Upcoming Xbox Exclusives Are Being Sent Out To Die, Analyst Says; Xbox Pushes Back
Overview & Key Takeaways
Xbox's chief strategy officer has pushed back against claims that Microsoft could "reverse course" and alter its stance on exclusive games. At the same time, analyst Rhys Elliott of Anlinea Analytics tells GameSpot that Gears of War: E-Day and Clockwork Revolution are being sent out to die on purpose.
Matthew Ball, who joined Xbox earlier this year, said the rumors saying Microsoft might "reverse course" are false. Gears of War: E-Day and Clockwork Revolution "will stay exclusive," he said, adding that there are "no conversations and have been no conversations to 'reverse course.'"
Not only is Microsoft not changing its stance on exclusives, Ball reiterated that Microsoft plans to build on this and release "signature exclusives ... every year."
E-Day and Clockwork Revolution are not timed exclusives for Xbox, but full exclusives, Microsoft has said. The company said the same thing about Starfield, though, and it later came to PlayStation 5.
"Sacrificial Lambs"
Elliott told GameSpot that Microsoft will never succeed in the console space and promising fans exclusive games to help drive console sales is not going to make a difference. Gears of War: E-Day and Clockwork Revolution are basically being sent out to die, he said.
"Console as we know it is over for Xbox--and has been for a while. There’s no turning that ship. But they still need to pretend to care until they’ve transitioned to pastures where they can return to growth (if they succeed)," he said.
"A Gears console exclusive does not shift meaningful numbers of Series X units. Exclusivity as a hardware-driver is over for them, because the install base it would drive simply isn't responsive enough to justify the cost of building hardware at a 5x component premium. And those games are on Steam anyway," he added.
Elliott went on to say that Gears of War: E-Day and Clockwork Revolution are "sacrificial lambs for hearts-and-minds, not economics."
"Xbox is pulling some games off PlayStation while keeping them on Steam, so they’re still adding to Steam's value proposition while adding almost nothing to their own console's," he said.
Elliott went on to say it's plainly obvious that there was a PS5 edition of E-Day in the works, and lots of evidence suggests this is true. Meanwhile, Xbox CEO Asha Sharma's reported decision to pull a Halo trailer from the recent PlayStation State of Play event was "symbolic, relationship-damaging, and revenue-negative" for Xbox, he said.
"I’m not sure how worth it the exclusivity change is in the long term--and I expect there to be some backtracking once the revenue numbers come in," Elliott added. "If the data is any guide, the titles that stay Xbox-first or Xbox-only will mostly be the ones a sliver of the PlayStation audience would have bought anyway. So nobody is really losing sleep over that math."
Going forward, Elliott said he expects Microsoft to take the same approach it has for years with regards to exclusive games, and that is that Microsoft will pick these on a case-by-case basis. "Which is a polite way of saying symbolic where it's cheap, abandoned where it's expensive," he said.
"The spreadsheet wins the argument it always wins"
Elliott went on to say that the "tell" from Microsoft that its exclusivity plan is not working will be if the company announces future multiplatform releases for PS5, messaged to players that it was actually a "case-by-case" decision. In reality, though, Elliott said this was "always a hearts-and-minds gesture with a shelf life."
Elliott said he expects this to happen at some point over the next year, after the numbers come in and show that the math just does not work.
"I'd expect any backtracking to land after a quarter or two of revenue numbers, once the cost of walking away from 90M-plus PS5 owners shows up in a report someone has to present. That's the moment the spreadsheet wins the argument it always wins," he said.
Pain ahead
According to reports, Microsoft is going to lay off staff and close, or spin off, multiple development studios soon due to Xbox's financial struggles of late.
Just recently, Microsoft CEO Satya Nadella talked about how Xbox has been struggling for some time and that it is imperative that Microsoft finds a way to “turn [Xbox] into a sustainable business.”
The way Microsoft is apparently going to do this is by making drastic cuts to "reset" the Xbox business. Double Fine, Compulsion Games, Arkane, and Ninja Theory are all currently said to be negotiating with Microsoft to decide their fates. Double Fine reacted to the reports with the sweat smile emoji.
https://twitter.com/DoubleFine/status/2066719196944478636
In a blog post announcing what's to come for Xbox in the next 100 days, Xbox CEO Asha Sharma alluded to major changes, and difficult ones.
"For some of you, these realities will be surprising and even frustrating to discover," she told staff. "We won’t succeed by hiding hard truths, nor will we succeed by doing the same thing and expecting different results."
Xbox’s chief strategy officer has pushed back against claims that Microsoft could “reverse course” and alter its stance on exclusive games. At the same time, analyst Rhys Elliott of Anlinea Analytics tells GameSpot that Gears of War: E-Day and Clockwork Revolution are being sent out to die on purpose.
Matthew Ball, who joined Xbox earlier this year, said the rumors saying Microsoft might “reverse course” are false. Gears of War: E-Day and Clockwork Revolution “will stay exclusive,” he said, adding that there are “no conversations and have been no conversations to ‘reverse course.'”
Not only is Microsoft not changing its stance on exclusives, Ball reiterated that Microsoft plans to build on this and release “signature exclusives … every year.”
E-Day and Clockwork Revolution are not timed exclusives for Xbox, but full exclusives, Microsoft has said. The company said the same thing about Starfield, though, and it later came to PlayStation 5.
“Sacrificial Lambs”
Elliott told GameSpot that Microsoft will never succeed in the console space and promising fans exclusive games to help drive console sales is not going to make a difference. Gears of War: E-Day and Clockwork Revolution are basically being sent out to die, he said.
“Console as we know it is over for Xbox–and has been for a while. There’s no turning that ship. But they still need to pretend to care until they’ve transitioned to pastures where they can return to growth (if they succeed),” he said.
“A Gears console exclusive does not shift meaningful numbers of Series X units. Exclusivity as a hardware-driver is over for them, because the install base it would drive simply isn’t responsive enough to justify the cost of building hardware at a 5x component premium. And those games are on Steam anyway,” he added.
Elliott went on to say that Gears of War: E-Day and Clockwork Revolution are “sacrificial lambs for hearts-and-minds, not economics.”
“Xbox is pulling some games off PlayStation while keeping them on Steam, so they’re still adding to Steam’s value proposition while adding almost nothing to their own console’s,” he said.
Elliott went on to say it’s plainly obvious that there was a PS5 edition of E-Day in the works, and lots of evidence suggests this is true. Meanwhile, Xbox CEO Asha Sharma’s reported decision to pull a Halo trailer from the recent PlayStation State of Play event was “symbolic, relationship-damaging, and revenue-negative” for Xbox, he said.
“I’m not sure how worth it the exclusivity change is in the long term–and I expect there to be some backtracking once the revenue numbers come in,” Elliott added. “If the data is any guide, the titles that stay Xbox-first or Xbox-only will mostly be the ones a sliver of the PlayStation audience would have bought anyway. So nobody is really losing sleep over that math.”
Going forward, Elliott said he expects Microsoft to take the same approach it has for years with regards to exclusive games, and that is that Microsoft will pick these on a case-by-case basis. “Which is a polite way of saying symbolic where it’s cheap, abandoned where it’s expensive,” he said.
“The spreadsheet wins the argument it always wins”
Elliott went on to say that the “tell” from Microsoft that its exclusivity plan is not working will be if the company announces future multiplatform releases for PS5, messaged to players that it was actually a “case-by-case” decision. In reality, though, Elliott said this was “always a hearts-and-minds gesture with a shelf life.”
Elliott said he expects this to happen at some point over the next year, after the numbers come in and show that the math just does not work.
“I’d expect any backtracking to land after a quarter or two of revenue numbers, once the cost of walking away from 90M-plus PS5 owners shows up in a report someone has to present. That’s the moment the spreadsheet wins the argument it always wins,” he said.
Pain ahead
According to reports, Microsoft is going to lay off staff and close, or spin off, multiple development studios soon due to Xbox’s financial struggles of late.
Just recently, Microsoft CEO Satya Nadella talked about how Xbox has been struggling for some time and that it is imperative that Microsoft finds a way to “turn [Xbox] into a sustainable business.”
The way Microsoft is apparently going to do this is by making drastic cuts to “reset” the Xbox business. Double Fine, Compulsion Games, Arkane, and Ninja Theory are all currently said to be negotiating with Microsoft to decide their fates. Double Fine reacted to the reports with the sweat smile emoji.
In a blog post announcing what’s to come for Xbox in the next 100 days, Xbox CEO Asha Sharma alluded to major changes, and difficult ones.
“For some of you, these realities will be surprising and even frustrating to discover,” she told staff. “We won’t succeed by hiding hard truths, nor will we succeed by doing the same thing and expecting different results.”
