So, one of the biggest conclusions I've seen game pundits and gamers say is that Microsoft's press conference was solid and had lots of great games, but, since it didn't give people much reason to buy a X1X, with timed exclusives eventually going to PS4 and most of the games being available on PC, it was overall a failure to do what they needed to do, i.e., sell gamers on the X1X.

Here's why I think that's wrong. Kinda.

While I think a reasonable number of people will be interested in buying an X1X or at least an X1S, be it for backwards compatibility, be it because they don't like PCs (heathens), be it because they like PCs but hate Windows 10 (more on this later), it is, however, safe to assume that the XBOX's install base won't probably grow that much. But here's why I don't think that's a failure for Microsoft:

They are not playing the same game as Sony.

Sony's strategy is basically "good and easy to develop hardware and a big library of good exclusives to push console sales". That has worked to an amazing degree especially compared with the XBOX, 60M of the former to ~26M of the latter(1). So, how can Microsoft turn the tide and win against Sony? Well, they can't. Not in the console selling business. It's too late in this generation to see a turning tide. So the solution is just to pivot, and play a different game entirely.

I think that, while selling consoles is important, that's a secondary goal to Microsoft. I think their primary goal is to sell gamers on the service, so they'll want to play the games sold in the XBOX marketplace. A lot of people who are "throwing shade" are saying "Why would I buy the console if I can play it on PC?" to which the Microsoft answer would be "Please do! Be sure to install Windows 10, though."

See, I think the two major goals of Microsoft are: to increase Windows 10 OS market share and to create a marketplace that can eventually be competitive with Steam (maybe a pipe dream, maybe not.).

Since I don't know much about the viability of the latter, let's talk about the former.

According to this site, for almost an year the Windows 10 has been stagnant in the with between a fifth and a fourth of the market with no considerable growth in the last months, while Windows 7 market share has stayed solidly at about 50% for the last 2 years at least.

Therefore, all they need to do to achieve at least one goal is to sell people on the games. If they do that, they gain market share either on the console side or in the OS side, while also pushing their marketplace.

So, "bad" for xbox owners, because upping the install base and increasing community size doesn't seem to be the sole priority; good for Microsoft because it's a two pronged and flexible business strategy and good for general gamers (I think), since it increases choice and freedom of where to play games.

So what do you think? Makes sense? Crazy conspiracy?

I can't believe the acronym for their new Xbox is XBOX.

You just blew my mind...

Sony sells roughly 1 million consoles per month WW the Pro is 20% thats 200k with 60% being new customers the Pro is expanding Sony's userbase.

The 1X could have done the same if priced right, but the 1X failing to sell won't make it a failure MS simply can't go into the next generation with a rep games run worse on Xbox revitalizing the brand is enough to justify the 1X.

Horizon is critically acclaimed brand new IP that sold fantastic both being the exception not the rule taking six years to develop even if MS was to bring the games not only would it take great cost it wouldn't see the light of day until well into the new generation, the 1X is a quick fix and the easier option.

MS have been closing studio's cancelling games pulling out of expensive third party marketing deals in an effect to increase profitability MS already makes more from each user than Sony adding Game Pass alongside EA access makes clear the direction MS is going their not competing with Sony and haven't for awhile, we have three platforms all moving in different directions.

Every game released on the Windows Store so far has failed moving the needle in anyway, as long as the one size fits all approach exists on the Windows Store the PC crowd will never buy into it.

This is completely irrelevant data as it includes all PCs even decade old office computers. Your average company is not tech smart, they won't upgrade OS until they suffer a hack or buy new computers that already have a newer OS on them.

Windows 10 would have a much larger percentage if this data was based on gaming PCs. I would not recommend Windows 7 anymore, it runs worse in gaming and non-gaming ways, it doesn't have DX12 and updates are on life support.

I would imagine Windows 10 is somewhat stagnant because the biggest push would have come when they were prompting people to upgrade for free, again though, if this was a more specific chart 10 would be moving around more. The chart is skewed by too many generic office computers.

Good post, and it's largely spot-on. Phil Spencer alluded to exactly this as their strategy in an interview a while back. Microsoft doesn't care if you're playing, say, Forza 7 on Xbox One S, One X, or on PC. They're happy as long as you're playing in their ecosystem.

I disagree that it's bad for Xbox owners. X1X wouldn't exist if they weren't efforting to unify PC/console gaming a bit, and it gives Xbox owners more options as to how they want to game. If I want to step up to X1X or PC, that transition has gotten a whole lot easier knowing that many games/saves will carry over.

I've bought into this ecosystem, but what a bunch of people who seem to think they're "outsmarting" MS by buying Xbox games on PC don't seem to realize is that they're buying in, too. MS is combining their presence in the PC and console space, and it's a great long-term strategy that Sony and even the Steam juggernaut can't bring to the table, which could very well make MS uniquely well-positioned and competitive down the road.

@wynnduffy: Are you basing this on a source and data or is that your opinion?

@notnert427: That's kind of why I put the word bad under quotes.

I kind of had the same conclusion last year when they first started getting into the "Windows 10 gaming" terminology. I would go so far as to say the future of the Xbox brand isn't consoles, but rather existing as a digital marketplace accessible on PC, phones, and tablets. Then again, I'm also in the camp that loves consoles but doesn't see a promising future for them when compared to the growth of PC, phones, and tablets.

I think you can even see some of that PC fusion in the way they are marketing the X1. Going into specifics with hardware and pushing power while not really making an effort to differentiate the console from PCs, because it's in their best interest for their player base to want (and own) both.

Honestly, it's probably the smartest approach to take. Microsoft absolutely should take advantage of being the Windows company, even if it means sacrificing some of the "Xbox community".

@mindbullet: MS have roughly 30 million console owners that generate billions in revenue who want nothing to do with PC gaming, despite all the flack MS got the XB1 sold out its first year spending and engagement increases every year Xbox has a core audience that really like the brand.

Here's what I think the next full on XBox should be:

Part Valve Steambox, part Nintendo Switch.

Okay, okay, hold on, hold on, and just bare with me here...

One of the reasons that the Steambox isn't all that successful is that there is absolutely no reason to use it over Windows as an OS. With Steambox you get a gimped up version of Linux that is really just for gaming with a limited software library. With Windows, you get a full Windows experience being able use your system for video games, and everything else that you use a PC for.

Now Microsoft is heavily going for their "play anywhere" theme that lets you play their games either on Xbox or PC, so what if the next system was a heavily themed full on version of Windows 10 that you can take with you from room to room.

Imagine the hardware taking inspiration from the Switch, and being an Xbox system that you're able to dock with a television, and then grab the system to bring to your desk in order to dock it with your monitor and k/m setup? I'd imagine the high cost system bundle being an Xbox console, a controller, two docks, a keyboard, and a mouse. A low cost bundle would just be the dock, console, and a controller.

You'd have the advantage of a system being able to run Xbox games well due to standardized system hardware, but also let you use it with anything that a Windows system could do. You could use it in the living room for that sit down on the couch experience with games or media, and then move it to a desk when you're wanting a desktop k/m experience, or if you're wanting to do something besides gaming with productivity software or whatever.

Obviously the OS would need to be themed in such a way that it's easy to navigate with a controller as well as be a full version of Windows 10, and they'd have to fix their horrible digital store Windows experience.

@johnny_sailor: We have no evidence that anyone buys anything from the Windows Store, portables do far worse in the west than east I can't imagine you average COD, Madden and FIFA PS4/XB1 player cares about the Switch or portability in general theirs a good resaon Nintendo lacks third party support.

I think this is backwards. Microsoft IS Windows and related software (as well as cloud services.) Xbox is a small side business that has never been particularly profitable. They're not taking advantage of being the Windows company to serve Xbox, they're taking advantage of Xbox to serve Windows, which is their actual main business.

Android/IOS is becoming more and more of a viable competitor to Windows for consumers who just need basic functions like email and Netflix. Computer sales dropped while phone and tablet sales took off (though that leveled off some) and many kids these days grow up only using computers at school.

Gaming is a way to make Windows more valuable as a home product, and to introduce kids to the OS and grow the next generation of Windows users. Xbox is MUCH more valuable to Microsoft as an aspect of Windows that draws consumers into the ecosystem than as a separate business that generates moderate profits, if that.

Xbox and Windows integration is inevitable. I think under Phil Spencer it will be relatively painless for gamers and maybe even a good thing, but it just makes sense.

Sony is worth about 45 billion dollars. Microsoft is worth about 544 billion. They're just totally different businesses with different needs, and while Sony relies on Playstation revenue to drive the company Xbox is just not that for Microsoft, and they don't think about the division in the same way.

@thepanzini: Yeah, I'm talking a long term shift in priorities. There are still lots of consoles and people using them out there, and there will always be some number who will continue to do so regardless of the state of things, but there are just as many people NOT using them who still game. The latter group is only going to continue to grow if current trends continue, while console numbers have pretty much been stagnant (or decreasing depending on who you ask) for the last couple years.

Microsoft is in a kind of unique position where it already has a strong foothold on non-console platforms, so putting more emphasis on that while convincing console gamers to double dip is probably the smartest path for them to take.

Microsoft should just go third party already, there is no reason to divide a ~90 million console userbase into 60:30 when you can have a healthy cool 100 million userbase. Offcourse there is some degree of overlap but a console market with Sony vs. Nintendo would be ideal.

Their E3 showing proved that it is nothing that can't be done on a PC as most titles were 3rd party exclusives. I still don't get why they just don't put windows 10 on the XB1X. That's the only legitimate reason to exist xbox would ever get. $500 dollar windows PC.

@bigsocrates: This is basically what I was tryin to get at, and is something important to keep in mind to put everything else into context. I'm just not great at expressing that I guess.