Why Would ANYONE Buy an Xbox?

- Why does Xbox exist? I mean, it seems like a simple question, but for the last year or so, there really haven't been a lot of great answers as to why you should buy an Xbox. It seems like the people in charge don't have a better answer either. So, look, I'm gonna be honest, I want Xbox to at least be competitive. Do you wanna live in a world where PlayStation has zero competition? It's also a little personal for me, and you can kinda tell the whole story of my channel through the last few generations of Xbox. Back in 2009, I traded my entire gaming collection in to buy an Xbox 360. It almost immediately Red Ringed on me. I mean, my first E3 was the launch of PS4 and Xbox One, one of the most infamous days in Xbox history. And getting to reveal the Series X was one of the biggest moments in my career. So yeah, I want Xbox to, you know, continue to exist, which is why we've gotta talk about the Xbox Reset. It was literally last week at Xbox Showcase where I said that the easy part was done and the hard part was coming. I didn't expect the hard part to show up this fast. Okay, so to be totally fair to Xbox, the last 100 days of Asha running the show have been genuinely good. They cut the price of Game Pass, they brought back real console exclusives, so there's Gears E-Day as well as Clockwork Revolution to start, and almost certainly more to come. They killed the stupid everything is an Xbox campaign that basically nobody liked, and the showcase itself was solid. Gears, Halo, Fable, I mean, Forza is already out and selling big numbers. Asha has walked in as the new CEO and really given Xbox fans a reason to be excited in just her first three months on the job. But these were the easy wins. The real problems are, well, very real, and they just shared them in way more detail than they should. Last week, just a few days after Showcase, the Xbox team published a memo called, "Next 100 Days: XBOX Reset." And holy (quacks). The Xbox team have been doing the rounds with interviews the last couple of weeks, setting stage here, really, with references to the business not being, quote unquote, "Healthy." But this memo, which I wanna be clear, it wasn't leaked, they posted publicly, paints a terrible picture of where things really are for Xbox right now. I'll be honest, it is actually worth reading in full, but here are some of the takeaways. The cost of memory and storage, you know, the chips inside every console, has already doubled, and they're preparing for it to hit more than five times more than the cost before the RAM crisis by holiday of next year. Now, they think that they actually got hit harder than anyone else in the industry, because of, quote unquote, "Choices they've made over the last five years," which I feel like is a loaded phrase that I bet there's a whole backstory too. But they're in a mess. A huge part of my job is coming up with video ideas. And here's the thing, y'all give me tons in the comments. So when Zapier reached out to sponsor this video, it was the perfect time to build something I've wanted forever, an easy way to consolidate ideas and feedback from the comments into something I can actually use. Zapier's pitch is simple, their job is to connect apps and run workflows between them. Zapier has an MCP server, which is a fancy way of saying that you can plug it directly into tools, such as Claude or ChatGPT. Now, I had to authorize it in my Claude settings myself. It's not always on, it's only something that I enable when I want it. So now, Claude can pull from my YouTube comments and drop the organized ideas directly into Notion. In just a few minutes of setup, I had my first batch of ideas, including one on smartphone features that were killed too soon. Manually, I probably wouldn't have noticed, but these are ideas from you, Zapier just helps to surface them and so much more. There are so many things you can do with Zapier, so if you wanna check it out, I'll have a link in the description. And again, big thank you to Zapier for sponsoring this video. The crazier part is the actual business side. Over the last five years, essentially, the Xbox Series X generation, Microsoft has poured something like $20 billion into Xbox, only for revenue to go down. For context, because I think at this point, we're all desensitized to billion this, trillion this, over the entirety of PlayStation, Sony profited about $20 billion. Now, I'm not saying the PS5, which is the most profitable generation, no, $20 billion from PlayStation since the PS1 launched over 30 years ago. Seriously, just sit with that for a second. (lips trilling) You can say a lot about Microsoft, but you cannot fault them for not investing huge piles of cash into Xbox. The idea of putting $20 billion in, and during that time, seeing your revenue drop not rise, is honestly kind of unbelievable. I maybe wouldn't have shared those numbers if I was running the show, but hey, appreciate the transparency by really letting everyone know just how deep a hole they're really in. This by the way completely sidesteps the almost $70 billion they invested in buying Activision Blizzard, a deal I think in hindsight they probably overpaid for. As of right now, the entire Xbox division is running at a, quote unquote, "3% accountability margin," which, again, is trending down and not up. To top it off, you've got Satya Nadella, the CEO of all of Microsoft, saying this. - Like there's more monetization of Xbox games happening on YouTube than at Microsoft. - Holy (quacks). I mean, I do think he's kinda joking here, but clearly, things are not working right now. Now, again, I wanna be really clear what this video's about, I want Xbox to succeed. But reading these numbers gives me heartburn. I mean, even for a huge company like Microsoft, this is not sustainable. I think that that's why they've shared so much, they've got to make some big changes right now, and this memo is kind of the justification for it. So that's the situation, which brings us right back to the one question that even Xbox admits they can't answer today, "Why should anyone buy an Xbox?" I mean, historically this was a pretty simple question. You bought an Xbox, or a PlayStation for that matter, to play the big exclusives, and because that's where your friends played. But at this point, neither of these are really true. Games like Halo and Forza are not only on PC, but they're also on PS5. And cross play has largely become the standard now, which means it's a real edge case to not be able to play with your friends, regardless of the platform. The days of picking a console, because that's where all your friends are, that's just not a thing anymore. Opening things up did work to sell games, but it gutted almost every reason to buy an Xbox console, outside of Game Pass? I mean, the obvious answer this generation has just been to buy a PS5, which plays everything. And guess what? Everyone's bought a PS5. The sales have not even been close with the Xbox. Now, they have started to roll back console exclusives, but this is gonna be a slow process. I mean, they've already committed most of their big titles, like Halo: Campaign Evolved, to land on PS5. Just snapping your fingers and pulling everything back to Xbox would just lose sales at this point and really, really piss off Sony. And that's the tough balance. Do you value selling games, you know, the thing that actually makes money, or do you give up on at least some of that in favor of building the reasons for people to buy an Xbox over a PlayStation? I mean, I think they're gonna make this decision on a case by case basis. I mean, it would be crazy to take something like Forza off the PlayStation and games like Call of Duty have already been committed to stay multi-platform for basically ever. But there will be at least some big games that only land on Xbox and PC going forward, it's just gonna take a while to actually make an impact for them. Exclusives are one part of the story, but value is another. The current generation has been rough, but the silver lining has largely been the Xbox Series S. At $300, at least up until recently, it has been the cheapest ticket into modern gaming. And I know a lot of people who have picked one up, signed up for Game Pass, and are still really happy. Except they hiked Xbox prices twice last year and are reportedly still losing as much as hundreds of dollars per console right now. With the RAM crisis, even $650 for a Series X just isn't sustainable. This whole thing is still getting a lot worse. So exclusives are part of the story, price, unfortunately, probably isn't. Even Microsoft with their deep pockets can't afford to lose big cash on every console forever. Maybe the answer is building a badass next gen console? I mean, sure, a super powerful Project Helix would be great, but once you get above like 1,000 bucks, which it almost certainly would be, it is always going to be a more limited kind of device. And what I'm hearing is that they're considering how to scale it back and cut costs regardless. Who knows what Helix actually looks like at launch. Finding a real reason for why you should buy an Xbox is just a tough sell right now. You can't even really blame Sony here. I mean, look at the problems. Microsoft chose to bring Halo and Forza to PlayStation. Even the RAM crisis kinda comes back to Microsoft in a way. They're spending $190 billion on CapEx in 2026, most of which is going to their AI build out, you know, the thing that's causing the RAM crisis to begin with. Look, there's no way around it, things are bad for Xbox. There's a real reason for some real drastic changes, spinning Xbox off into its own standalone company, cutting studios, or even just calling it a day on console hardware entirely. But I do think there are things that Asha and the team can do for the next 100 days that can make a difference. First of all is the biggest one, get Windows right. The biggest strength of a console is the simplicity and the it just works factor. Having the flexibility of Windows is great, and while Xbox Mode is an improvement, it is not there yet. Now, they've still got time, but this has to be priority number one, it is the foundation for the entire next generation Xbox platform. But you've gotta make it easy and clear to understand what's an Xbox versus a PC. The details matter here. Make the true Xbox version of Windows its own thing with a guaranteed set of features, like full Xbox backwards compatibility and clear performance tiers. Then, ship Helix. Now, my understanding is that it's largely built and paid for at this point, at least on the development side. But, look, you don't have to rush it, no one is clamoring for brand new hardware, at least not yet. Take the time to lower the costs, scale it back, whatever you gotta do. But I do think putting a real next gen Xbox on shelves matters. Hopefully, they can do this along with a true affordable Series S successor, and probably, by opening up the Xbox brand to more third-party hardware like the Xbox Ally. And then, lean all the way in on games and exclusives. Sure, I mean, keep things going on a case by case basis on what games are true exclusives, maybe which ones are timed, and which ones just go straight to the PS5, but now is not the time to gamble on new and unproven concepts. Get Elder Scrolls VI out the door, give us an actually new Halo game, remake Fallout 3 or New Vegas. How about StarCraft 3? Look, I don't care which of these you actually do, but just green light and fast track some of these obvious slam dunk games to not only bring some much needed revenue in, but also to have some real next gen titles to sell Project Helix and Game Pass. And finally, the hard one, sort out the business side. Game Pass is still the best answer Xbox has, so just fully commit. You can't ship a next gen console at the price you want? Bring back Xbox All Access and bundle the hardware with Game Pass in a reasonable monthly price. While you're at it, give away the easy stuff, make Xbox Live Multiplayer actually free. If you're shipping a PC, you kinda need to do this anyway, since no one pays for online on PC outside of specific titles like WoW or EVE Online. Announce the free multiplayer at the right time when you tweak the Xbox Game Pass tiers, and eventually, release that free ad-supported version that's been teased forever. (Austin sighing) Okay, I'll admit, this is a lot, and the Xbox team certainly has a better picture of what to do than I do. But look, this is a rare opportunity, not everyone gets the chance at a real reset. This can be an opportunity to ensure that Xbox can build to become a truly healthy business again. They have all the pieces, maybe they're a little broken and scattered right now, but, look, I know this is a very difficult task, but I do think it's fixable. I also think the next 100 days are going to be a wild ride, but I'm gonna be here for it. If you too wanna be here for it, make sure to subscribe to the channel and ring-a-ling that ding-a-ling button. And definitely stay tuned, it is about to get real, real spicy, for good and for not so good. (suspenseful music)