I‘ve been fairly critical of Microsoft in the past, particularly regarding its handling of Xbox. Lackluster game releases, high-profile blockbusters that ended up massively disappointing, the whole Redfall situation, shutting down Tango Gameworks (which is thankfully back up again under a new publisher) – it’s a long list. Yet, when it announced that it would publish its first-party games on other platforms, I didn’t immediately hate the decision. Sure, console wars and all that jazz, but if it means more people would enjoy incredible games like Sea of Thieves and Hi-Fi Rush, well, why not?
That decision turned out to be quite successful, with Forza Horizon 5 and Indiana Jones and the Great Circle actually topping PlayStation Store sales. Then. there was the decision to tie up with Asus for the ROG Xbox Ally. Rumors of an Xbox handheld circulated for some time, and given the shape the portable PC market has taken, it wouldn’t have been the worst decision. However, with console sales remaining stagnant and Microsoft’s inexperience, I was skeptical. The Xbox Ally is a nice middle ground, providing a solid handheld to enjoy Game Pass titles and still access platforms like Steam, even if the alleged prices – $499 for a regular Ally, an eye-watering $799 for the Ally X – aren’t the most affordable.
Then came the announcement of Microsoft and AMD continuing their long-term partnership. Ordinarily, this wouldn’t be a big enough deal to warrant a video from Xbox president Sarah Bond, but it was. That’s because she confirmed that this multi-year partnership would see AMD “co-engineer silicon across a portfolio of devices, including our next-generation Xbox consoles — in your living room, and in your hands.”
There’s the usual marketing talk about “advancing the state-of-the-art in gaming silicon to deliver the next generation of graphics innovation to unlock a deeper level of visual quality” and “maintaining compatibility with your existing library of Xbox games.” The part about “immersive gameplay and player experiences enhanced with the power of AI” was concerning. If you haven’t seen the AI-generated version of the game made possible by Copilot, consider yourself lucky (or look up and down rapidly if you want to break it).
However, Bond ended by stating the overarching goal – “Building a gaming platform that’s always with you, so you can play your games across devices and anywhere you want. Delivering an Xbox experience designed for players — not locked to a single store or tied to one device.” Xbox is thus “working closely with the Windows team” to make it the “number one platform for gaming,” and the “next generation of Xbox is coming to life.”
Several questions come to mind, but let’s start with the most obvious: Why? Why more Xbox consoles?
This may sound like a hot take, but Microsoft’s own numbers don’t lie. It’s Activision Blizzard King carrying the Gaming segment. Xbox hardware sales haven’t stagnated – their revenue has actually declined year over year. Even before prices increased worldwide, very few people wanted to buy an Xbox Series X or S.
And at this point, who can blame them? Not Microsoft, certainly, because while it hasn’t gone as far as to call the brand “poison,” it’s done so much to convince everyone that an Xbox doesn’t have to be an Xbox. It could be your Smart TV, your PC, the Steam Deck (if you run Xbox Cloud Gaming through Microsoft Edge, that is), and at this point, even a PlayStation 5, limited number of titles be damned. Yet, oh boy, here goes Xbox again, making another console that may not sell that well.
I don’t blame fans for getting hyped about it – there was some backlash against Microsoft for seemingly “abandoning” the Xbox by bringing its exclusives to other platforms. However, announcing a next-gen console doesn’t automatically guarantee that it will suddenly abandon its third-party plans. Once it’s tasted the sweet additional revenue from other platforms, helping to make up for the lack of hardware revenue and expensive Game Pass deals, there’s no chance it suddenly pumps the brakes.
Microsoft has repeatedly said that it’s not leaving the console business. It also seemed a given that a new Xbox console was coming (if those leaked documents during its court case with the US Federal Trade Commission weren’t enough). However, so much has changed in the past year that it seemed like the company would break the cycle.
This is why I don’t think it’s as straightforward as simply making another console and hoping for the best. Bond mentioned a next-generation console in your living room but also “in your hands,” seemingly indicating that Microsoft’s own dedicated handheld is still in development, despite the rumors. The fact that it’s embracing multiple storefronts and sharing the experience across devices indicates more than just a portable PC.
Perhaps Microsoft is designing the next Xbox to fully incorporate Windows, making it almost indistinguishable from a PC yet also a hybrid solution – something that can connect to your living room TV but also be used on the go. That may sound too much like the Nintendo Switch: Windows Edition, but remember that the Steam Deck can also function as a full-fledged PC when connecting it to a display, mouse and keyboard (complete with a desktop experience). Perhaps that’s the experience Microsoft is going for – an all-in-one device that could accommodate multiple audiences. And while Game Pass is already tempting enough on its own, especially with first-party titles launching on day one, allowing players to access their Steam library on it could also seal the deal.
Of course, considering the ROG Xbox Ally is still a thing, this speculative new platform would have to offer something more. Something unique to stand out and drive hardware sales if that is indeed the goal. I highly doubt that Microsoft would make as big of a deal of its AMD partnership if it was just creating another screen for its “This is an Xbox” campaign.
It’s also possible that the ROG Xbox Ally is a test run of sorts – the company dipping its toes into the handheld PC market to gauge the response. If it’s successful, perhaps it may attempt to wade even deeper into the space with its own device. And if not, it could always fall back on a traditional console, as adamant as I am that it breaks the cycle.
Then again, with rumors of PlayStation’s next console also taking a handheld approach, maybe Microsoft knows something that the wider public doesn’t. Perhaps the market for handheld gaming with a PC-like ecosystem is much larger than it seems (PC Game Pass subscriptions did grow by over 30 percent as of the second quarter of this year, after all). It may anticipate Sony potentially cornering its own share of the handheld console market, and instead of competing, Microsoft is attempting to consolidate its advantage on the PC side. PC gaming belongs to the House of M, and if it can present an affordable gaming solution that fulfills all roles in the living room, mobile, and desktop space, it may find a new avenue of success unlike any other.
Yes, games will still matter, but on that front, Microsoft has been delivering on a pretty consistent scale. After all these years and those long, barren stretches of no releases, it’s finally in a position to release multiple hits in a row. All it needs to do now is figure out how to create a killer platform that fans will pay to experience them on.
Note: The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, GamingBolt as an organization.