What Microsoft should do to stay competitive.

[EricHiggin]

VAMatt said:

I think there is zero chance that they do not put Xbox game studios games on game pass day one. That would be a total trust killer at this point. Zero chance of that happening.

I think with Microsoft needs to do is to continue pushing hard on gamepass, and gracefully exit the hardware business over the next decade. They should become a platform neutral software provider. They want to do that with game pass. But, if game pass isn't moving quickly enough, or the idea just isn't going to have broad enough appeal, there's no reason not to sell games the normal way on other systems.

Microsoft is and always has been a software company. In the gaming industry, hardware is almost always sold at a loss. Nintendo is able to generally do it at break even. But, there is nobody in the dedicated hardware business that is selling hardware as a profitable business. The hardware is a lost leader to sell software. So, in theory, at least, getting out of the hardware business is a positive. Of course, for it to be a positive and practice, microsoft needs to be able to move lots of software without the dedicated hardware. And they just purchased the company that has been better at that than anybody else in history: Activision. So, they certainly have the expertise to do it.

Anyway, I don't know exactly what they're going to say this week. But I can say with a pretty high level of confidence that Microsoft will be out of the console business within the next decade.

They might continue selling controllers, because people do love the Xbox controller. They'll just need to make those things compatible with Nintendo and PlayStation. But, beyond that, I expect them to focus on software only in the long term.

The more XB steered away from hardware, and more towards GP, the more I'd assume their console owners would slowly shift to PS and Nin hardware (as well as some to PC). MS could make some serious dough off their controllers in this case. Some XB players are diehards for that controller layout and would pay a premium to have it be accessible on other consoles. I'd even bet you'd get more than a few PS and Nin long term players who would pick up an XB controller if they could.