The Verge interviews Phil Spencer - ‘The business isn’t how many consoles you sell’

Oct 29, 2017
170
Surprised so many people are wondering about the Lockhart. The Xcloud can be lockhart at this point or the X will be likely 300 by the time the Scarlett comes out
 

Fisty

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Oct 25, 2017
4,015
This is what makes money. Sony may sell more consoles but when it comes to online and paid subscriptions, they're toast. Xbox is now an ecosystem. No way to compete with that.
Well Sony must have found a way because the Playstation Network makes more money than the entire Xbox division, not to mention having way more PS+ subs than Xbox has Gold subs
 

Freakzilla

Member
Oct 31, 2017
3,295
Yup. If it was dead, he'd have just said we're only making one console right now. He said they're only talking about one. Obviously he doesn't want to spread confusion in the initial message with people talking about a cheap and low-powered console when he's trying to sell the next big thing.
Why are so many people worried about Lockhart?

Sony is Toast? Some you the posts here are out to lunch. Playstation is also an ecosystem. Sony will be more then fine World wide. Sony makes more money has more users and sells more hardware...the two are not mutually exclusive.
Maybe not toast now, but in the years to come if they don't do something about the subscription stuff. Xbox ecosystem is now on PC. You won't even need to own an Xbox to give MS money for the operating system and for games.
 

Sonicfan059

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Mar 4, 2018
1,960
Remember when gaming companies didn’t force feed you tons of subscriptions? When online was free? Now on top of paying for online they offer tons of other subscriptions you don’t need.
 

dotyoureyes

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Jun 11, 2019
488
Why so

Maybe not toast now, but in the years to come if they don't do something about the subscription stuff. Xbox ecosystem is now on PC. You won't even need to own an Xbox to give MS money for the operating system and for games.
Ps now is on PC already..Sony has zero to worry about world wide. People in europe are not going to abandon PS ecosystem for Streaming or Xbox games on PC. What do they "NEED" to do? People will go where the content is. Sony has that. Ms doesn;t get near the money from buying games on Windows as xbox, especially ones on Steam. Barely anyone is buying xbox games on Windows store in any meaningful numbers.
 
Jan 15, 2018
95
I don't think sony see selling hardware as there main business either. Games are where the money is at and MS is nowhere close to sonys quality output and nothing I've seen at E3 is going to change that.

Eventually they are going to have to stop subsidising gamepass and only then we will see if their service is worth it to consumers, any subscribers numbers we see now i expect to drop hugely once the cost will go up.
That i dont agree with. MS puts in quality games and has shown some Halo infinite visuals are great. Forza has great visuals, as does gears of war. Sony has naughty dog though and they excel at quality, but we havent see anything from a number of studiod ms owns just yet.
 
Jun 7, 2019
195
MS is no longer worried about Sony, and especially not Nintendo. They are worried about Amazon, Google, etc ... The entire company is - not just the games division. Sony and Nintendo are a drop in the bucket compared to a tech giant like Google
 
Oct 25, 2017
2,129
This is what makes money. Sony may sell more consoles but when it comes to online and paid subscriptions, they're toast. Xbox is now an ecosystem. No way to compete with that.
You need to sell consoles in order to paywall online access from its software. Nobody subscribes to Live Gold or PS Plus because it offers good value. They subscribe because they're forced to do so to access online.

You can't do this on another platform. Xbox Live enabled games on Switch require Nintendo Switch Online, not Xbox Live Gold, and on PC they require no sub at all.
 

Travaughn

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Oct 27, 2017
1,950
I understand what Phil's saying and largely agree with him but wouldn't a larger number of consoles sold imply that there's a larger number of people that you can potentially sell your services to? It's not necessarily about being the best selling,but I feel that the importance of selling consoles is being undersold here. Otherwise, what is the point of selling Xboxes,why not just focus squarely on xcloud and gamepass?
 

alstrike

Member
Aug 27, 2018
365
What made them embrace this approach I wonder... I bet if they were at almost 100 million units sold the tune they'd sing would be completely different.
 

Jar0d

Persona Of Interest
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Jun 11, 2019
41
Hardware is what exposes consumers to your specific services and accessories though. If you remove hardware from the equation why would someone choose Xbox 'services' over competitive offerings? Sony and Nintendo have much stronger IP and multiple companies already offer or will offer streaming services and game subscriptions.
Replace Xbox by Windows and you pretty much answer your question yourself.

You don't need an in-house hardware to sell shit tons of software and accessories, you just need an hardware, not mandatory to be your own. Phil Spencer is perfectly right here, it's all about making money.
 

chezzymann

Member
Oct 25, 2017
2,494
Remember when gaming companies didn’t force feed you tons of subscriptions? When online was free? Now on top of paying for online they offer tons of other subscriptions you don’t need.
Guaranteed extra money. If you just paid $60 for one game and played it online for free for the whole year that's not enough for them.
 
Oct 29, 2017
170
With millions of playstation owners buying GOW, SPIDERMAN,UNCHARTED,HORIZON, Ratchet etc they are going to stick with the console that has those games. Playstation this whole gen has driven home that their investment for over 3 generations has gone to good use.

I don't see people jumping ship because they can play halo, forza, battletoads for month of gamepass they paid $1 for.
Think the beauty of 2019-20 is you don't really have to jump ship . With Xcloud and and a sub you can play those games, or you can play them on your rig or buy a Xbox .
 

dotyoureyes

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Jun 11, 2019
488
Replace Xbox by Windows and you pretty much answer your question yourself.

You don't need an in-house hardware to sell shit tons of software and accessories, you just need an hardware, not mandatory to be your own. Phil Spencer is perfectly right here, it's all about making money.
The most money comes from selling hardware right now......see playstation division profits. MS is not making near the same amount from Windows, especially now their games are starting to come to steam.
 

Freakzilla

Member
Oct 31, 2017
3,295
MS is no longer worried about Sony, and especially not Nintendo. They are worried about Amazon, Google, etc ... The entire company is - not just the games division. Sony and Nintendo are a drop in the bucket compared to a tech giant like Google
Seriously this is what people aren't understanding. Sony and Nintendo are like toy companies compared to MS. Xbox is not just the game division it's the cloud among other things.
 
Oct 25, 2017
2,129
Replace Xbox by Windows and you pretty much answer your question yourself.

You don't need an in-house hardware to sell shit tons of software and accessories, you just need an hardware, not mandatory to be your own. Phil Spencer is perfectly right here, it's all about making money.
You DO need in-house hardware in order to implement the biggest money-maker in console business, which is the online play paywall.
 

dotyoureyes

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Jun 11, 2019
488
Phil knows.

Software and services are the money makers.

Most hardware is sold at a loss or break-even.
The point is the most services/subs come from buying the hardware..it's why PS division made as much as Nintendo and Xbox combined... If the hardware did not matter MS would not be spending billions in R and D on the next box. Phil would be saying something different if they were near 100 million sold.
 

Prine

Member
Oct 25, 2017
5,142
What made them embrace this approach I wonder... I bet if they were at almost 100 million units sold the tune they'd sing would be completely different.
Doubtful, that isnt a high enough number, Netflix has 150 million subs, presumably MS want to go into 200+ mill and that cant happen with single branded powerful console. PC+Xbox+Phones+Old hardware is the long game they're looking to play.
 

Freakzilla

Member
Oct 31, 2017
3,295
It appears that you are mistaken. Playstation division makes more money than Xbox + Nintendo combined.
Sony and Nintendo on the whole makes WAY less than MS. Xbox is just their ecosystem division with cloud etc.
Sony is toast even though they're likely doubling or tripling Xbox in revenue...
Yeah Xbox vs PlayStation but Xbox isn't just a console for MS. It's their ecosystem and cloud service going up against Google and Amazon.
 

dotyoureyes

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Jun 11, 2019
488
Sony and Nintendo on the whole makes WAY less than MS. Xbox is just their ecosystem division with cloud etc.

Yeah Xbox vs PlayStation but Xbox isn't just a console for MS. It's their ecosystem and cloud service going up against Google and Amazon.
No one is saying they make more then MS as a whole lol. The PS division makes way m,ore then xbox and nearly more then Xbox and nintendo combined. They did this buy selling hardware. Most of MS subs are from...selling hardware,.
 

metalgear89

Member
Oct 27, 2017
634
That i dont agree with. MS puts in quality games and has shown some Halo infinite visuals are great. Forza has great visuals, as does gears of war. Sony has naughty dog though and they excel at quality, but we havent see anything from a number of studiod ms owns just yet.
Visuals is not a good indicator of quality. Halo and gears are not relevant anymore and their last releases where meh. I'm of the opinion why we haven't seen any significant gameplay for both is because they really can't take the franchises any further. Forza I think is the only decent one.

We have been hearing for years to wait for ms owned studios to put out quality and it hasn't really happened, and I don't see anything from their recent conference that show that will change. They came out saying they our going to put out exclusives game every few months seems like they are not interested in quality rather quantity.
 

Fredrik

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Oct 27, 2017
3,433
So xCloud will have regular 1tf Xbox One motherboards?

And Stadia will have 11tf stackable Stadia boxes?
 

Lukas Taves

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Oct 28, 2017
4,321
Brazil
I don’t even know why it needs to be asked. like the only way they could be clearer about their direction is if they hit you with a sledgehammer in your face.
So it still looks like Lockhart is dead
Sounds indeed like Lockhart is dead (for now).
How did you guys got that impression? For me he is quite clearly making the distinction he decided to talk only about the most powerful one at e3, and having nothing else to announce now.

In other words lockhart does not exist at this moment only at a PR standpoint
 

Parenegade

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Oct 25, 2017
2,812
If this is true it seems like Stadia could have a major leg up on xCloud. It's not tied to a specific hardware specification so they can consistently upgrade it and keep it bleeding edge.
 

TheGhost

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Oct 25, 2017
12,476
Long Island
You can't sell it but used gamepass subscriptions, makes sense and something I've been saying for months now here.

The "war" of systems sold is over.
If they have people subbed to game pass they are good to go. The battle will be won with subscriptions

I just downloaded 4 games last night I would never spend money on and enjoyed loving. Works as intended.
 

dotyoureyes

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Jun 11, 2019
488
Xbox is not just a game division. It's where the platform to creat things like a cloud and paid subscriptions.
It is still a fullt seperate division with it's own budget, revenues...same as PS division. PS is still a part of sony, does;t change the fact it is still a seperate divison with its own mandate,
 

Lokimaster

Member
May 12, 2019
104
Yea when you are selling the least amount of consoles you dont get to dictate this type of thing. Especially when the competition is beating them in console sales, and software/services.
 

dotyoureyes

Alt Account
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Jun 11, 2019
488
Not as separate as PlayStation is for Sony. Xbox for MS is a whole ecosystem.
How do you even know this? What inner workings of either company do you have? Fact is Ps4 revenue doubles Xbox due to hardware sold..that's a fact. MS even has it has a seperate divison lol. It is a seperate division with its own mandate, budget, anything else is just noise.

MS even seperates gaming from the rest for a reason.
 

Netherscourge

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Oct 25, 2017
8,012
The point is the most services/subs come from buying the hardware..it's why PS division made as much as Nintendo and Xbox combined... If the hardware did not matter MS would not be spending billions in R and D on the next box. Phil would be saying something different if they were near 100 million sold.

It matters, but it doesn't make as much money for Microsoft as it does for Sony.

Hardware sales have been crucial for Sony's success.

Software, services and cross-platforming with PC (and soon smartphones and other mobile and/or living room devices) have been crucial for Microsoft's success.

I would argue that Sony NEEDS to make a superior high-end console for their PS5 in order to stay successful. Microsoft simply needs to expand to more platforms and keep up with support and compatibility across the board with the latest titles.