Why does Xbox need to make a brutal reset?

This week we have more stats about Summer Game Fest. Lucy James tells us about her new media publication and of course we discuss the imminent changes at Xbox.
[music]
Hello and welcome to the Game Business Show. This is our first proper recording since we've landed back from Los Angeles. Last Thursday we had our big Matthew Ball interview of course which did incredibly well. Thank you to everyone who tuned in for that. Uh we had our micro on Monday but that was of course only for paid subscribers. And if you're interested in being a paid subscriber you can find out how at gamebusiness.com. So this is our first proper post Summer Game Fest chat and to have that chat with me is the co-host of the Summer Game Fest showcase but also the writer and co-founder of Looking for Game a new newsletter which is sort of a sister brand to the Game Business. I am of course on
Yeah we're colleagues now.
Well yeah. I am. Um I think we are. I don't know. I I it's I don't
Should we get a Slack going?
Yeah. I got added to a Slack at some point. I think Jeff put me in one. I don't There is one somewhere. We should We should We should Yeah.

I'm in a Slack with First Look and Jeff's in there which my like tech partner platform holders.
Yeah.
But that's mostly to be like can you guys make this? Yes. Here you go.
I'm actually going to introduce you now. I'm talking about Lucy James. Hello.
Sorry. [laughter]
Um Hi Lucy. Um I think we're sisters and I think Yeah why not? You know I've got I've got I've got employees now. I've got um
Yeah. Bloody hell.
We already had a Richard producer. He's brilliant. And we just hired George Corner. He's on the commercial side of things for us. So um
Incredible.
Yeah probably we do need a Slack. Can't just be done on text messages. People get fed up with me. Um
Yeah I don't have employees. I've got two cats.
Uh
If anything I'm the employee.
There's a There's a cat in this room so I might have to I We'll shut the door and everything. But anyway Look we've launched a new thing. You've left
I have.
Uh you've left the embrace of GameSpot and you've signed up Looking for Game. So go on, tell us tell us what that is.
So looking for game is so it feels weird

to be Lucy from looking for game and not Lucy from GameSpot.
How long were you at GameSpot?
12 years.
Yeah, okay. Yeah, that's weird. That's weird.
Uh so looking for game is a weekly newsletter where I just uh send you indie game recommendations and where I can exclusive demos and play test invites. So for me like as we all know game discovery is really broken. We'll talk about Steam Next Fest uh probably in a moment. But as someone who works at one of the big websites and seeing all of the cool games that would come through that we just simply didn't have the time or the place to cover, I realized over the past couple years that my, you know, I really just enjoyed the experience of the smaller games talking about indies and sharing that experience with others and I was lucky enough to find this community of people, especially on Friends per Second which is the podcast that I have. Um the the people that really like those games and wanted those uh different experiences that aren't just necessarily the same I'm not saying this to be

uh you know reductive, but you know, like they didn't want the big triple A experience every year. It's like they want to just a smaller handcrafted uh more human stories. Like I think indies have more of a chance to get weird with it and whereas triple A can't really afford to take that many big swings anymore. So I found this community and um realized that hey, people people want this and so I didn't want to leave. I mean, I miss GameSpot obviously, but it's like I didn't want to leave for something that I wouldn't be happy doing and I wouldn't feel you know, like I love logging on to my Slack every day, but not to to Steam and to email and just seeing what's out there and then talking about it and sharing them. And so every week send you a new game recommendation. Although the the past few weeks have been a little different because there it's all showcases and Steam Next Fest. So it's more been a collection of things, but going forward it'll be like one big game recommendation, and I'm working with developers and publishers to like send demo keys out. Cuz the other thing is I'm so guilty of this, too.

Um is that I'll see a game on a social media, and I will go wish-list it, but then when it actually comes out, I'll be like, "Oh, I remember I did that, but I don't feel the need to buy it." And so, my goal is to kind of do the foot-in-the-door thing where it's like, "I'm sending you the demo key. You can try it." And then hopefully that means that when the game comes out, you will remember it more and and hopefully like just remember the good time that you hopefully have with the demo and and buy it.
So, is it is it it's newsletter? It's once a week? Is there Is there cuz you're you're famous face in the in the world of generally? Is there Is there a video? Is there any of that?
Yeah, I Yeah, I'm also doing short-form video. And um if you're a paid tier, there is a Discord. And so, I It's really nice in there. Like the pet channel is popping up. People are already recommending and talking about games, and that was exactly what I want. And then yeah, there'll be extra newsletters uh for paid subscribers, which will be more kind of I think my general thoughts on industry and trends that I'm seeing. Spoiler alert, a lot of

Dredge-likes at the moment.
Oh, okay.
There are bloody millions of Dredge-likes. Um and so, yeah, it's obviously been a hectic few weeks.
Is Dredge-like a genre now? Is that a
I'm coining it.
Yeah, okay.
And you hear it here first. Um yeah, so obviously it's been a whirlwind. And I think I had 4 days between leaving GameSpot and the launch. I launched it from gate gate D8 uh San Francisco International Airport.
Oh, no. Okay. Well.
And then I then I literally like I launched it at 9:00. And then I was on the flight to LA, so I had to I was like, "I'm not going to buy Wi-Fi. I'm not going to buy Wi-Fi." And then I did buy Wi-Fi. I had to check that out actually to see how it was going.
I right, I launched GameSpot I was in GDC, but I was doing it the day I came back from GDC. That was the plan. But, um I don't know if there was a fire at Heathrow Airport. Yes. And so, I flight a flight home, and then I had to fly back, and then I ended up I did actually get to do it from home, but it was

getting very close to having to launch the Game Business from a from an airplane Wi-Fi, um which wouldn't have been great. And so, yeah, you you've been It's been a whirlwind. I guess there was the Summer Game Fest launch um that you had. [clears throat] Um you know, I was deeply upset that you know, you got a plug on the stage at that um at Summer Game Fest, and I didn't. I mean, I Where was my um You know, if you like numbers,
[laughter]
um you shouldn't know. Um I'm joking, obviously. Um they had that moment, and of course, there was lots of games. There were lots of indie games that um Day of the Devs and all sorts of things going on that week. And then, um then Steam Next Fest. But, you're telling me just before I press record that it's it's a bit of a
It's a strange Next Fest. I mean, I'm spending more time today digging through Next Fest is um always a very valuable tool for discovery, but it's a double-edged sword because I mean, I got the email through Steam, and it was like, "Okay, you know, look, 5,000 Here's a spreadsheet of 5,000. These are all the games that are in Next

Fest." So, that's not to say that like these demos are new. A lot of them are just updated ones. Um And yeah, I I I mean, I will say, if you are a game publisher or developer, and you have your game in Next Fest, but you're not announcing it before, like if you embargo it until the first day of Next Fest, don't do that. Don't do that cuz you need to get that as much runway as you need to stand out from the crowd. There's lots of really good things in it, but it doesn't feel like there's the one game Like I remember when Blueprints was in Next Fest last year or the year before. You know, it doesn't feel like there's one of those quite yet. Maybe maybe, you know, we're recording this on Wednesday morning. Maybe today will be the day that I uncover something or I see a tweet, and I'm like, okay, yeah, that's the one.
Oh.
But yeah, it's good. It's It's interesting. It's like I just download so many of them and just get through them.
How many would you say there were?
In the spreadsheet, there was around 5,000.
5,000?
Um a little I think a little [snorts] under, maybe like 4,800.
Oh, wow.
But that's the thing, it's like your your game, you can just tag it as being

part of Next Fest.
If there is something that comes out of Next Fest, people should be all looking for game and and yeah.
Yeah. And I guess I already did five recommendations. Um yeah, Bird 9 is is my game of Next Fest so far.
Hm.
It's Metal Gear Solid, but you are the man in the chair instead. So, it's more of a visual novel.
You did the I saw the TikTok. Um that's how I discover things. Um
[laughter]
I remember when um um Devin Pritchard from Nintendo said that oh, I watch your stuff on TikTok, and I was like, what? And I realized now I'm that I'm that older person who's watching videos on TikTok. Um why is it dusty? And so, and you you give these demos like you partnered with First Look? Is that the name of
So, player.gg.
That for the demos and they and [clears throat] then that kind of thing. It's really exciting.
So, instead of instead of Substack or Ghost or Beehive, just because yeah, I mean, I've said this before, but it's like, you know, had a very uninspiring meeting with not Substack

and with Beehive. Um and it was just like they they just didn't care about you know, it for them, it's just another newsletter. And so, when the difference is going to First Look and player.gg, it's like they were like, no, we understand like we help and talk to developers and publishers and we get games out to playtest all the time. We understand this, and so, working with them makes more sense for what I'm doing, especially with key distribution. And also, they're really great. Uh they are so responsive, and if I have a question or if I have an idea, they are just in Slack trying to figure out a way to make it work, and they make it work all the time and it's great.
I saw you had a pop at Substack. Just We're supposed to be sisters here. Hey.
No, no, no. The thing is like Substack is what I use for Friends Per Second, but Substack doesn't doesn't have a video game category.
It's a bit weird.
I have to do um for Friends Per Second, I have to do culture and technology.
Yeah, it's what I did. Yeah. Um maybe I've got business selected as well. I don't know. Yeah. It is I don't really think much about it. Um there's people

like Stephen Totilo's on there and
Yeah, Totilo's on there. Schreier's on there.
And we're all slightly B2B so we sort of recommend each other, but it's um
Yeah. Simon Carless, video games industry member from George Osborne, like we're all on there. Yeah, I mean the thing that Substack has is the the social networking and the recommending of it all. Yeah. But First Look uh player.gg, it's like yeah, it's more for the hashtag gamers.
Shall we talk about Summer Game Fest?
Go on then.
It feels like an age ago already. Um I've got some stats. Do you Of course I do.
I would love some stats.
We've We've talked a lot about that. I've actually talked a little bit about the stats already about, you know, which games won Summer Game Fest. Ocarina of Time teaser was the most watched trailer followed by God of War Lefay Lofay Lefay. Um and then Resident Evil
Lofay.
Lofay.
Lofay? Cuz I I keep wanting to say Lefay like the singer, but that's apparently not correct.
How about naming games after somebody you can pronounce? That's my my advice.
It's hard to
And then Resident Evil Veronica was number three. Um Gears of War got a whole lot of press coverage because of that exclusivity and new Spyro trailer

did really well. Kingdom Hearts 4 did very well. Loads of games that did really well, but those are specific games we've sort of talked about that already. We know that Summer Game Fest show, the one that you were on Lucy, was a new record. Big number, over 20% up. Um incredible.
Go on I'm a green card package. You better believe it.
[laughter]
Um similar situation for Sony's State of Play. That was up 38% year-on-year for their stats peak concurrent viewers, I think.
Does it count the people at the Alamo Drafthouse, though?
How many people in the Alamo?
How many people were in the Alamo Drafthouse?
I I I have to say I don't know what you're talking about.
Oh, um oh, sorry. So, in the US, uh Sony owns the Alamo Drafthouse theater chain now. And they had people go watch the state of play, and they had um special Wolverine branded food. Although, the Alamo Drafthouse kind of sucks now because it used to be that you would order food and drink during the movie by putting like writing down on a piece of paper, and they would come and unobtrusively give you food and drink. But now, you have to use a QR code on your phone, and it sucks.

Oh.
It's my Thank you for letting me be on my soapbox about the Alamo.
All right, okay. Well, maybe maybe maybe if they're watching, they'll connect us all up.
They could be.
And Nintendo didn't do a direct last year, but this one was the this one was a particularly huge one according to Level Up. It was the biggest of them all, basically neck and neck with Summer Game Fest. Xbox was a bit flat, similar number to last year. I'm I'm a bit surprised by that. I would have for more considering Halo, Gears of War, Fable. But they're still doing well. Um And those stats have been out there last week, um but I now have a little bit more. Because I wanted to know uh specifically about the media side of things. So, um I was told by a couple of media people I can I people at RPG Site, VGC, and a few others that they actually saw traffic up a third in some cases, um compared this Summer Game Fest compared to last. Now, of course, there were more games, there was Nintendo. But um but still, that's obviously a great result. Um Level Up uh looked at the bulk of the games that were announced at Summer Game Fest, and there were some that slipped through the gap. They they tell me that, so this doesn't cover every game, but it covers most of them, at least certainly the big

ones. Um the data covers 168 game announcements during Summer Game Fest 2026. That's a 14% increase over 2025. This is why we need looking for game.
I know, there's just so many of them. Someone should really curate these best of the announcements.
When it comes to games that are not new, but had a big update like the Street Fighter 6 new season or the DLC to Hitman, Level Up filtered the data to only include those announcements. So, if you're just chatting about Hitman or someone's chatting about Street Fighter 6, that didn't make it in. It had to be specifically about what they announced it was. Anyway, in 2026 across those 168 games, Level Up tracked 56,900 press articles, which is a 15.2% increase on the number posted in 2025. In terms of social posts, it was a little bit less. It was a 5.3% increase to 45,800. And in terms of social interactions, it was a big jump to 57%. And I have to imagine that didn't include the speculation around what was going on between Geoff Keighley and Hideo Kojima. Um, this is this is all for a 2-week

period of June 1st to June 14th compared to a similar period in 2025. Look, there were more games announced this year. Nintendo did a direct this year, and this data wasn't exhaustive, but it was just a much, much bigger show, and it felt bigger. At least it did to me, and you were on the stage, so I don't know how it felt to you. But it But it felt like it just a really powerful It just felt It felt the closest we've come to the E3s of old.
I agree. I mean, I think yeah, PlayStation kicking off the week, and then I mean, even with a SGF starting with Veronica is a real mic-drop moment, especially given that Resident Evil Requiem closed the show last year. There was all the speculation about Veronica and being able to um yeah, just start with it. Incredible. And there was so many like And when I got when I found out what I was hosting, I was like, "Oh my god. Wow."
This is Do you know Do you know the rest of it, or do you just know what your bits are? I see.
my bits.
Oh, I see. You're given a script with

just your lines in it. Like, I see.
Yeah, but I don't know I mean, yeah, I'm just getting my my pages, basically. Oh, wow. Um but also like they are they're so careful about, you know,
Of course.
leaks and whatever. And so, even in rehearsal, there are some trailers that are just like, we don't see the final asset because that's the show day, which is really cool.
I think all of them had a thing, you know, there was a moment for all of them and you know, you think God of War and Wolverine starting and closing. Um, so anything I thought so I thought the Summer Game Fest show was extremely strong. Um, and again, Ragnarok and Final Fantasy with the Final Fantasy um, opening and closing and there was everything in between as well.
I was like Alien, uh, Stranger than Heaven, Sonic, like Oh, there was a big cheer for Gundam.
There was a big cheer for The Wolf Among Us 2. Yeah, yeah, yeah. Um, It was I actually liked the in-person thing. Afterwards I thought we need they all need to be in person now. There's always going to be cynicism on Twitter. That's always the thing that was back in the E3

days.
Yeah.
It when you're in when you're in the room but also I think when you're hearing it, you you hear that roar from the crowd. I know some people go, "Oh, I don't like the crowd stuff." But I think you can just imagine I just imagine what people would have done when Ocarina of Time logo came up. But that's just um, yeah.
I cuz I went to the last in-person showcase that Nintendo did. And I think that was
Was Wii U here? That wasn't it?
Yeah, 2012 13. And then they all they all moved online. And then PlayStation, you know, Xbox, like they all just started to do that little directs and you kind of can't I mean that's the thing that you say about the cynicism. I was like I would I was certainly cynical back then. I was I have a an app on my phone that shows me all the pictures I've taken on a certain day and you can go through and delete them, right? And I had one from E3 about 10 years ago which is um, all the people I think it was Xbox One year and it was like I was there to see the birth of the world's most powerful console and it was all the people that like put like Xbox

had selected and they were right at the front and they were screaming and doing all that. And yeah, you can be a bit, you know, it's just marketing. But there was something about being in that room and seeing, you know,
It is marketing and but I'm a business podcast, that's fine. The um, the um, the but it it it but it it's I just think cynicism isn't necessarily incorrect, right? You know, you can say oh Summer Game Fest started with a remake and ended with a remake, right? You know, you could say that God of War without Kratos, what's that all about? You could do, you know, Ocarina of Time, come on, it's out this year, why are you only showing us a glimpse? You can you can be cynical. And those those those criticisms, if they you call them criticisms, you know, they they could stand up, maybe. But at the same time they were quite exciting as well. And I I say cynicism and criticism, that's always going to come up top in social media, I think. And then I and I just you can I don't want to say manufacture, but you can sort of bring that positivity. You look at the numbers afterwards. You look at my social media feed and I thought everyone hated God of War. But look at the numbers afterwards

and it was phenomenal for that game. And I realized oh that's you know, nonsense. People loved it. So I do really miss the in-person thing and I just there were just a few moments but during the events that weren't in person where I thought that would have been, you know, what how would the Xbox fans have reacted? I mean you could see it if you were in the screening. But so the exclusivity announced
Did you go to the screening? Did you get your Xbox?
I I think only fans were getting the Xbox. They were very specific about that. But I I was not in the screening. I
I was not. I was playing Onimusha.
I was I had a Tomb Raider actually. Am I allowed to say I played that? I don't know what the I don't know the embargo is up.
Tomb Raider embargo is up.
I don't do previews so I played Tomb Raider and
[laughter]
I think it's I I I'm assuming that you're telling me the truth the embargo is up. I was I actually was a little disappointed in it. For me Tomb Raider is a platformer, right? It's a puzzle platformer and the platforming didn't feel quite right. You know, the
Yeah, I heard she fell she feels quite

floaty.
Yeah, possibly that's the I don't know if that's if that's the right word but it's maybe something like that. There's still nine months to release. I think that could be that could be tied up. The game itself looked good. The combat was great. The dinosaur bit was cool. Like I it was
It wasn't a slam dunk.
Yeah. Yeah. What was your What were your games of the show? I guess you were very looking at the indie side of things.
Yeah, I mean Blood Dungeon for me is incredible. I'm still thinking about that demo. Like I just booted up every so often and just play through it. So it's the new one from from Messhof who did Nidhogg.
Ah.
Uh and it's basically an auto shooter but with parkour platforming. And so you just basically are in this giant 2D map and you are trying to basically kite all the enemies around and escape. Um it rules. I really enjoyed it. But my I would guess my my triple A Are they double A? I don't even know anymore. But um Silent Hill: Townfall was very exciting to me. I really enjoyed that demo. One of the things I don't like

like I play a lot of survival horror and I really don't like it when a character tells me like it like it it pulls me out of the experience if they go, "Look look look, I should do this." You know, like like the voiced. Um and so one thing that I really love about Townfall is that not only is it, you know, basically set in a fictionalized Scottish town, but um he doesn't do that self-narration. He has like an occasional like thing will pop up, but that's to give you the next objective. They're those are his internal thoughts. So when the character Simon, I think his name is, talks, it's you know, it doesn't pull me out of the of the immersion. I want I want to be scared. I want to be scared.
Yeah.
Um Oh, yeah. I look but Oh, so I did Alien: Isolation.
I did that.
I felt so bad.
Had the embargo up for that? Can I say that?
Embargo's up.
Yeah, good.
Um I talked about all these on Kind of Funny last week. So if they're not up, then we're all screwed.
Oh, okay. Great.
But now, like Alien: Isolation, they recorded you playing.
Yeah. Yeah.
I was like

stoic.
I encountered a bug, unfortunately, in my
I I the same one. Was it the loading bug?
So, I had to see I was I was basically as alien. I died. Kicked rebooted. I died again and then I was kicked out and that was the end of my game.
Had the same one.
Yeah, I see.
So, I I watched I was literally right at the end of the encounter. So, I just watched someone else do it. But, um Yeah, for me horror is I love the signposting. And then I just I just I love the experience of just sort of going along for the ride or with the designer's hand.
I don't like horror films, but I love horror games. And I'm I've told you this before. I I I I think it's um I think it's cuz I'm in control in a horror game sort of right. Uh I think that helps. Um and I adore horror games. So, my favorite game reveal of the show was Veronica. And Resident Evil Veronica is my um Code Veronica is my favorite Resident Evil game from the old versions of it. I bought a Dreamcast for that

back in wow, 2001, I think. Um so, I'm I'm I'm a big I was excited to see that come back. I wasn't expecting it either. Um um I knew I was expecting the game at some point. I wasn't expecting it at Summer Game Fest. Um um So, that is I'm really excited about that. Um but, I realized as I'm as I was starting going through the games that won the award at the show. Um I realized that uh how I must come across as an old man. So, like Resident Evil Code Veronica, Veronica because it's remake. Then Ocarina of Time because it's the greatest game of all time. And then I went Star Wars Galactic Racer, which I can't talk about. I know that the embargo is going to come on that. But, um that is a game that I was even from the trailer alone like that for me. But, then I realized that's because I played Pod Racer back
in the '90s.
So, I'm just like games that I used to like. Um just there's nothing. You pick some new ones. Um but, I it was I was Play Days felt full.
Play Days was packed.
Yeah.
Like I there were games at Play Days that I didn't get a chance to slot in

just because everything was cuz I was trying to do as much as I could. Um but it was packed. It was a great show.
Yeah, Play Days was packed. We the Summer the Game Business Live was sold out.
Mhm.
You tell you what, you obviously had your show at the beginning. I don't know if this helped, but I spent the whole weekend going, "Oh, no."
Yes. [laughter]
Just dreading the edge on the Mondays. I didn't quite enjoy it as much as I should have done. But um that went really well. I just thought it was great event. And obviously I know that it you know the release dates kind of part of it and where was thing, but I thought it was really
September's
I know. So I think Town Falls out in that sort of kills kills that
out on the same day as Control Resident.
Yeah.
If only they had the same publisher who could have um seen that one coming.
[laughter]
Well, um Silent Hill has a specific audience. And you look at the sales of those games, they tend to be quite similar. So I think I think they've got that wrapped up. Um I also think it's not all about that September with there's lot of the games are quite different. I know that you could target that Silent Hill and Control are both story-driven games, but

it's not all about that first week um anymore. It they do have this big runway into Christmas and with GTA basically just demolishing November and December for video game releases, there's opportunities for these games to get second bite of the apple when they when they get into thing. We talked about it before, but yeah, it is a bit of a a bit of a crush and then obviously there's another one in February um the following year. But um I just think there's a lot of great games um according to and it was I think I came out of that feeling super positive about the industry. And I actually think that's the reason that's what we miss with E3 is that E3 wasn't just about getting the industry a game is excited about about what's coming up. It's about to get the industry excited, get the industry believing. And the industry has sort of stopped believing um I think over the last four or five years and that's why I think this event was important. Unfortunately, we came out the Summer Game Fest and straight into layoff news and and closing news and the big one obviously being Xbox. Um Um uh uh Ubisoft did some one, too. I'll

come back to that. But, the um uh Xbox obviously at this point in time, there's been no announcement around what's going on at Xbox. There's a lawful lot of talk, a lawful lot of gossiping. There's a lot of um studios texting people and trying to find things out. But, basically, um Asad Qizilbash, CEO of Xbox, has said that there's only there's only a 3% profit margin, or sorry, accountability margin, on um on this business, which is terrible. I think the quote from um Satya Nadella was was even more shocking. It was something like Google makes more money um um was it YouTube or something makes more money than than um uh um uh the Xbox does from video games. Um it is uh it is a uh Yeah, it is basically the warning is very, very simple. They're not making enough money. Um YouTube monetizes Xbox better than we do. That was the quote. Um So, um it is it is a very, very tough time. Um

and there's talk all talk to talk about a studio closing, Double Fine, Compulsion.
Ninja Theory.
Ninja Theory is uh which is a surprise thing. They had just announced a game.
Yes, and then there was the rumor that um they were allowed to announce so that hopefully it would garner interest from other
When I heard Ninja Theory, my immediate assumption was that oh, that maybe the announcement was to try and um uh it's basically an advert for, you know, but it's not unusual. If you go back to when Fable was ever announced or Fable was announced when it was announced was because they were looking to hire people. So, it's not unusual for these um trailers to have another meaning.
Beyond Good & Evil 2 stave off a unwanted [snorts] uh Vivendi takeover.
Well, that's
That's my tin foil hat theory.
But, they they they they it's not unusual for a trailer to be there for to be on just marketing means. Uh It's a really tough situation. Um and I kind of think that Asad Qizilbash is right here and and it's whenever that my job whenever an acquisition happens is to go why? Why what is the point of that

acquisition? What's the point you know why did Nintendo buy Dynamo Pictures? Why did Sony pick up Bungie? Why is Take-Two splashing so much money on Zynga? And the answers are usually quite obvious because you can just look at what their strategy is. Nintendo wants to expand its IP into areas beyond games. Sony is eager to build a live service business. Take-Two has long wanted a presence in mobile that's that's been a big thing for them. So all those oh I get it I make sense. And naturally my brain goes to is there parts of business that don't make sense. So if you look at something like um when Take-Two bought Zynga Zynga was just starting to push into console games. And you think that's going to stop and indeed it did stop right? Because they don't need it anymore. So there's always going to be some casualty in that but a lot of the time you go okay it makes sense. I don't always agree with the strategy by the way I might have an opinion on the strategy but that's just my opinion and we all have different opinions. What really matters is whether the acquisition fits with what the company's stated goals are. And in the case of the one I just mentioned they all sort of did. When I get concerned is when the acquisitions are a bit frenzied or reckless when you have to squint a

bit to see um if you know whether it how it fits. And there was a few of those of Xbox's spending spree. So um if you go
Wait are you talking about is this like the 2019
It's the 2018 to 2020 when the acquisition deal went through so all of that they were they those spending spree existed. There were three strategic reasons right? The first and the biggest one was about Game Pass. Third-party publishers were not putting their brand new games into Game Pass they didn't they didn't want to do that. So Xbox needed to do it itself therefore it needed more games. And then they also wanted to develop a stronger presence in mobile so they needed more games and then they also wanted to build a stronger presence in PC. They also want to do some stuff in streaming. All of that required games.
And Mixer God I forgot about that.
Oh yeah the I meant to cloud game streaming, but yes, there was there there was that as well.
you meant I thought you meant Mixer. But no, you're correct.
Yes, yes. That's a that's a that's a reference. Um I had opinions on this strategy and regular readers and listeners, viewers

of the show will be familiar with this. I believed Game Pass has a ceiling on it. Um I felt this didn't just come from me, it came from some of the other people I was talking to. I thought it would appeal to hardcore players, but most gamers actually only play one or two games a year. So, I couldn't work out why they would subscribe to a service with hundreds in it. Um I also questioned whether Xbox could seriously Can they really compete in mobile when Apple and Google are such a duopoly? You know, can they compete with Steam when they're so so dominant? But that's just my opinion. Phil Spencer believed in the plan and so did his bosses, so you know, fine. Um So, in Xbox anyway, embarked on this spending spree for those reasons. And many of the Some of the acquisitions made perfect sense. Like Playground Games was responsible for their best-selling game in Forza Horizon. Bring that in-house.
Easy.
Um it picked up Obsidian and Ninja Theory, which I thought I liked those acquisitions. They were two good studios that I think have the potential to be great ones with a bit of support and a bit of funding. I thought we could go um they could go somewhere. I wasn't so convinced with Double Fine and Compulsion. Um they're great they're

clear I'm not slagging off those studios. They're great studios. I just wasn't sure Xbox needed to own them
Mhm.
um when they could have just signed the games.
Yeah.
But just supported the games. Let them They could do that, you know, you've got some of the biggest things they worked on last year, like we'll take partnered with. They partnered with um Hollow Knight and they partnered with Claire Obscure, right? You don't have to buy these things. But anyway, the time buying things is all the rage, so yeah, whatever. But as the acquisitions went on, I found them harder to fully understand. Um so, I did a Phil Spencer interview at the time, but he did other interviews with other people and he said similar things. He kept saying that Xbox needed to reach new audiences and new markets. He wanted success in China. He talked about India. He talked about Brazil. He wanted to buy a Japanese studio, which by the way, he did eventually buy when he acquired Bethesda and then closed it.
Closed it.
He wanted to reach different people, right? So, you're thinking, "Okay, he's after different genres, different demographics." I did that interview I did an interview with him about that, and then 2 months later they bought Bethesda, which is a studio famous for RPGs and shooters, which are the two genres Xbox needed no

help with whatsoever.
Already had covered.
Um I didn't know what was the point in buying Obsidian and and in exile and building a new Fable team now that they own Elder Scrolls and Fallout. I I just Doom and Gears of War, are they speaking to most I know I know they're different games, but are they mostly speak to the same sort of player? Um Activision Blizzard King made a little bit more sense cuz King gave Xbox that much desired mobile presence, even though there was no fully formed mobile strategy at the time. And Blizzard gave Xbox a strong name in PC, even if it had waned a little bit over the years. But they were still primarily a Western-based maker of RPGs and shooters, um although admittedly particularly big RPGs and shooters. I I wasn't a fan of those acquisitions. So much of it was just supplanting what Xbox already owned as opposed to adding to it. Um Now, in the end, this is to to cap off the story. Those Game Pass never did reach that wider audience. I don't think there's any expectation it's going to either. And by making Xbox fight on multiple fronts by going for streaming and mobile

and PC, the division has become stretched and overly complex. And now Asha Sharma has come in and realized, "Okay, Xbox needs to focus in on something." And focus isn't what you do, it's what you don't do. Um I look that I've heard some of the opinions. I've seen some of the videos. There are many on whether she's making the right choices. Um some think Xbox should just become a full third-party publisher. I'm not convinced that will satisfy Microsoft. But I don't think Satya Nadella just wants a third-party publisher. Um I actually think focusing on the console, at least for now, makes sense given where their strengths are. And I think investing in their big AAA franchises makes sense given the abundance of excellent double A and indie games, the stuff that's out there. Um they can just partner with those. They don't have to own them. I look at Halo. If you remember 2007, Halo 3 was the biggest entertainment launch of all time. And well, of the of that time. Um but um Gears of War was like the biggest third-party
Mhm.
you know, third-person shooter of the time. Fable it had potential. It never

quite got there, but I always felt it had potential. Even if you look at games like Sea of Thieves and Grounded and Ori, I think there's growth there. And there's also transmedia potential at TV and movie opportunities there. Um I think Xbox should focus on those and rather than be distracted by Kiln and Pentiment, even though they're the great games.
Do you think people care about Gears and Halo though now?
No, but I think that's but that's I think that's
But that's that's not to be cruel-sounding, but I'm going to be cynical again, but you know, but it is that you can see them just rebooting because now all you want to capture a whole new generation, get it in from the ground floor. That's why we've got this sort of reimagining of Fable. We have Halo Combat Evolved. We've got a new Gears, which instead of finishing the game series that they ended on a cliffhanger, they're going back to E3.
Yeah.
To the very beginning, so they can just retell the same well, from a different angle. You can relive E3, but it's like for me, it it screams of everything that

it doesn't interest me
E E E
about about Xbox's portfolio. It's like I liked it when it was Summer of Arcade, uh you know, making bets on weird games. I loved the Kilns. I loved the Pentiment, like that kind of thing. But now it just feels like they've been languishing and and being wishy-washy with everything for so long. It's like, what is what is Xbox anymore?
I think what the industry what the industry is now, and I say the when people talk about Japan Studio and Sony is that I don't think it's a job. I don't think it I don't think the industry wants it to be the job of the big companies to make these games. I think it should be smaller [clears throat] companies and these big companies should support these smaller companies rather than hey we let's try and crack this oversaturated and complicated market, you know. Thing is in the double A and indie space, you can make 10 of those games and hope one of them is a hit. Whereas in triple A you can sort of gear around it. Um I don't think people care about Halo and Gears of War but I

think that's franchise mismanagement and um I and Asher in her notes suggested they hadn't been invested in properly. And so I I I don't know that. I'm not on the inside. You could I don't don't they tried to reboot Halo before. They tried to give it a new push before but I I you know they are still popular. They're not they're not they you know they've gone from the A tier to the B tier in terms of commercial performance but they're still selling. Um we've seen games come back. We've seen Tomb Raider come back. We've seen God of War come back. We've seen we've seen franchises come back and then become bigger than they were before. I think it's if they invest in it properly and the game's good quality and they bring in new things, I think that's definitely a possibility. Um but obviously if they're going to focus on that and and and they're not going to focus on the other things, it's going to mean what we're what we're talking about here. It'll mean cuts. It'll mean studio closures or spin-outs. I I think it's going to prove challenging in the current climate but you know there's some there and look there's going to be angry at this cuz this is an embarrassing failure for

Xbox. It is a failure some of us saw coming and I can't have I've got I've got a quote in front of me, right? Phil Spencer in 2022 he's talked to the Washington Post and he expressed a concern about tech companies pushing into games. And he said Nintendo is not going to do anything that damages gaming in the long run because that's the business they're in. Sony is the same and I trust them. Valve is the same way. His point was he's reminding us that Google and Amazon and Meta or Facebook time are not games companies. Microsoft is a games company. These other companies, they don't care about games. And if you look at the news coming out of Meta and Amazon and this past year this past year alone and Google a few years back, he had a point. Like, you know, they do come in, they spend loads of money, they buy loads of things, change their minds, and walk out of it. But actually, Mike, in this case, Microsoft has been just as reckless and almost as damaging to the industry. Um And Sharma, you know, and her leadership team will be able to say this isn't on them. They didn't start the fire, they just tossed the pin out. I I'm picturing the community meme of Troy walking in with the pizzas in the You know the one where he's holding the pizza. And that's

actually Sharma walking in. She's got the job at Xbox, walks through the door, and goes, "Ah." I don't So, it She's got a point. Like, this isn't I know she may not be a, you know, in this industry. She may not have the love for it that that Phil Spencer has yet had yet. Um but um um uh which probably means that she's more capable of making the slightly more brutal decisions. I do hope the studios and teams um find a way to stay together. And for those And And for those that do get to remain, I actually think I don't know if there's any reason why this isn't possible, but I hope for a more structured or focused organization. Um they will have their own ideas, but I would split Xbox developers into five areas. I'd split them into shooters, RPGs, family, other, and mobile. Uh that's what I would do.
Creative houses.
Creative houses, basically. Well, because
Yeah.
Call of Duty is having a hard time. It's lost half of its audience in the last year. Halo wants to relaunch itself. Well, they've got two Can these two help each other out? Uh Fable looks brilliant, but Playground Games has never launched an RPG before. You know who has? Todd Howard. Well, actually,

could we not Could we not bring a line those things? Up You You You talk EA has a similar structure. It's not just Ubisoft.
Yeah.
EA, you know, has an entertainment and sports division. They have They have the similar uh looks in the way they approach things. It's about the types of games. You know, Spyro and Crash and Minecraft and that other thing, you know. I would That's what I you do, but um uh there might be reasons why they can't. They might need to be keeping some of these companies independent. I'm not sure.
I mean, maybe depending on outsourcing, etc. But also, yeah, it just I will say cuz I did some of the Xbox buying clothes door stuff. It's weird that Toys for Bob spent, you know, like half their presentation talking about how they went independent from all of this.
Yeah. Yeah.
Well, cuz to be fair, they had nothing else to show other than the same trailer, which was about a minute and 10 seconds.
Well, I also feel bad that
that trailer. Yeah, I know. People people love Spyro. I love Spyro.
I actually kind of agree with I think it's fine to partner with the studio that could be independent to make these

games. It There's no There's no real risk to Microsoft risk to Microsoft if the game doesn't work out. But, you know, ultimately it There's They're not They're not have They're I think it I think it that make that works. Um There's a few I mean, I saw that somebody did a tweet and there's a few of these are quoting this what Seamus Blackley said, um the former Xbox leader who suggested that, um I think he said this to GamesBeat, "Asher Sharma is the a palliative care doctor who slides Xbox gently into the night." Um I actually don't
of heat for that.
Yeah, I know. But, I don't think this is the end of Xbox. In fact, I think this is actually the return that they keep going on about. It's just the part the return that we didn't want to happen. Um It isn't cuz the return isn't just about, "Hey, you got a new logo. You got all caps thing. You got a new price for Game Pass." It's also admitting they got it really wrong. Changing course and and playing the market they're in today and not the one they expect to come in the future. And unfortunately, it's going to come at a heavy price. Um
Yeah. I

Uh do we do we know when it's all going down? I assume the end of the month.
I heard it was going to be this week. There's lots of negotiations and conversations going on.
know, like you, I know a lot of people at studios and it is just
I've heard it from a few of them that say they think they're okay. And there's a few of them that are frantically trying to do something about it. Um, I'm surprised by you know, obviously I'm wary of putting this to recording this on a Wednesday and then on Thursday some of this might be redundant. I'm interestingly company like Ninja Theory, I know Hellblade 2 didn't do it. But I think there's an IP there. They've got that small motion capture studio thing as well. Like it's I think they've got that. Um, I think there's something about them. Compulsion I worry about, but obviously I don't know what's really going on inside. They double fine you'd think if anyone can raise a bit of money it's Tim Schafer. Um, but um, Arcane that's another one that's sort of been being thrown around a bit.
to me. I'm still not over Arcane Austin being closed down.
It is a turbulent time and ultimately

Xbox have this plan and then they and it didn't work out. Um, and they come up with a new plan and I actually compared to the old plan I like the new plan. It just I actually like Ubisoft's new plan as well. It's just the process of getting to it is is going to it's not going to be fun.
It's going to be awful.
Well, that's a happy note to leave on. Um, but um, there's lots of good games coming out. Um,
A lot of games coming out.
Yeah. Um,
Most of them in September.
[laughter]
Do you think Nintendo are going to put Zelda in November?
That would be very funny if they did.
Can you imagine?
I I mean, I would I would think that would be very funny if they did do it. I would love it.
Yeah. Yeah.
Cuz when when yeah, when's um, Fire Emblem? August, September?
September.
November, for God's sake.
[laughter]
All right, fine.
Yeah, I think I you know what? Nintendo, screw it. November 16th. Why not?
why not?
And then you GTA and whatever Devolver keeps posting about.
Yeah.
[laughter]
I saw that. Um,

yeah, I don't see Zelda's 40th anniversary. I guess we'll see a direct from them at some point. Um, uh, but um, but yes. Um, a lot more news obviously around Xbox, I'm sure. We will go a week at some point where Xbox isn't on this show. Um
I would Yeah, I mean I feel the same way on Friends Per Second when we're like, "Okay, we have to talk about Xbox again. We're sorry."
They are very good at talking and making noise and but they every week it's not just them saying stuff. There is There is something We had Matthew Ball on last week. Actually, Matthew Ball said something which I thought was um uh uh really interesting was just around the fact that, you know, we can't expect for the industry to back us on mobile and back us on PC where we've let the console wait. And I that's what I think that's right. I think going right We're going to focus on this. We're going to get our IPs back to full strength. We're going to get our console back to as strong as we can make it. Do that and then look to what's next. I think that's probably right.

Um but um uh They have to undo what was done before. Um Lucy,
Um
how can people find LookingForGame?
You can go to lookingfor.game uh and looking for game on all socials. Yeah, I was very proud of that URL.
Yeah, it's good.
Getting getting something other than a .com or a .co.uk or .au or whatever really opened up a lot of doors.
I'm all for on the nose names. It's one of my thing. Um
Yeah, I love it. It was also But it's also, you know, like LFG. I had a little fun with that.
Uh yeah. Oh, so similar reasons. So, The Game Business was named that initially because it was a very simple name until I realized that it's the TGB to the TGA. Yeah. So, um
I did I did try and think of TGC, but I The Game Curator? I don't
The Game Club? I mean yeah, and the um yeah, and
I think that already exists.
Yeah, I think that exists. I prefer The Game Business Show. I think that sounds um that sounds a little bit more flashy.

Yeah. Uh I've gone over. Lucy, thank you.
Yeah. Thank you.
Good luck with it. Um I suspect we'll start teaming you on things at some point.
Probably, yeah.
I think there's probably opportunity if you if you've got this wonderful group of independent developers that you speak to and I've got a bunch of investors, then maybe there's an opportunity there, but we can talk about that maybe some point in the future. But, um, yeah, thank you for joining us.
Thank you.
Before I leave things, it's worth going through some of the other big stories of the last week. Um, Ubisoft uh, is closing its Winnipeg and Belgrade studios, making cuts to its Barcelona team, and reducing its global publishing operation. Uh, we reported this on the Game Business website last week. In total, there are 380 jobs at risk. It's part of this ongoing mission from Ubisoft to reduce its costs by 500 million euros. They want to go from 1.75 billion euros in March 2023 to 1.25 billion euros by March 2028. That's their fixed costs. In January this year, Ubisoft closed its Stockholm and Halifax studios. A few weeks later, it announced

plans to cut 200 jobs from its Paris division, which caused strikes to happen. There were also cuts to Ubisoft Abu Dhabi, Red Lynx, and Massive Entertainment. In February, it cut 40 jobs at Far Cry 6 as its been sub-developer, Ubisoft Toronto. In March, it ceased making games at its Red Storm studio. Red Storm was famous for the Tom Clancy series. In 2025, it closed its Leamington Spa studio, plus had office closures and job reductions in San Francisco, Osaka, and Sydney. In fact, over 2025, Ubisoft reduced its headcount by 1,500 people. Uh, we've talked about this on the show before. There isn't too much to add. Ubisoft has been, broadly speaking, making uh, some cuts almost every month. I kind of understand the Ubisoft plan. I I I buy into it. I think it's an interesting one. What I would suggest for them would be to make these cuts faster, so the whole company can start gearing around a vision. I think the moment Ubisoft can tell its employees, "We're done with cuts for now. We're not We're not going to make any more cuts. Let's deliver the plan." I think the the sooner they can get to delivering on those I'm not convinced that it's a good environment to be making games when everyone's looking over their shoulders.

But, um, there'll be reasons for it, I'm sure. Um, But yeah, further cuts at Ubisoft going on there. Moving away from job cuts, this is a really interesting story. Electronic Arts is launching EA advertising, and that's a new platform that allows brands to market directly to consumers via sort of games. A few examples of this, and this mostly on the sports games, includes branded content in Madden. Red Bull is in EA Sports FC with branded in-game objectives and team kits. Xfinity and Peacock has some custom vanity kits and ultimate team packs also in EA Sports FC. Mountain Dew has its own playable team in EA Sports College Football 25 with custom stadiums, mascot, and rewards ecosystem. There's going to be ad units and digital billboards and scoreboards and and brand broadcast overlays. This is fascinating model. I know it's not going to be overly liked by a lot of people, but it's a way for video game companies to drive revenue or maybe even bring costs down for gamers, particularly in this current climate where things are particularly tough. I might try and explore this in the future. So, we had

Matthew Ball of course on last week who talked about this, and even though he wasn't talking on behalf of Microsoft, he felt this was a good potential avenue for the games industry to try and grow revenues without passing those costs directly onto consumers. This is a big story in the UK where I am with the UK government will ban social media for under 16s. The plan is due to go into effect in spring 2027, and the platforms affected would include X, TikTok, YouTube, Snapchat, Instagram, and Facebook. And it could encompass the likes of Twitch. The video games are seen as distinct from this, a decision that was welcomed by UK trade body UKIE. There's a similar social media ban in Australia. It is a complicated conversation, this. Online harms, social media harms is a real challenge, I think, for society. I struggle with it myself, and I'm in my 40s. So, let alone young people. I do feel it's a good thing that I wasn't online quite so much in my younger years, or at least when I was online, I was on forums, and nobody could hear see necessarily what I I writing, what I was saying. But also, upon saying that, banning is a bit of a blunt instrument. Are we not, you know,

not training up our youngsters and to how to deal with the online world? It's a complicated situation, um but um something did need to be done. Couple of the stories, Liz Prince, another UK story. She's the head of UK recruitment agency Amacus. Um she's been awarded an MBE in the King's Birthday Honors list for services to the games industry and diversity. I've worked with Liz for many years. She helped me on the Best Place to Work Awards when I was at GamesIndustry.biz. She runs the Gen to Gaming Diversity Initiative. She's a genuine good egg and a well-deserved honor. Another piece of good news, Focus Entertainment has signed Bradley the Badger. That's the new IP from Day for Night regular viewers, listeners, and readers of The Game Business will know that I interviewed uh Day for Night in a slightly calamitous interview at the end of December. And it's a really cool studio. They're formed by a bunch of people including a lot of the people who made Ubisoft's Mario and Rabbids games. The The title looks very funny. It's very Rare-inspired, a bit Banjo-Kazooie, a bit Conker's Bad Fur Day. Grant Kirkhope, the composer of Banjo-Kazooie, is actually on the game and on the project. I'm really excited about it and Focus I think has got a really cool

title there. Lastly, my last story, Treyarch studio head Mark Woodhouse is stepping down from his role after 22 years at the developer. He joined the Call of Duty studio for the GameCube and PS2 title Ultimate Spider-Man. Uh he played a senior role in Call of Duty 2, Big Red One on PS2 and Xbox. He became the co-studio head in 2016 alongside Jason Blundell and Dan Bunting. Um they left in 2020 and 2021 respectively. I don't know if this is related to the cuts or some of the changes that are going on at Xbox. His last game was Call of Duty Black Ops 7, which sort of uh didn't do as hoped, that game. Um although the previous one did did very well, but uh Mark Woodhouse is stepping down after a long tenure there at um Treyarch, so uh good luck and Godspeed to to Mark Gordon. That's it for the day's episode of The Game Business Show. Thank you to Lucy for joining us today. We'll be back on Monday with The Game Business Micro. That is only for paid subscribers. It's where we go through the news and give a bit of analysis. If you're not a paid subscriber, why not become one? Not only do you get our micro every Monday morning, you'll also get a monthly

market report and you get access to events like the Game Business Live. If you're interested in being a subscriber, paid or otherwise, just head to the gamebusiness.com, put in your email and you'll get an alert every time we do a new episode. But as I said, that's it for me today. Until next time, thank you for tuning in.