They are really doing the best that they can do with a contracting market, and have realized that the best way to save the brand is to become Steam 2.0 . Just because they failed, doesn't mean that the strategy is bad, sometimes there are better competitors that can just do it better.

Sooo many factors to take into account here. Thankfully most of it has been discussed already so I don't to repeat too much.

But there was a clear lack of direction as to where the brand should situate itself in the future at the juncture they decided to stop console exclusives as their clutch to garner interest in their brand.

Gamepass and the opening to PC gaming with their games devalued the Xbox brand as a whole and then came the moment they realized the Netflix "strategy" was not paying the dividend they hoped for, so they pivoted again with third part acquisitions in mass to gather capital from other revenue streams other than the one they already had.

Clearly, the focused on the pure gaming side has felt lackluster in the worst sense of the term ...

Also, it needs to be talked about how Xbox has basically screwed it's brand image on the international market since the Xbox One days. Suffering a decline so hard that Microsoft had no choice but to retract and cheapen their offerings in Europe and elsewhere that's basically not the US.

Therefore, there's a legitimate large pool of customers that basically is left ignored by not putting the required resources to make it's known.

Because Xbox was going to be stuck in 3rd place no matter what they did.

Think about that. They spend massive amounts of money on game studios, they lose huge amounts on hardware, they spend on new technology like Kinect, they even leverage Xbox with their Windows monopoly. The money flows from Microsoft like water and they try so many things to force their brand to the top.

And they're stuck in 3rd place.

Microsoft does not buy their way into an industry to be in 3rd place. They don't care about gaming, they want market share so they can impose their ecosystem on as many people as possible with subscriptions and services and related products. Gaming is not the destination for Microsoft, it's a Trojan Horse that allows them access into the lives of even more people. In order to accomplish that, they need to bulldoze the competition and take control of the industry. The Xbox One launch was a preview of where Microsoft wanted to take gaming.

Not only did that NOT happen, it has become clear that it will probably never happen.

So they shifted gears. It's really as simple as that. Xbox going third party isn't making them fail, they're going third party because they knew failure was inevitable. Sure, by most standards Xbox was in a decent position, but when you're a behemoth like Microsoft, last place is just not acceptable.

From a business perspective:

I don't believe they would have changed their strategy if series sold 60 million at the moment, it hasn't been about the hardware sales for a long time, it is a recurring theme on vgchartz and a few old youtubers videos that Sony is stupid is stupid for not lowering the price of PS5 they would have been selling so much more, or why did Nintendo drop the price of the switch yet it would have surpassed the PS2 already why is nintendo so dumb?

People are just uncomfortable with the idea that consoles are becoming less relevant especially the +40year olds group of gamers on youtube.

Honestly I think the biggest winner this generation is the steam deck

Steam Deck, at least in its current iteration, will be lucky to sell as much lifetime as the Vita.

To say its a bigger winner than the Switch which will likely sell more than 10 times as much lifetime is a very strange statement.

While I think initially the 2 SKU idea and GamePass seemed like good wins, they've ultimately not been that important to keeping them competitive in the long run.

They also suffer from translation issues for their games iirc from what some ppl said on this site.

And I think investment in GamePass came at the expense of notable exclusives (timed or not) which would've hampered them too.

It is kind of the point that really hw doesn't mean much anymore, it is kind of a silly argument if someone would say 'steam deck was a big failure even the vita outsold it and steam deck has no exlusives!'

It is a winner because it is came on the market as just another way of playing steam games, that plays also some xbox and ps games and with more than 15K games as steam deck verified it will be hard for MS/Sony to compete.  Especially with Steam OS releasing on more PC handhelds in the future...

For me it feels a bittersweet because I joined here in 2007 when everyone was saying how pc gaming is dying and stores are stopping selling PC games because no on plays PC games...

Yeah I don't get that argument of physical hw sales, especially when we consider the fact that Steam's ecosystem is vastly larger than that of Nintendo's, library, features and all. Also it doesn't make much sense these days when digital and ecosystems are being valued more and more than physical sales. We see so many brands literally branching out into other industries and platforms, and Nintendo sticking to 1-2 areas doesn't somehow make them greater than the rest, because that is not the metric we are following today, like we did back during the 90's to mid 00's. 

Steam Deck is still selling, Steam OS is now being implemented over time for other portable systems and eventually for desktop usage, which in turn will spread Steam's ecosystem far further than what Nintendo's is always going to be like (Mobile and their console only and nowhere else). 

I can't help but notice a slight pattern amongst some of you here, when it comes to talking about MS and "exclusives".

When some of you say "exclusives", what some of you are relating it to is console platform exclusivity, and not console exclusivity (exclusive to one console, but available on PC as well). I said before that MS isn't really geared to maintain two separate lines of studios to make games "only for Xbox" and games "only for PC", because that does not make sense with their unified brand strategy.

Think about it for a few moments in a non hardcore brand fan way... If you split MS into two platform lines of studios, that means PC will not get Gears, Fable, Halo, Forza and so on, while PC will only be left with AoE and AoM. The balance would be lopsided and have MS going back to their old ways of neglecting the very platform they originally started off with (PC was their first).

MS would also face the issue of having to come up with games "just for PC", that cannot show up on Xbox, and then you're going to eventually see people complaining about how splintered their Xbox and MS Windows libraries are, whilst also having to use both at different times. In the modern era, this does not make sense, especially when you consider that Sony are releasing their games on PC and they work either via Steam or via PSN (but PSN at this current time is disrupting Steam's ecosystem in a negative and abusive manner whether you like it or not).

MS cannot go back to the 360 days where they keep themselves split into two entities, while trying to maintain this whacky balancing act for both PC and Xbox, while also trying to make excuses for why Xbox cannot have this PC game or vice versa for PC, especially within this day and age where multiple platforms are trying to lay their own foundations for being able to "play anywhere on anything".

What you want, what you truly want in your own mind is from a bygone era, and it will never come back, because it does not make sense from an evolution pov, especially with how our species wants to strive forward towards making things more accessible, more easy to use for ease of life and comfort. Going back to keeping their console/PC divisions completely separate would go back on all of that, and would only ever appeal to a few hardcore folks in that market. The world today is not filled with hardcore only people, it is a mix of casual, normie and hardcore people (and the former two outnumber the latter, that is undeniable).


At the end of the day, MS cannot "fix" their issue by simply going back to 2006 and splitting PC and Xbox back in two, and going back to neglecting PC all over again, because they'll just lose even more ground than what they have currently, and that in turn would lead to an even faster decline. Some of you need to stop thinking like brand businessmen and be more realistic with the data we currently have (By that I mean that we hardcore folk are outnumbered and what we want matters very little to the normies & casuals, they want to be able to play anywhere at any time).

Forza Horizon 5 is vastly superior over Forza Horizon 4 but of course somebody like you that never played either game would not know that.  Also, they don't pump out Forza games anymore but again somebody like you that never played one would not know that.