Microsoft says it has lost the Xbox vs PlayStation console war

Microsoft Considering Leaving Games If It Doesn’t Significantly Grow Beyond Console

Xbox chief Phil Spencer told the court in a recent hearing that if Microsoft‘s gaming division doesn’t significantly grow beyond the console, it may end up exiting the games business altogether, leaving PlayStation with no rival. Spencer’s deposition was recently made public and sheds more light on Microsoft’s push into mobile and PC.

Microsoft-Activision deal goes beyond PlayStation vs. Xbox console wars

It’s no secret that Microsoft’s console business has been in the doldrums for a while. Even the Xbox Series X|S is currently behind Xbox One’s sales on a time-aligned basis. As a result, Microsoft has been pushing Xbox Game Pass on PC and console and has repeatedly said that it wants to make a splash in the mobile market.

Explaining an internal company chart about the future of Microsoft’s gaming business, Spencer told the court that he can “fairly safely say that if we do not make more progress than this off of console, we would exit the gaming business.”

Spencer added that if Microsoft doesn’t succeed in the mobile and PC gaming business, he would not advocate for the company to go back to a closed device like Xbox. “If we don’t gain a foothold on mobile, there’s really no future for us, in Microsoft investment in gaming,” Spencer reiterated.

Spencer also revealed that one of the first questions Microsoft’s CEO Satya Nadella asked him when they met was why the company was still in the gaming business after difficult years. Spencer is of the view that acquiring Activision Blizzard King will be the gaming division’s saving grace.