Xbox testing waters with four first-party games coming to PS5 and Switch to see if they benefit its long-term health and growth

Microsoft has finally shared the promised update on the future of Xbox and its business strategy. The company detailed its approach to game exclusivity and finding players on other platforms, as well as its plans for Game Pass and next-gen hardware.

Pentiment

The Xbox leadership team opened up about their plans in a special episode of the official Xbox podcast. Below are the key takeaways.

Four Xbox first-party games will launch on rival consoles

• Microsoft Gaming CEO Phil Spencer refused to name those titles, but they are: a) over a year old; b) definitely not Starfield and the upcoming Indiana Jones and the Great Circle.
• According to The Verge, the four Xbox games that will be ported to other platforms are Pentiment, Hi-Fi Rush, Sea of Thieves, and Grounded. This is in line with what Spencer mentioned, saying that two of them are smaller titles that “never really meant to be built as platform exclusives,” and the other two are community-driven live service titles.
• Spencer noted that every decision about the company’s gaming business is made with “long-term health of Xbox” in mind. This means, among other things, growing Xbox as a platform and reaching as many players as possible.
• Microsoft believes that this move won’t damage Xbox and its growth, while also helping it make players on other platforms interested in Xbox as a brand. So the plan is to launch these four products and learn from their performance outside of the current ecosystem.
• Speaking with Stephen Totilo for his Game File newsletter, Spencer noted that Microsoft wants to test the waters with these four projects in terms of their potential ROI and player interest.

Does Xbox still believe in platform exclusives?

• Although the four titles mentioned above won’t change the company’s “fundamental exclusive strategy” and all first-party games will still launch on Xbox/PC/Game Pass/cloud first, Spencer thinks the concept of platform exclusivity will become less dominant across the industry in the future.
• “I do have a fundamental belief that over the next five or ten years, exclusive games, games that are exclusive to one piece of hardware, are going to be a smaller and smaller part of the game industry,” Spencer said, adding that Xbox wants to be a “great platform” for developers that are trying to ship their titles on multiple platforms
• Matt Booty, president of gaming content and studios, noted that seeing games that could be bigger than any one platform (Fortnite, Roblox, etc.) made Microsoft rethink its approach to growing its business. But the core principles remain the same: “First, all of our games will be on the Xbox platform. Second, all of our games will go into Game Pass on day one. And third, we know that Game Pass will only be available on Xbox.”
• Spencer also told Totilo that games like Helldivers 2 are great examples of why shipping titles to multiple platforms might be beneficial. “I will say, when I look at a game like Helldivers 2 — and it’s a great game, kudos to the team shipping on PC and PlayStation — I’m not exactly sure who it helps in the industry by not being on Xbox,” he said, while acknowledging that there is a “legacy in console gaming” of locking games on certain platforms (especially when “we do the same thing”).

Game Pass hits 34 million subscribers

• According to Xbox president Sarah Bond, Game Pass now has 34 million subscribers. This is the first time Microsoft has officially updated the numbers since the 25 million milestone announced in January 2022.
• Diablo IV will come to Game Pass on March 28 as the first Activision Blizzard game on the service. It will be followed by other titles, but no specific schedule has been announced. So it is still unclear when Call of Duty will become available via subscription.
• Spencer also told The Verge that Game Pass accounts for 10-15% of Xbox’s content and service revenue, but the company has no plans to “make everyboy a Game Pass subscriber.” “The one thing I will say about the Game Pass subscriber revenue is that it’s consistent,” he said. “You can look at it, it’s growing. You can kind of see its growth. You know plus or minus what it’s going to be next month and the month after.”

Plans for next-gen Xbox hardware

• Despite the rumors, Microsoft won’t move away from being a hardware manufacturer and platform holder. This holiday, it will share its plans for the next-gen Xbox console. Bond stated that the company is focused on delivering the “largest technical leap you will have ever seen in a hardware generation.”
• Speaking to The Verge, Spencer noted that there might be plans for several devices. “[We’re] really thinking about creating hardware that sells to gamers because of the unique aspects of the hardware,” he said, adding that Microsoft sees a “lot of opportunity in different types of devices, and will share specifics on our future hardware plans as soon as we are ready.”
• One such device could be a handheld, as Spencer said, laughing, that he is a “big fan [of handhelds], but nothing to announce.”