The Interviews Of Phil Spencer - To P3 And Beyond



CNBC:
It does appear to be an arms race. Everyone's getting incredibly acquisitive at the moment. So, aside from Activision and potentially what happens there, are you still looking to remain acquisitive because you've got Tencent really starting to get involved in the space now. You've got Sony nibbling at the edges. Or is it just about waiting and seeing what happens with Activision and then pressing pause for a little bit in terms of buying up other studios?

Phil Spencer:
Yeah, I mean you mentioned it, you nailed it. This is such a competitive market. I don't think we get to press pause on anything. Uh you know, Tencent is the largest gaming company on the planet today and they continue to heavily invest in gaming content and game creators. Sony is a larger business than we are in gaming today and they continue to invest. When you look at the investments that we've made, it's a highly, highly competitive market. We strive to be a major player here. We want to deliver great content for our players and we're going to remain active. Like I said, whether that's investing in our internal teams that are already building great games that people know and love. Whether it's building new partnerships.

And one of the things I love about coming here to Tokyo is the developers. I get to meet with the new partnerships we have with people like Kojima Productions and going to talk with some of our existing publishing partners and independent creators about games that we want to build. And if it turns into acquisitive M&A work, we're active there too. So the work for us never ends. It's a competitive market and I want to make sure Xbox is at the forefront of innovation and competition.

 



00:00 - INTRO Special Guest
00:43 - Xbox Series S Easter Egg
01:46 - Rivian podcast to come
02:24 - 2nd anniversary Xbox Series X|S launch
02:40 - COVID impact on industry
04:23 - Gamepass Growth
06:01 - Xbox play anywhere
07:06 - Microsoft collabs
07:48 - CoD impressions
09:55 - Games currently playing
12:58 - Halo X Haworth
13:49 - Minecraft X Burberry
14:51 - Surface Tour
16:34 - Custom Elite Controllers
20:23 - Future of Xbox
23:11 - new generation, new way to play
24:25 - taking criticism and feedback
26:49 - Activision Deal
31:21 - Phil's favorite snack
33:27 - Forza Horizon & Motorsport thoughts
35:22 - What Phil's most excited for
37:28 - Travel and connecting in person
40:01 - Phil's message to the fans
42:11 - Outro/Phil and Panos Fall Guys night
 


Activision acquisition:

I'm more confident now than I was a year ago, simply based on the information I have and the discussions that we've been having.

Hi-fi Rush shadowdrop:

Yeah, the shadow drop, it seems like it worked really well this time. It's not a thing we've done a ton of. This was an idea from the team. They'd been playing the game, felt good about their launch date and some of the early signals on quality, and said, "Hey, it would just be fun. It would just be fun to be able to launch this during the Developer Direct and say, 'Play it now.'" So we rolled with that. We're always learning, always listening, and it seems like the community's responding well, which I think is a good signal.

Forza delay:

I know there were some questions on the date on Forza Motorsport, because we just revealed the year. Everybody should know just the quality that Turn 10 puts into Motorsport, if you look historically, is going to be there in this game. That's the thing that, first and foremost, is most important, and we will come out with a date, no doubt when we're a little bit closer. But we just wanted to reaffirm to people that this is a 2023 game.

Underperformance of xbox/ slowing gamepass growth:

Well, one thing with Game Pass is we're kind of in unchartered territory in doing what we're doing with Game Pass in the industry. So it's harder for us to go out there and look at examples to help us gauge how fast we should be growing. We're at an all-time high for paid subscribers, and Game Pass, it continues to grow. I'm happy with the growth. We set high internal targets, and people see sometimes we miss those targets, sometimes we hit them, but I'll always be ambitious about what we're trying to do.

I'd say the quarter numbers that you're talking about with software and services...one of the things to remember is that's a year-over-year comparison. Last year in that quarter, we had Age of Empires, we had Forza Horizon 5, we had Halo Infinite. All of those did really well for us, and as we pointed out, we didn't have that big release in that same quarter of this year.

Layoffs:

As somebody who's been on Xbox for an awful long time, it's always a challenge whenever a coworker...a team member is not going to be on the journey with us going forward. I take to heart the impact on individuals. I see my commitment and my responsibility as the person who heads the business to create a safe place where people can do their best work. And obviously, we have reductions for certain people there. I haven't succeeded at that.

My commitment is to the business, to the customers, to the teams. I think running a successful business is part of creating a stable place for our team members. The long-term vision that we have on Xbox of building our experience around the player, allowing creators to build games that can reach players on any screen that they want to go play, giving players different ways to build their library, whether it's buying their games, subscribing to their games, looking at access like xCloud and the work that we do on PC. I'm a strong believer in that vision.

Right now, there's some business that we're having to work through, and part of that is making sure that we have the right resources in the right places to do the best work. Sometimes, that means we have to make some allocations, in this case, some reductions, and I don't take that lightly, because the impact on the individuals is real. But it is, I think, important for us, for the larger organization that's here, that I put this business in the best stable position I can for what we need to go forward, which in the end should create a better place for the great team members that are here building the things that they're building.

343 situation:

At the same time, when we launched that game, we know we needed to make some commitments to people about the content updates and our timing on those and the quality, and we didn't hit our own bar for doing that. I believe in the team that's there, Pierre and the leadership team, and the plan that they have. Obviously, [343 studio head Pierre Hintze], he's the studio head now, has been on Halo for a long time. He's worked on [Halo: The Master Chief Collection, he's done some great work there. The team has a very good plan.

What we're doing now is we want to make sure that leadership team is set up with the flexibility to build the plan that they need to go build. And Halo will remain critically important to what Xbox is doing, and 343 is critically important to the success of Halo.

In terms of support studios and other things, that's just part of development and having other partners help us. But the heart and soul of Halo is with 343 and the team that's there, and I have the utmost confidence in the team that's there and leading and the plan that they have going forward.

Activision:

Given a year ago, for me, I didn't know anything about the process of doing an acquisition like this. The fact that I have more insight, more knowledge about what it means to work with the different regulatory boards, I'm more confident now than I was a year ago, simply based on the information I have and the discussions that we've been having.
...
So my confidence remains high. We're actively working with the regulatory boards around the world that need to approve for this, and it's been a learning experience for me. A lot of time spent, a lot of travel, a lot of conversations, but they're conversations where I get to talk about our industry and the work that we do and why we do it. I think the more regulators are informed about what gaming is, how the business runs, who the players are, and what our aspiration is as Team Xbox is just a good thing for the industry itself.
 
karmakid said:
Hat tip to @Grimmy

Click to expand...


Xbox is going the way of becoming a multiplatform subscription service it seems

"We're not in the business of out-consoling Sony or out-consoling Nintendo. There isn't really a great solution or win for us, and I know that will upset a ton of people, but it's just the truth of the matter.

When you're third place in the console marketplace, and the top two players are as strong as they are, and have, in certain cases, a very discrete focus on doing deals and other things that make being Xbox hard for us, as a team.

I see commentary that if you just build great games, everything would turn around. It's just not true that if we go off and build great games, all of a sudden you're going to see console share shift in some dramatic way. We lost the worst generation to lose in the Xbox One generation, where everybody built their digital library of games. So when you go, and you're building on Xbox, we want our Xbox community to feel awesome. But this idea that if we just focused more on great games on our console, that somehow we're going to win the console race, I think doesn't really lay to the reality of most people.

There is no world where Starfield is an 11 out of 10 and people start selling their PS5. That's not going to happen." - Phil
 
  • Like
Reactions: Kvally
DriedMangoes said:
Xbox is going the way of becoming a multiplatform subscription service it seems

"We're not in the business of out-consoling Sony or out-consoling Nintendo. There isn't really a great solution or win for us, and I know that will upset a ton of people, but it's just the truth of the matter.

When you're third place in the console marketplace, and the top two players are as strong as they are, and have, in certain cases, a very discrete focus on doing deals and other things that make being Xbox hard for us, as a team.

I see commentary that if you just build great games, everything would turn around. It's just not true that if we go off and build great games, all of a sudden you're going to see console share shift in some dramatic way. We lost the worst generation to lose in the Xbox One generation, where everybody built their digital library of games. So when you go, and you're building on Xbox, we want our Xbox community to feel awesome. But this idea that if we just focused more on great games on our console, that somehow we're going to win the console race, I think doesn't really lay to the reality of most people.

There is no world where Starfield is an 11 out of 10 and people start selling their PS5. That's not going to happen." - Phil
Click to expand...
Too late
 
  • Hmm
Reactions: DriedMangoes
DriedMangoes said:
Xbox is going the way of becoming a multiplatform subscription service it seems
Click to expand...
He has confirmed that they don't see higher than a 15% subscription rate for Game Pass, and their focus is entirely on Xbox first, Microsoft Windows PC, and Cloud via devices like Android and iPhone.

I love that he confirmed their massive commitment to great games coming. I think he kinda accidentally had a surprise in the interview. When asked about upcoming games, he mentioned 2023 games AND Hellblade 2. If we see Hellblade 2 in 2023, that is massive add to what they are already putting out.
 
  • Like
Reactions: karmakid
Pureshooter said:
Are you trying to imply that they're going to stop making the Xbox? Because that is not at all what I took from that.
Click to expand...
PS fans will say that, even though Phil said TWICE during the interview that Xbox console is the core and priority of the business.
 
Kvally said:
PS fans will say that, even though Phil said TWICE during the interview that Xbox console is the core and priority of the business.
Click to expand...
Exactly. He just said that outselling Playstation and Nintendo isn't a reality or a priority. You can still be massively profitable and successful without selling as many consoles; even more so potentially.
 
  • Like
  • Winner
Reactions: menace-uk- and Kvally
DriedMangoes said:
Xbox is going the way of becoming a multiplatform subscription service it seems

"We're not in the business of out-consoling Sony or out-consoling Nintendo. There isn't really a great solution or win for us, and I know that will upset a ton of people, but it's just the truth of the matter.

When you're third place in the console marketplace, and the top two players are as strong as they are, and have, in certain cases, a very discrete focus on doing deals and other things that make being Xbox hard for us, as a team.

I see commentary that if you just build great games, everything would turn around. It's just not true that if we go off and build great games, all of a sudden you're going to see console share shift in some dramatic way. We lost the worst generation to lose in the Xbox One generation, where everybody built their digital library of games. So when you go, and you're building on Xbox, we want our Xbox community to feel awesome. But this idea that if we just focused more on great games on our console, that somehow we're going to win the console race, I think doesn't really lay to the reality of most people.

There is no world where Starfield is an 11 out of 10 and people start selling their PS5. That's not going to happen." - Phil
Click to expand...
Not anytime soon, and what Phil said doesn't lend weight to that take either.
 
I thought it was interesting that he said Redfall scored double digits below what their internal reviews projected. They were probably anticipating mid-high 70's.
 
  • Hmm
Reactions: karmakid
Kvally said:
He has confirmed that they don't see higher than a 15% subscription rate for Game Pass, and their focus is entirely on Xbox first, Microsoft Windows PC, and Cloud via devices like Android and iPhone.

I love that he confirmed their massive commitment to great games coming. I think he kinda accidentally had a surprise in the interview. When asked about upcoming games, he mentioned 2023 games AND Hellblade 2. If we see Hellblade 2 in 2023, that is massive add to what they are already putting out.
Click to expand...
I said when these consoles launched that 2023 would be the start of Xbox. I'm still believing that.
 
  • Hmm
  • Agree
Reactions: Kvally and karmakid
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