Hero to Net Zero – What is Phil Spencer’s legacy at Xbox?

A little over five years ago, on the eve of the Xbox Series X|S launch, Phil Spencer might have been heralded as the console brand’s saviour, but as he retires from the head of Microsoft’s gaming with almost immediate effect, the picture of his time is distinctly less rosy.

The Xbox brand was in complete disarray in 2014. After gaining a foothold with the original Xbox and then stealing the early lead with the Xbox 360 (and paying the price with the Red Ring of Death debacle), Xbox began to shift its focus under Don Mattrick’s leadership. The Xbox 360 lineup felt played out by the end of the generation – each year inevitably leaned on a Halo or Gears of War game alongside a Forza – and a lot of emphasis was being placed on Kinect, to challenge the Wii for family gaming. And when the Kinect was then bundled in with the Xbox One, making it both more expensive and less powerful than the PS4? And announced with so much emphasis being put on TV connectivity and with a tone-deaf message about always online DRM? It practically handed the upcoming generation to PlayStation.

Having already filled in after Mattrick’s sudden departure, Phil Spencer was promoted to lead all things Xbox in March 2014, and his immediate actions were decisive. Kinect was cut out of the Xbox One box, the price was cut by $100, and being able to point to being a keen gamer himself, and not just another Microsoft suit, helped to build a little confidence in the platform’s future once more.

Through the rest of the Xbox One generation, Phil Spencer’s appearances at E3 were a mixture of pondering what game dev-branded tee he would be wearing under his jacket, expected sequels and ports, and some truly transformational announcements. In 2015 it was backward compatibility for select Xbox 360 and (eventually) Xbox games, which helped to preserve ties to gaming history, when the only similar option on PS4 was for a full-blown port and remaster. 2016 saw Xbox games coming to Windows at the same time, first with Quantum Break and Forza Horizon 3, and eventually broadening to day-and-date launches on Steam. The Xbox One X in 2017 was Microsoft setting the story straight on hardware design, delivering the undisputed most-powerful console of the generation, shifting back to a more optimal architecture and paving the way for the future. But it was Xbox Game Pass and flurries of game studio acquisitions that started to herald the future of Microsoft’s gaming business.

Xbox Game Pass also launched in 2017, right at the point that it felt like a Netflix-like model would be relatively positive for the all the media we consume. The deal got even better a year later, as first party games would now come to Game Pass day and date, it came to PC in 2019, and then Project xCloud meant that you could play many of these games wherever you were, and take your progress between platforms. It sounded like a gaming utopia, even if it maybe wasn’t quite as smooth as you’d hope.

Having relied far too heavily on their tried and true franchises (and with some notable game cancellations and studio closures) the Xbox exclusives cupboard was feeling pretty bare. 2018 was the swing back in the other direction, Microsoft acquiring Compulsion Games, Ninja Theory, Obsidian, Playground Games, Undead Labs and inXile, and founding The Initiative. Some were long-time partners, other were still working on cross-platform games when they were acquired, and with a new generation on the horizon, it bode well for what was to come, even if a lot of PlayStation gamers felt put out by the prospect of their games now being exclusives… but let’s come back to that.

With the reveal of the Xbox Series X, a black obelisk of a design coming alongside the first embers of the broadened Xbox Game Studios promising stunning visuals in Hellblade: Senua’s Saga, not to mention the long-awaited Halo Infinite, all backed by backward compatibility and Xbox Game Pass as a still tempting price point, there was cause to believe that Xbox could truly compete with Sony once again. OK, so the name wasn’t particularly great, following on from the Xbox One X, but on paper it looked good.

But the console name wasn’t the last befuddling thing for the Xbox Series X. For one thing, there was eventually the Xbox Series S, which mystifyingly features less RAM than the Xbox One X, meaning it couldn’t match the outgoing hardware and would soon become the butt of every game performance comparison video. Then there was the chopping and changing of the Optimized for Series X logo, Smart Delivery as a concept, and the commitment to cross-gen games from Microsoft studios that went out the window soon. Cross-gen support was pretty opaque over on PlayStation too, but this could have been a win for Microsoft, and it was fumbled.

That’s far from the only thing that now feels like a fumble. With Halo Infinite’s much-hated reveal seeing it delayed, leaving just The Medium’s split-screen horror and Gears 5 Hivebusters DLC to really act as launch window exclusives, it layered significance to the acquisition of Bethesda. Xbox needed something big to tip the tables, and Bethesda had seemingly been keen for a buyer. Oh sure, they still had to deliver timed exclusive games Deathloop and Ghostwire: Tokyo to PlayStation, but Starfield as an Xbox exclusive felt fairly natural given previous closeness.

But that didn’t help fill Xbox’s release schedule or make for huge hits. Halo Infinite had a troubled launch, Forza Motorsport taking an age, Redfall was a straight-up flop, Starfield drew a collective shrug. The main highlights (outside of the ever-reliable Forza Horizon 5) were the shadow-dropped Hi-Fi Rush and the clutch of smaller projects that Obsidian was able to release.

Was it desperation that led Microsoft down the path to acquire Activision Blizzard? This eye-watering purchase is the real tipping point for Xbox. Since closing the deal in 2023, the Xbox Series X|S has rapidly increased in price faster than PlayStation 5, Xbox Game Pass has ballooned both in cost and the bundled subscriptions to justify this, and the rules on ‘day one’ games changed since Call of Duty’s addition to the service. All the amassed studios have also been affected, with several waves of layoffs across Microsoft leading to studio closures, game cancellations for the likes of Perfect Dark and Everwild, and more.

The whole reason for Xbox as a console manufacturer has also been called into question as Microsoft has now chosen to bring its games to PlayStation. It’s done so in the most consistently inconsistent fashion, as well. Some games are simultaneous launches, others are clearly defined timed exclusives, and others more nebulous.

But if you want to play all these games on day one? Well, you can always find them on Xbox. But what even is an Xbox anymore? The marketing over the last couple of years would want you to know that everything’s an Xbox. There’s your consoles, of course, but there’s also Windows PCs, that ROG Xbox Ally handheld now (which is a handheld PC more than an Xbox console), or just streaming to your TV or phone. So… you don’t need to buy an Xbox anymore. Is that the message? Given how dominant PlayStation 5 has been and the massively strong start for the Switch 2, that’s seemingly what the gaming populace has taken away from this all.

Unfortunately for Phil Spencer, he gets to shoulder the burden for the execs above and around him, so  the brand being continually diluted now feels like his lasting legacy for Xbox. He was once its saviour, convincing Microsoft CEO Satya Nadella to stay the course through the Xbox One era, but when six years of rebuilding didn’t lead to early success in the following generation, Spencer and Nadella signed the cheques to buy huge third-party publishers, shifting the expectations for what Xbox could deliver to Microsoft’s bottom line. It’s hard to say that Xbox is in a worse position now than when Spencer took over, when there’s more invested in it than ever and Microsoft’s studios have started to release great and varied games again, but the tone and what people expect from Xbox has changed. It now feels like less of a rival to PlayStation, and more like a publisher with consoles on the side.

Tags: Microsoft, Xbox, Xbox Studios