More than nearly every other company in the industry right now, it seems like Microsoft are looking ahead to the future the most (with stiff competition from Google). With their focus on Xbox Game Pass, their open ecosystem with Xbox and PC, the upcoming Xbox Scarlett, and the upcoming xCloud, it seems like Microsoft are making all the right moves to greatly expand their presence in gaming (if it all goes well, at the very least).
Microsoft definitely seems to be confident about its position and its growth in the industry. Speaking recently at their quarterly investors call (via Twinfinite), Microsoft CEO Satya Nadella said that with Game Pass and xCloud, among other things, the company is primed to continue to grow in what they think is going to be a hugely expanded gaming market in the coming years, while also citing the upcoming xCloud public trials, the increasing userbase of Xbox Live, the launch of the upcoming Minecraft Earth, and Microsoft’s ever-growing portfolio of first party studios.
“We’re investing to empower the world’s two billion gamers to play the games they want with anyone, anywhere, on any device with our new game streaming service, Project xCloud which will enter public trials this fall,” said Nadella. “Xbox Live monthly active users increased to a record 65 million with the highest number of mobile and PC users to date.
“We’re bringing one of the the world’s most popular video games to a new generation of mobile gamers with Minecraft Earth and mixed reality, and we nearly doubled our first-party studios this year to deliver differentiate content for our fast-growing subscription services like Xbox Game Pass, now available both on consoles and PC.”
“I’ll say we are in gaming because of what we believe are going to be the secular changes in the gaming addressable market for us,” Nadella said later on. “We’ve always had a gaming position with console as well as the PC, but going forward we think that any end point can in fact be a great end point for high-end games, which is where our structural position is, and we now have a business model with Game Pass as well as all the supporting mechanisms for game pass like game streaming, we have a social network in Xbox Live that is the best in the business. So I feel we’re well-positioned to what is going to be a much larger market than what was traditionally gaming in spite of all the success we’ve had over the years in gaming.”
“The second point is that it builds on the rest of the cloud investment, so if you think about what we’re doing with xCloud it’s a workload on top of Azure,” he continued. “If you think about capital allocation, what’s happening in the cloud, what’s happening in the edge, how we build the network, how we optimize with streaming… The same infrastructure for example is what Sony has decided to use as well and be on Azure as well as user AI capabilities.”
During their quarterly financial briefing, Microsoft also revealed that revenue from their gaming division had decreased year-on-year, owing to the current generation of consoles approaching its end. Read more on that through here.