[0:00] - Why does Xbox exist?
[0:02] I mean, it seems like a simple question,
[0:04] but for the last year or so,
[0:05] there really haven't been
a lot of great answers
[0:07] as to why you should buy an Xbox.
[0:10] It seems like the people in charge
[0:11] don't have a better answer either.
[0:13] So, look, I'm gonna be honest,
[0:15] I want Xbox to at least be competitive.
[0:18] Do you wanna live in a world
[0:19] where PlayStation has zero competition?
[0:21] It's also a little personal for me,
[0:23] and you can kinda tell the
whole story of my channel
[0:25] through the last few generations of Xbox.
[0:27] Back in 2009, I traded my
entire gaming collection in
[0:30] to buy an Xbox 360.
[0:32] It almost immediately Red Ringed on me.
[0:34] I mean, my first E3 was the
launch of PS4 and Xbox One,
[0:38] one of the most infamous
days in Xbox history.
[0:41] And getting to reveal the Series X
[0:43] was one of the biggest
moments in my career.
[0:45] So yeah, I want Xbox to,
you know, continue to exist,
[0:50] which is why we've gotta
talk about the Xbox Reset.
[0:55] It was literally last
week at Xbox Showcase
[0:58] where I said that the easy part was done
[1:00] and the hard part was coming.
[1:01] I didn't expect the hard
part to show up this fast.
[1:04] Okay, so to be totally fair to Xbox,
[1:06] the last 100 days of Asha running the show
[1:09] have been genuinely good.
[1:11] They cut the price of Game Pass,
[1:13] they brought back real console exclusives,
[1:15] so there's Gears E-Day
[1:17] as well as Clockwork Revolution to start,
[1:19] and almost certainly more to come.
[1:21] They killed the stupid
everything is an Xbox campaign
[1:23] that basically nobody liked,
[1:25] and the showcase itself was solid.
[1:27] Gears, Halo, Fable, I
mean, Forza is already out
[1:30] and selling big numbers.
[1:32] Asha has walked in as the new CEO
[1:34] and really given Xbox fans
a reason to be excited
[1:36] in just her first three months on the job.
[1:38] But these were the easy wins.
[1:41] The real problems are,
[1:42] well, very real, and they just shared them
[1:45] in way more detail than they should.
[1:48] Last week, just a few days after Showcase,
[1:50] the Xbox team published a memo called,
[1:52] "Next 100 Days: XBOX Reset."
[1:55] And holy (quacks).
[1:58] The Xbox team have been doing the rounds
[2:00] with interviews the last couple of weeks,
[2:02] setting stage here,
really, with references
[2:04] to the business not being,
quote unquote, "Healthy."
[2:06] But this memo, which I wanna be clear,
[2:08] it wasn't leaked, they posted publicly,
[2:11] paints a terrible picture
[2:13] of where things really
are for Xbox right now.
[2:15] I'll be honest, it is actually
worth reading in full,
[2:17] but here are some of the takeaways.
[2:19] The cost of memory and storage,
[2:21] you know, the chips inside every console,
[2:23] has already doubled, and
they're preparing for it
[2:26] to hit more than five
times more than the cost
[2:29] before the RAM crisis
by holiday of next year.
[2:32] Now, they think that they
actually got hit harder
[2:34] than anyone else in the industry,
[2:35] because of, quote unquote,
[2:36] "Choices they've made
over the last five years,"
[2:39] which I feel like is a loaded phrase
[2:41] that I bet there's a whole backstory too.
[2:43] But they're in a mess.
[2:45] A huge part of my job is
coming up with video ideas.
[2:48] And here's the thing, y'all
give me tons in the comments.
[2:51] So when Zapier reached
out to sponsor this video,
[2:53] it was the perfect time to build something
[2:55] I've wanted forever, an easy
way to consolidate ideas
[2:58] and feedback from the comments
[2:59] into something I can actually use.
[3:01] Zapier's pitch is simple,
[3:03] their job is to connect apps
and run workflows between them.
[3:06] Zapier has an MCP server,
which is a fancy way of saying
[3:09] that you can plug it directly into tools,
[3:11] such as Claude or ChatGPT.
[3:12] Now, I had to authorize it
in my Claude settings myself.
[3:15] It's not always on,
[3:16] it's only something that
I enable when I want it.
[3:19] So now, Claude can pull
from my YouTube comments
[3:21] and drop the organized
ideas directly into Notion.
[3:24] In just a few minutes of setup,
[3:25] I had my first batch of ideas,
[3:27] including one on smartphone features
[3:28] that were killed too soon.
[3:30] Manually, I probably
wouldn't have noticed,
[3:32] but these are ideas from you,
[3:33] Zapier just helps to surface
them and so much more.
[3:36] There are so many things
you can do with Zapier,
[3:39] so if you wanna check it out,
[3:39] I'll have a link in the description.
[3:41] And again, big thank you to Zapier
[3:42] for sponsoring this video.
[3:45] The crazier part is the
actual business side.
[3:47] Over the last five years,
[3:48] essentially, the Xbox Series X generation,
[3:50] Microsoft has poured something
like $20 billion into Xbox,
[3:55] only for revenue to go down.
[3:57] For context, because
I think at this point,
[3:59] we're all desensitized to
billion this, trillion this,
[4:02] over the entirety of PlayStation,
[4:04] Sony profited about $20 billion.
[4:07] Now, I'm not saying the PS5,
[4:09] which is the most profitable generation,
[4:11] no, $20 billion from PlayStation
since the PS1 launched
[4:14] over 30 years ago.
[4:16] Seriously, just sit
with that for a second.
[4:19] (lips trilling)
[4:20] You can say a lot about Microsoft,
[4:22] but you cannot fault them
[4:23] for not investing huge
piles of cash into Xbox.
[4:27] The idea of putting $20 billion in,
[4:30] and during that time, seeing
your revenue drop not rise,
[4:33] is honestly kind of unbelievable.
[4:35] I maybe wouldn't have shared those numbers
[4:40] if I was running the show,
[4:41] but hey, appreciate the transparency
[4:44] by really letting everyone know
[4:45] just how deep a hole they're really in.
[4:47] This by the way completely sidesteps
[4:49] the almost $70 billion they invested
[4:52] in buying Activision Blizzard,
[4:53] a deal I think in hindsight
they probably overpaid for.
[4:57] As of right now, the entire Xbox division
[5:00] is running at a, quote unquote,
"3% accountability margin,"
[5:04] which, again, is trending down and not up.
[5:06] To top it off, you've got Satya Nadella,
[5:08] the CEO of all of Microsoft, saying this.
[5:11] - Like there's more monetization
of Xbox games happening
[5:15] on YouTube than at Microsoft.
[5:18] - Holy (quacks).
[5:20] I mean, I do think he's kinda joking here,
[5:23] but clearly, things are
not working right now.
[5:26] Now, again, I wanna be really
clear what this video's about,
[5:28] I want Xbox to succeed.
[5:30] But reading these numbers
gives me heartburn.
[5:33] I mean, even for a huge
company like Microsoft,
[5:36] this is not sustainable.
[5:37] I think that that's why
they've shared so much,
[5:40] they've got to make some
big changes right now,
[5:43] and this memo is kind of
the justification for it.
[5:45] So that's the situation,
[5:47] which brings us right
back to the one question
[5:49] that even Xbox admits
they can't answer today,
[5:52] "Why should anyone buy an Xbox?"
[5:55] I mean, historically this
was a pretty simple question.
[5:58] You bought an Xbox, or a
PlayStation for that matter,
[6:00] to play the big exclusives,
[6:02] and because that's where
your friends played.
[6:03] But at this point, neither
of these are really true.
[6:06] Games like Halo and
Forza are not only on PC,
[6:10] but they're also on PS5.
[6:11] And cross play has largely
become the standard now,
[6:14] which means it's a real edge case
[6:15] to not be able to play with your friends,
[6:17] regardless of the platform.
[6:18] The days of picking a console,
[6:20] because that's where all your friends are,
[6:21] that's just not a thing anymore.
[6:23] Opening things up did work to sell games,
[6:25] but it gutted almost every
reason to buy an Xbox console,
[6:29] outside of Game Pass?
[6:32] I mean, the obvious
answer this generation
[6:34] has just been to buy a PS5,
which plays everything.
[6:37] And guess what?
[6:38] Everyone's bought a PS5.
[6:39] The sales have not even
been close with the Xbox.
[6:42] Now, they have started to
roll back console exclusives,
[6:45] but this is gonna be a slow process.
[6:46] I mean, they've already committed
most of their big titles,
[6:49] like Halo: Campaign
Evolved, to land on PS5.
[6:52] Just snapping your fingers
[6:54] and pulling everything back to Xbox
[6:56] would just lose sales at this point
[6:57] and really, really piss off Sony.
[6:59] And that's the tough balance.
[7:01] Do you value selling games,
[7:03] you know, the thing that
actually makes money,
[7:05] or do you give up on at least some of that
[7:07] in favor of building the reasons
[7:08] for people to buy an
Xbox over a PlayStation?
[7:11] I mean, I think they're
gonna make this decision
[7:13] on a case by case basis.
[7:14] I mean, it would be crazy
[7:15] to take something like
Forza off the PlayStation
[7:18] and games like Call of Duty
[7:19] have already been committed
to stay multi-platform
[7:21] for basically ever.
[7:22] But there will be at least some big games
[7:24] that only land on Xbox
and PC going forward,
[7:27] it's just gonna take a while
[7:28] to actually make an impact for them.
[7:30] Exclusives are one part of the
story, but value is another.
[7:33] The current generation has been rough,
[7:35] but the silver lining has
largely been the Xbox Series S.
[7:38] At $300, at least up until recently,
[7:41] it has been the cheapest
ticket into modern gaming.
[7:44] And I know a lot of people
[7:45] who have picked one up,
signed up for Game Pass,
[7:47] and are still really happy.
[7:48] Except they hiked Xbox
prices twice last year
[7:51] and are reportedly still losing
[7:53] as much as hundreds of
dollars per console right now.
[7:57] With the RAM crisis,
[7:58] even $650 for a Series X
just isn't sustainable.
[8:02] This whole thing is still
getting a lot worse.
[8:04] So exclusives are part of the story,
[8:07] price, unfortunately, probably isn't.
[8:09] Even Microsoft with their deep pockets
[8:11] can't afford to lose big cash
on every console forever.
[8:14] Maybe the answer is building
a badass next gen console?
[8:18] I mean, sure, a super powerful
Project Helix would be great,
[8:21] but once you get above like 1,000 bucks,
[8:23] which it almost certainly would be,
[8:25] it is always going to be a
more limited kind of device.
[8:28] And what I'm hearing
[8:29] is that they're considering
how to scale it back
[8:31] and cut costs regardless.
[8:32] Who knows what Helix actually
looks like at launch.
[8:35] Finding a real reason for
why you should buy an Xbox
[8:37] is just a tough sell right now.
[8:39] You can't even really blame Sony here.
[8:41] I mean, look at the problems.
[8:43] Microsoft chose to bring Halo
and Forza to PlayStation.
[8:46] Even the RAM crisis kinda comes
back to Microsoft in a way.
[8:49] They're spending $190
billion on CapEx in 2026,
[8:53] most of which is going
to their AI build out,
[8:56] you know, the thing that's
causing the RAM crisis
[8:58] to begin with.
[8:59] Look, there's no way around
it, things are bad for Xbox.
[9:02] There's a real reason for
some real drastic changes,
[9:05] spinning Xbox off into its
own standalone company,
[9:08] cutting studios, or even
just calling it a day
[9:11] on console hardware entirely.
[9:12] But I do think there are things
[9:14] that Asha and the team can
do for the next 100 days
[9:17] that can make a difference.
[9:19] First of all is the biggest
one, get Windows right.
[9:23] The biggest strength of a console
[9:24] is the simplicity and
the it just works factor.
[9:28] Having the flexibility
of Windows is great,
[9:30] and while Xbox Mode is an
improvement, it is not there yet.
[9:34] Now, they've still got time,
[9:35] but this has to be priority
number one, it is the foundation
[9:38] for the entire next
generation Xbox platform.
[9:41] But you've gotta make it
easy and clear to understand
[9:44] what's an Xbox versus a PC.
[9:46] The details matter here.
[9:48] Make the true Xbox version
of Windows its own thing
[9:51] with a guaranteed set of features,
[9:53] like full Xbox backwards compatibility
[9:55] and clear performance tiers.
[9:57] Then, ship Helix.
[9:59] Now, my understanding
[10:00] is that it's largely built
and paid for at this point,
[10:02] at least on the development side.
[10:03] But, look, you don't have to rush it,
[10:06] no one is clamoring
for brand new hardware,
[10:09] at least not yet.
[10:10] Take the time to lower
the costs, scale it back,
[10:13] whatever you gotta do.
[10:14] But I do think putting
[10:15] a real next gen Xbox on shelves matters.
[10:18] Hopefully, they can do this
[10:19] along with a true affordable
Series S successor,
[10:22] and probably, by opening up the Xbox brand
[10:24] to more third-party
hardware like the Xbox Ally.
[10:27] And then, lean all the way
in on games and exclusives.
[10:31] Sure, I mean, keep things
going on a case by case basis
[10:33] on what games are true exclusives,
[10:35] maybe which ones are timed,
[10:36] and which ones just go
straight to the PS5,
[10:38] but now is not the time to gamble
[10:40] on new and unproven concepts.
[10:43] Get Elder Scrolls VI out the door,
[10:45] give us an actually new Halo game,
[10:47] remake Fallout 3 or New Vegas.
[10:49] How about StarCraft 3?
[10:51] Look, I don't care which
of these you actually do,
[10:53] but just green light and fast track some
[10:55] of these obvious slam dunk games
[10:57] to not only bring some
much needed revenue in,
[10:59] but also to have some real next gen titles
[11:02] to sell Project Helix and Game Pass.
[11:04] And finally, the hard one,
sort out the business side.
[11:07] Game Pass is still the
best answer Xbox has,
[11:10] so just fully commit.
[11:12] You can't ship a next gen
console at the price you want?
[11:14] Bring back Xbox All Access
[11:17] and bundle the hardware with Game Pass
[11:19] in a reasonable monthly price.
[11:21] While you're at it, give
away the easy stuff,
[11:23] make Xbox Live Multiplayer actually free.
[11:26] If you're shipping a PC, you
kinda need to do this anyway,
[11:29] since no one pays for online on PC
[11:32] outside of specific titles
like WoW or EVE Online.
[11:34] Announce the free
multiplayer at the right time
[11:37] when you tweak the Xbox Game Pass tiers,
[11:39] and eventually, release that
free ad-supported version
[11:41] that's been teased forever.
[11:43] (Austin sighing)
[11:44] Okay, I'll admit, this is a lot,
[11:47] and the Xbox team certainly
has a better picture
[11:49] of what to do than I do.
[11:50] But look, this is a rare opportunity,
[11:53] not everyone gets the
chance at a real reset.
[11:56] This can be an opportunity
to ensure that Xbox can build
[11:59] to become a truly healthy business again.
[12:02] They have all the pieces,
[12:04] maybe they're a little broken
and scattered right now,
[12:06] but, look, I know this
is a very difficult task,
[12:09] but I do think it's fixable.
[12:11] I also think the next 100 days
are going to be a wild ride,
[12:14] but I'm gonna be here for it.
[12:16] If you too wanna be here for it,
[12:17] make sure to subscribe to the channel
[12:18] and ring-a-ling that ding-a-ling button.
[12:20] And definitely stay tuned,
[12:21] it is about to get real, real spicy,
[12:24] for good and for not so good.
[12:27] (suspenseful music)