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Microsoft Closes Xbox Entertainment Studios as Part of 14% Staff Cut

by on18 July 2014 1756 times

Microsoft has announced that they will be closing the doors on their Xbox Entertainment Studio. This move is part of the recent job cuts that new CEO Satya Nadella announced. Nadella is slimming things down as part of a mobile first, cloud first initiative, but also with the intention of re-focusing Microsoft on things that area important to the product in question. If you remember gamers were not that happy with the “more than a gaming console” spin that Microsoft put on the Xbox One.

Microsoft had intended the Xbox One to be a home theater device that could also play games. The vision from Steve Ballmer was to have the Xbox One as part of a connected home eco-system which extended to your phone, tablets, and of course the PC. The experience would be the same on all of your newly minted Microsoft devices. The problem with this is that most consumers do not want that level of ubiquity. Each device in the home has a different purpose and the push to make the Xbox the center of that was (and still is) a bad idea.

Xbox Entertainment Studios existed to develop original TV programing for the Xbox as part of the drive to make it more than a gaming device. During E3 2014 we saw the beginnings of a move to return the focus to gaming after sales fell behind rival Sony’s PS4. Apparently the studio will be allowed to finish current projects, but will soon close its doors for good.

There is an interesting twist to all of this though. According to a leaked memo from Phil Spencer Microsoft will continue to build the entertainment side of the Xbox alongside the renewed focus on gaming. He stated: “our app partnerships with world-class content providers bringing entertainment, sports and TV content to Xbox customers around the world are not impacted by this organizational change in any way and remain an important component of our Xbox strategy”. This statement would seem to be at odd with Nadella’s request for Microsoft to rediscover their soul. The Xbox gained popularity by being a good console with a large selection of AAA titles, not because you were able to watch movies on it.

I guess we will have to wait and see if Microsoft will truly become a more focused company or if they will continue to wander aimlessly right on the edge of the cloud and connected home.

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Last modified on 18 July 2014
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