Speaking at Barclays Global Technology, Media, and Telecommunications Conference in San Francisco, Microsoft’s Xbox boss Phil Spencer has revealed Microsoft’s future game plan for his division, and it looks a lot like Netflix.
“We’ll have multiple business models that will work with streaming, but the connection of streaming with the subscription model makes a ton of sense,” said Spencer. “You see it in music. You see it in video. So you can look at Project xCloud and you can look at something like Game Pass, and you can see there’s natural synergies.”
That means for a monthly $10 for the Microsoft Game Pass, he expects players to be able to access any game on any platform via streaming.
“For us, it’s all about how we reach 2 billion gamers,” said Spencer. “If you build the market around a couple hundred million people who are going to own a game console or a high-end gaming PC, then your business-model diversity can actually narrow because your customers are narrow. But when you think about reaching a customer with this content where their only compute device could be an Android phone, you think about, well, what are all the ways that person pays for content if they do at all today?”
Spencer revealed that the Xbox division passing $10 billion in yearly revenue drew the attention of Microsoft’s money people, who have opened the purse strings.
“Amy Hood, our CFO, she likes to tell me I’ve made ‘the spreadsheet,’” Spencer said during a fireside chat. “So she’s going to pay attention.”
This has allowed Spencer to direct a number of strategic investments over the last year.
“We’ve acquired and started seven new first-party studios in the last year,” said Spencer. “We obviously don’t do that without tremendous support from Satya and Amy.”
“We understand content is a critical component of what we’re trying to build,” said Spencer. “And the support from the company has been tremendous.”
Game Pass and Streaming aligns the gaming division neatly with Microsoft’s current push for the cloud and subscription services, suggesting the best game Spencer has played is managing the corporate shuffle at Microsoft.
I have said before that the need for a high-end PC is limiting Microsoft’s gaming distribution. What do our readers think of the streaming push? Let us know below.