The console war is irrelevant to Xbox

Xbox remains a major competitor in where people will play, pay for and engage with their games

The news that Halo is coming to PlayStation last week felt momentous. At least to people of a certain age.

On paper, Halo isn’t what it once was. And Microsoft now owns and operates much bigger brands, including Minecraft, Call of Duty, Diablo, Forza Horizon, Fallout, Candy Crush, Elder Scrolls… Halo isn’t even the company’s Top Five anymore.

But Halo is the original Xbox system seller and its lead protagonist, Master Chief, is the closest the company has to a gaming mascot. He’s Xbox’s Super Mario. It’s like the day Sonic came to Nintendo GameCube. War is over.

Except it isn’t. Xbox has been defeated in the hardware space (broadly speaking, it’s still making machines), but there’s a bigger, more complicated platform battle taking place. One that’s far more significant, and one the company has spent considerable time, and the GDP of a small country, in fighting.

When the Activision Blizzard acquisition attracted opposition from regulators, there were a lot of headlines around the harm it would do to PlayStation. But by the end, that wasn’t what the regulators were most concerned about. For them, it was about the unknowable future. It was about how games would be bought and distributed in ten years. What will the next-generation platforms wars look like?

Will we all be streaming games? Will we be subscribing to them? Will it all be free-to-play? Or… will it be $80 games downloaded onto $600 game machines? Or something else entirely? It’ll inevitably be more nuanced than that. But regardless, if one, or all, of those futures come to pass, then Microsoft will find itself in a potentially powerful position. It has the services, it has the technology and it has the games.

What even is a game platform anyway? There has been some derision of the much talked about ‘This Is An Xbox’ campaign. Even I quipped once that it was a bit like Sega calling the Nintendo GameCube ‘a Dreamcast’ because it played Sonic The Hedgehog. But that isn’t fair. The platform war of 2000 is vastly different to the one of today. If you’re playing an Xbox game, with the Xbox UI, via an Xbox service with an Xbox controller… does it matter who manufactured the machine you’re playing it on?

Not feeling obligated to a pre-existing business model could prove freeing. By no-longer focusing on hardware, Xbox will have no hesitation in putting its games and services wherever it sees an opportunity. It isn’t worried about protecting the machine under the TV anymore, whereas its historical competitor (Sony) is worried about that.

“If you’re playing an Xbox game, with an Xbox UI, via an Xbox service with an Xbox controller… does it matter who manufactured the machine you’re playing it on?”

Microsoft’s studios boss Matt Booty said that Xbox’s competition is actually TikTok and movies, rather than other consoles. That’s true in the sense that every developer and publisher is competing with TikTok and movies. And that’s not new. Video games are part of a wider ecosystem of things people choose to spend their spare time and money on. Granted, that space is noisier and more competitive than ever. And games may not be as trendy as short form video right now. But it is competition that’s always been there in one form or another. We just need to do what we’ve always done, which is come up with new, engaging and exciting games. That’s the challenge the whole industry is expected to rise to.

TikTok may be something for Xbox as a game maker to worry about. But as a platform, there is also an expanding number of competitors to deal with, including Roblox, Fortnite, Steam, Netflix, Amazon and yes, PlayStation and Nintendo, too. These are all places where people engage, play, and pay for their games.

Microsoft is very much a participant in this modern platform battle. But it has work to do. It still lags behind most of those aforementioned competitors (and by quite some margin). Windows 11 as a gaming platform isn’t good enough, not yet. It’s not clear if streaming can ever become a mainstream proposition. Or how much player growth there is in subscription services. And although its games line-up has improved greatly, customers seem primarily interested in accessing them in places outside of the Microsoft ecosystem.

Yet make no mistake, although the console war of old may be over, it’s just been replaced with a far bigger, multi-faceted platform battle. And it’s one Microsoft aims to lead.