Microsoft Has Reportedly Shut Down Xbox’s Physical Games Division – Rumour

Departments dedicated to releasing Xbox games physically have been shut down amidst Microsoft layoffs, it's been claimed.

Posted By | On 26th, Jan. 2024

xbox series x xbox series s

The first month of 2024 isn’t over yet, but it’s already been a brutal year for the games industry, with thousands of people having lost their jobs in a barrage of industry-wide layoffs. Microsoft recently added a significant chunk to that number when it announced that it would be cutting 1,900 jobs across its entire gaming division, and it seems those layoffs are also going to come at the cost of the company’s physical distribution.

That’s as per Windows Central journalist Jez Corden, who said in a recent tweet that Microsoft has shut down “departments dedicated to bringing Xbox games to physical retail”. Corden went on to point out that that doesn’t necessarily mean Xbox is quitting physical media altogether, and could instead opt to outsource physical distribution going forward- but it’s certainly not a good sign for where the company’s long-term plans are headed.

Of course, it’s worth pointing out that Microsoft has been on the forefront of the industry in its adoption of digital media over physical distribution. The Xbox Series S is an all-digital console, while leaked internal documents last year also suggested that the company had a mid-gen Xbox Series X model in the works that would be digital-only.

Recently, it was announced that upon its launch in May, upcoming flagship first party title Senua’s Saga: Hellblade 2 will only be available digitally.

Microsoft itself has yet to comment on whether its physical games division has been affected by layoffs.

As part of Microsoft’s layoffs, Blizzard Entertainment’s unannounced survival game has been officially cancelled, with reports suggesting the project’s development had been hampered by behind-the-scenes issues with Blizzard’s proprietary Synapse engine.

Blizzard Entertainment president Mike Ybarra has also confirmed he’s leaving the company.


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