made for a clickbait title), and also sounds like a they'll have a bigger focus on the Xbox All Access subscription.
It looks like we're moving into a period of of massive economic uncertainty. The thing I'm probably focused on the most is the macro-economic environment. We see the impact of people getting furloughed and layoffs. It's tough. And we are a leisure activity. We're not a requirement. We're not food. We're not shelter. So we want to be really tuned in to that as we launch. How can we make it as affordable as possible? How can we give buyers choice?
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So we want to be really tuned in to that as we launch. How can we make it as affordable as possible? How can we give buyers choice?

We've got an Xbox All Access subscription programme that allows people to buy their next console by paying a monthly charge. And if now is not the time for you to buy a new console, and you're going to stay with the console you have, we're going to keep supporting that console.
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But our strategy is centred around the player, not the device. If this is not the year when a family wants to make a decision to buy a new Xbox, that's OK. Our strategy does not revolve around how many Xboxes I sell this year.

We're focused on delivering services through Xbox Game Pass, which allows people to build their library for a monthly fee. Backward compatibility means that the console that they have will play thousands and thousands of games. Smart delivery means when they move to the next generation, the games will move with them.
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www.bbc.co.uk

Xbox Series X: Microsoft tailors launch plans for the pandemic

Xbox chief Phil Spencer explains how coronavirus has affected the console's release strategy.
www.bbc.co.uk
 
Dunlop

Dunlop

Member
Oct 25, 2017
8,477
Of course they want the numbers, but honestly it is a great strategy when PS5 smokes them out of the gate in sales. Gamepass is a fantastic service that I hope keeps growing
 
Mendrox

Mendrox

Banned
Oct 26, 2017
9,439
ItsBobbyDarin said:
Is gamepass really that big, that Microsoft says meh at next-gen console sales numbers?
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It's great to see Microsoft saying this, but do they really make enough money with Gamepass? With all those monthly deals I can't see them getting enough money so far, but I could be wrong of course. It's just looking at the deals online and having done 2 years for 20€ myself.... I can't see it being worth it. Someone will have to suffer in the future. Still if they manage that and also publishers get enough money through Gamepass then it will be fine.
 
m23

m23

Member
Oct 25, 2017
5,417
I'm wondering if All Access will make its way to Canada for launch, will be a very attractive proposition.
 
Tora

Tora

The Enlightened Wise Ones
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Jun 17, 2018
8,639
"How can we make it as affordable as possible? How can we give buyers choice? "

Lockhart? All access program? I wonder if it's just that
 
playXray

playXray

Chicken Chaser
Member
Oct 27, 2017
614
UK
Seems a bit more positive than "We have a product for that, it's called Xbox 360" at least!

Seems MS is going all out on the whole 'Netflix of gaming' thing, which I think is good for new players at least. Me, I have such a big backlog that it would be insane to add a subscription service on top of this. Plus I probably own all the best games on it already cos I can't help myself!
 
flaxknuckles

flaxknuckles

Member
Oct 25, 2017
4,311
Mendrox said:
It's great to see Microsoft saying this, but do they really make enough money with Gamepass? With all those monthly deals I can't see them getting enough money so far, but I could be wrong of course. It's just looking at the deals online and having done 2 years for 20€ myself.... I can't see it being worth it. Someone will have to suffer in the future. Still if they manage that and also publishers get enough money through Gamepass then it will be fine.
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When all those people who stacked months and years worth of Gamepass Ultimate convert to monthly payers (probably without realizing) then Microsoft will be flush with dough.
 
Dunlop

Dunlop

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Oct 25, 2017
8,477
m23 said:
I'm wondering if All Access will make its way to Canada for launch, will be a very attractive proposition.
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For the first time in decades I won't be getting the new consoles, I'm starting off the Gen with my PS4, hopefully xCloud having the Gamepass library, GFN and Stadia. If this came to Canada I might bite.
 
jett

jett

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Oct 25, 2017
44,656
Phil Spencer has such a great outlook for this industry.
 
Heynongman!

Heynongman!

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Oct 25, 2017
8,928
I feel like the first year being crossgen will work out in Microsoft's favor more so than it would have given the current economic climate. Sales on new consoles may be very slow if things don't pick up - and even if they do people are still going to prioritize needs while we get back into the swing.
 
IzzyRX

IzzyRX

Avenger
Oct 28, 2017
5,816
They're taking the same approach Apple did although for different reasons, but I think it will pay off in the long run.
Entangle your customers on the Xbox ecosystem and they won't leave that easily.
 
freakybj

freakybj

Member
Oct 26, 2017
1,428
I wonder how xcloud will be deployed. Haven't heard much news on that lately. With Xcloud, I assume they will be launching all their 1st party games there so you wouldn't need PC or console?
 
Dunlop

Dunlop

Member
Oct 25, 2017
8,477
Heynongman! said:
I feel like the first year being crossgen will work out in Microsoft's favor more so than it would have given the current economic climate. Sales on new consoles may be very slow if things don't pick up - and even if they do people are still going to prioritize needs while we get back into the swing.
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Initially the sales will be strong for both platforms as it is heavy loaded with hardcore gamer sales, I think 6 months in will be an indication of how next gen is faring
 
The Albatross

The Albatross

Member
Oct 25, 2017
39,020
If the pandemic/recession hit in late 2019 rather than Q1/Q2 2020, I think they would have delayed the launch of the consoles. One reason the 360/PS3 gen lasted so long was because the 2008 recession slowed down planning for the next set of consoles, and they didn't launch until the US, Europe, and elsewhere had pulled out of the double-dip.

With 40 million Americans out of work, Microsoft's largest customer base, there's going to be a lag in recreational consumer spending. They're going to have to get revenue from services.
 
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pswii60

pswii60

Member
Oct 27, 2017
26,670
The Milky Way
MJKadhim said:
i really dont like what he said ..
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Which part?

About understanding the harsh realities faced by families in the current climate?

About trying to make the new generation more affordable?

About supporting those who can't afford to upgrade to the new console(s) with games on their existing console and Game Pass subscription?
Grunge_Hamster said:
That title on this thread would have attracted so many hot takes on page 1 :v
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It was tempting, trust me. But thought we'd had enough hottakes this year and not sure we need any more.
 
Kopite

Kopite

Member
Oct 28, 2017
6,020
Well that's their focus and strategy and I think it's good as it's a fairly different alternative to Sony and Nintendo's approach. It also finally negates the need to buy multiple consoles to play 2-3 more games.
 
Dan Thunder

Dan Thunder

Member
Nov 2, 2017
14,048
Mendrox said:
It's great to see Microsoft saying this, but do they really make enough money with Gamepass? With all those monthly deals I can't see them getting enough money so far, but I could be wrong of course. It's just looking at the deals online and having done 2 years for 20€ myself.... I can't see it being worth it. Someone will have to suffer in the future. Still if they manage that and also publishers get enough money through Gamepass then it will be fine.
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I wonder this as well. I got an XB1 purely because of GamePass. I grab a couple when there's a deal so I usually get around 6 months of Ultimate for just over £30. However, none of this has transferred to me buying any games for the system. I got Division 2 & Battlefield V as part of the bundle when I got the console but aside from those I've not deviated from GamePass at all.

Even if I paid the £10pm for GP Ultimate that's still only £120pa - and that includes XBL Gold in the price. I can't imagine there's much profit to be had from me as a gamer?
 
Dekuman

Dekuman

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Oct 27, 2017
19,026
I assume price will be higher than expect and units may not be that plentiful? There seems to be an admission it won't be designed as a massive blowout launch.
 

Deleted member 45130

Banned
Jun 17, 2018
3,244
Phil Spencer is a great guy and knows what he is doing. Games pass is fantastic value and will keep being great even if people don't pick up the Series X.

I do feel like the price of Series X could be higher than some on here believe, based on what he says in the interview. Die hards will still get one I'm sure but now I'm a bit more convinced that it will be between £549-599.

The next couple months will be interesting though, that's for sure.
 
LavitzSlambert

LavitzSlambert

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Nov 8, 2017
845
Microsoft under Nadella has been shifting their strategy for years to services, Xbox has followed suit so far and will continue to. It's proven time and time again that software and ecosystem drives purchase of hardware, not the other way around. With digital purchases on the rise, people are increasingly being locked in to one platform or another. Game Pass is Microsoft's entry into the living room, it's their greatest strength. They're not going to rely on selling an expensive console and starting from scratch to build a user base.

Game Pass users will buy Xbox hardware, and people who want Game Pass will buy Xbox hardware. The All Access Pass is making that second part easier. Their answer to people who can't/won't do the above is Apple's model of "last year's" box or a cheaper solution.
 
Thera

Thera

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Feb 28, 2019
12,876
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I like Phil, I really do. It is one of the best thing that happened to this industry lately.

But please, don't use the pandemic to give a sense to your strategy decision and that it affected the launch. That's wrong and bad taste.

EDIT : Change the word "political" by "strategy"
 
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christocolus

christocolus

Member
Oct 27, 2017
14,932
It looks like we're moving into a period of of massive economic uncertainty. The thing I'm probably focused on the most is the macro-economic environment. We see the impact of people getting furloughed and layoffs. It's tough. And we are a leisure activity. We're not a requirement. We're not food. We're not shelter. So we want to be really tuned in to that as we launch. How can we make it as affordable as possible? How can we give buyers choice?
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Interesting quote.. really nice interview. I hope they keep pushing GP and All Access. Lockhart would be great value too.
shinobi602 said:
Yup, expect All Access to be pushed heavily this year.
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nice as they probably should.
 

Deleted member 30681

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Nov 4, 2017
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This also feels like a psudo confirmation of Lockhart to me, if MS is aware of the grim economic realities of folks and tailoring things to that reality.

Love this strategy.
 
Mr.Deadshot

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Oct 27, 2017
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They just try what works for them in the business division with their gaming division. It makes sense because subscriptions are more popular than ever.
 

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playXray said:
Seems a bit more positive than "We have a product for that, it's called Xbox 360" at least!

Seems MS is going all out on the whole 'Netflix of gaming' thing, which I think is good for new players at least. Me, I have such a big backlog that it would be insane to add a subscription service on top of this. Plus I probably own all the best games on it already cos I can't help myself!
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Yeah, but people like you aren't the majority. And I don't just mean in developed countries. Look at most developing countries. Like India or Vietnam. India has a massive population of young people, and they enjoy playing games. Problem is that they can't afford a lot of games. Many of them can't even afford good hardware to play those games. So a Gamepass + XCloud kind of subscription streaming service will explode in these countries.

Microsoft will be opening up markets that have traditionally been very low profit because most Indians don't have the money to buy expensive consoles. And once they are entrenched in these markets, new competing services will have no chance. Imagine your entire game library and saves are on gamepass. As are your friends. Will you migrate to a new service only to leave all of that? No chance.

For Microsoft as a company and for billions of low-income players, this is going to be phenomenal. What I worry about is that this might spell the eventual end of game ownership. I don't really like that, to be honest, even though I'm super excited about Xcloud coming to India.
 
Pryme

Pryme

Member
Aug 23, 2018
8,164
Dan Thunder said:
I wonder this as well. I got an XB1 purely because of GamePass. I grab a couple when there's a deal so I usually get around 6 months of Ultimate for just over £30. However, none of this has transferred to me buying any games for the system. I got Division 2 & Battlefield V as part of the bundle when I got the console but aside from those I've not deviated from GamePass at all.

Even if I paid the £10pm for GP Ultimate that's still only £120pa - and that includes XBL Gold in the price. I can't imagine there's much profit to be had from me as a gamer?
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Without Gamepass, they'd have had zero profit from you as a gamer.
 
jon bones

jon bones

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Oct 25, 2017
26,019
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Thera said:
I like Phil, I really do. It is one of the best thing that happened to this industry lately.

But please, don't use the pandemic to give a sense to your political decision and that it affected the launch. That's wrong and bad taste.
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was waiting for this thread to turn really crazy - please tell us what this means
 

Deleted member 2791

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Thera said:
I like Phil, I really do. It is one of the best thing that happened to this industry lately.

But please, don't use the pandemic to give a sense to your political decision and that it affected the launch. That's wrong and bad taste.
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???
obviously companies have to adapt their strategies and expectations around the global pandemic that disrupted the global market?
 
scitek

scitek

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Oct 27, 2017
10,070
ItsBobbyDarin said:
Is gamepass really that big, that Microsoft says meh at next-gen console sales numbers?
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I guarantee under normal circumstances, they would be making it a point to push their new hardware at all costs, but with so many people out of work, it's a better look to say things like this and show you're not completely out of touch.

Also, they've been more concerned with subscriptions than SKU sales for years.
 
dancingphlower

dancingphlower

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Oct 27, 2017
12,058
It's been really interesting to see the trajectory that Xbox has been on since the beginning of the generation until now. Would be great to see each of the big three all do their own thing in the console space.
 
Era Uma Vez

Era Uma Vez

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Feb 5, 2020
3,210
Sounds like he's taking the same approach to Series X as he did with XBox One X.
Trying to see it more a like a hardcore product for enthusiasts, rather than the natural next-step for gamers.
 
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