How Microsoft Is Ditching the Video Game Console Wars


In 2014, Satya Nadella, the then Microsoft’s new CEO, welcomed the executives of the company’s gaming division into his office in Redmond, Washington, in mid-2014.

Mr. Nadella was asked to sign a $2.5 billion check to purchase Mojang, a giant Swedish company that created the blocky, pixelated game Minecraft. Mr. Nadella questioned whether Microsoft should continue to invest in video games while being continuously outsmarted by Sony in the console market. He wondered how feasible the idea was at first, and was reluctant to sign the agreement.

Then Xbox’s new CEO, Phil Spencer, informed Mr. Nadella about Minecraft’s expansive universe, which allowed millions of people to socialize while also encouraging teens to learn math and science. Mr. Spencer stated that a deal would be the first step in transforming Microsoft’s gaming company into one that caters to a larger audience rather than simply console players.

Today, the online casino industry could be reaping more from software rather than hardware, a direction at which many brands are taking. Vwin, an Asian gaming brand provides a myriad of video gaming opportunities for users from all over the world, using sophisticated software for the best experience.

Mr. Nadella agreed and the acquisition was completed. According to more than 20 Microsoft top-brass employees, game creators, industry experts, and gamers interviewed, what followed was a years-long change. Rather than competing only with Sony for console sales, Microsoft purchased 15 additional game companies and invested in new technologies, such as a Netflix-style games subscription service and a mobile application called cloud gaming.

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Microsoft’s video game division looks quite different now, as it showcases new products this weekend at the Electronic Entertainment Expo, or E3, an annual gaming event. The Xbox, which was updated in November, is still the company’s most well-known product. Despite this, it has expanded beyond boxy hardware to provide a new set of services.

Hundreds of thousands of fans tuned in to this year’s virtual-only series of trailers revealing forthcoming releases, despite the fact that several big game firms, like Sony, have steered away from E3 in the past, opting to unveil new titles on their own terms.

On Saturday, Ubisoft, a French game company, was the highlight of the first day of E3, while Microsoft showed off 30 new games on Sunday, including the Forza racing game and Starfield, a science-fiction blockbuster. On Monday and Tuesday, the event’s last two days, developers such as Nintendo, Take-Two Interactive, and Bandai Namco will address fans.

Microsoft, on the other hand, believes that gaming is poised to be post-hardware, where consumers will not be ready to pay hundreds of dollars on a console, according to executives and experts. People may no longer be bound to certain devices to play games in the future, according to them, and will be more concerned with software and services.

While Xbox consoles continue to produce significant income — Microsoft reported $5 billion in quarterly gaming revenue for the first time in January, boosted by the launch of the Xbox Series X — the firm ceased revealing console sales in 2014. According to Tim Stuart, Xbox’s chief financial officer, the bulk of gaming income comes from content and services rather than Xbox hardware sales.

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