Microsoft has released public guidance to the SEC recently as they must do with their responsibilities. In reading between the lines Microsoft, contrary to the Internet’s popular running theory, are not done with the gaming landscape.
On their gaming segment:
“Our gaming platform is designed to provide a variety of entertainment through a unique combination of content, community, and cloud. Our exclusive game content is created through Xbox Game Studios, a collection of first-party studios creating iconic and differentiated gaming experiences. We continue to invest in new gaming studios and content to expand our IP roadmap and leverage new content creators.”
“These unique gaming experiences are the cornerstone of Xbox Game Pass, a subscription service and gaming community with access to a curated library of over 100 first- and third-party console and PC titles. The gamer remains at the heart of the Xbox ecosystem.”
“We continue to open new opportunities for gamers to engage both on- and off-console with both the launch of Project xCloud, our game streaming service, and continued investment in gaming hardware”
This could mean one of two things: Microsoft is going out to get more studios and games deals done in the short term or we could be seeing a ramp-up in first-party investment to drive a long term slate of content. Realistically it’s probably a bit of both but there is nothing in here that we can see about the rumoured WBIE sale being put out by AT&T. We will have to wait and see if anything comes from that.
With regard to online services:
“Project xCloud utilizes Microsoft’s Azure cloud technology to allow direct and on-demand streaming of games to PCs, consoles, and mobile devices, enabling gamers to take their favourites games with them and play on the device most convenient to them.
“Xbox Live is designed to benefit users by providing access to a network of certified applications and services and to benefit our developer and partner ecosystems by providing access to a large customer base.”
“Growth of our Gaming business is determined by the overall active user base through Xbox enabled content, availability of games, providing exclusive game content that gamers seek”
Here we can see that Microsoft is not happy just leveraging gaming into a console only ecosystem, they want their gaming division everywhere that their operating systems can touch. Whether its console, PC, or cloud, gaming at Microsoft drives value into all sectors.
This makes investment easier in the gaming landscape especially as the Series X boards come into the xCloud ecosystem providing better usage benefits for both Microsoft and the player. It is interesting to note that we see Microsoft flag Google, Facebook and Amazon as rivals first in their briefing which also tracks with their goal of increasing Azure’s prominence in all cloud computing engagement.
With regard to future investments:
“We make significant investments in products and services that may not achieve expected returns. We will continue to make significant investments in research, development, and marketing for existing products, services, and technologies, including Xbox Live”
“Acquisitions, joint ventures, and strategic alliances may have an adverse effect on our business. We expect to continue making acquisitions and entering into joint ventures and strategic alliances as part of our long-term business strategy.”
It’s interesting to note also that Microsoft has flagged over 25 billion dollars in future investments with regard to contractual obligations in the next 12 months.
With the announcement of the Surface Duo releasing in September and the Xbox Series X/S releasing in November (although we haven’t had an official announcement of the worst secret in console hardware history just yet), we can intuit that a lot of hardware will be produced next year and there can be some wiggle room in there for software acquisitions.
How this relates to Xbox Game Studios proper is unclear but it does show an intention to keep investing in the new-school Microsoft way—gaming where you want it with the things you want to use, new hardware in the short term and a long-standing commitment to software in the future.
For more news as it happens, keep coming back to xboxera.com!
