'It's Funny That People Think About the Console-PC as Two Different Things' — Microsoft CEO Satya Nadella Drops Biggest Hint Yet That the Next Xbox Is Basically a PC

Microsoft CEO Satya Nadella has dropped yet different hint that the next-gen Xbox is fundamentally a PC.

A caller study this week claimed the adjacent Xbox is simply a console / PC hybrid that volition play PlayStation games released connected PC via Steam. That means the likes of Sony Santa Monica’s God of War, Insomniac’s Spider-Man, and Sucker Punch’s Ghost of Tsushima and beauteous overmuch each different PC games volition each beryllium playable connected the next-gen Xbox successful an manufacture first.

Windows Central reported that portion users of the next-gen Xbox tin stay wrong the Xbox ecosystem if they want, they tin exit to Windows, wherever the console acts similar a accepted Windows PC. That means having entree to PlayStation games connected Steam, and rodent and keyboard games from Blizzard's launcher, Battle.net (World of Warcraft), and Riot's launcher (League of Legends).

Microsoft brag Satya Nadella drops beardown hint astir the next-gen Xbox. Photo by Stephen Brashear/Getty Images.

Now, successful an interrogation with TBPN, Microsoft brag Satya Nadella responded to questions astir the improvement of the company’s gaming business, and successful doing truthful dropped a wide hint astatine wherever the institution is going.

(Nadella was not asked astir the caller Trump Master Chief AI representation oregon the Department of Homeland Security's ICE-promoting Halo representation successful the interview.)

“Remember, the biggest gaming concern is the Windows business,” Nadella began. “To us, gaming connected Windows… and of course, Steam has built a monolithic marketplace connected apical of it, and they’ve done a precise palmy job. Now, we’re the largest steadfast aft the Activision [deal]. Therefore we privation to beryllium a fantastic publisher. Similar attack to what we did with Office. We privation to beryllium everywhere, successful each platform. So we privation to marque sure, whether it’s consoles, whether it’s the PC, whether it’s mobile, whether it’s unreality gaming, oregon the TV, we conscionable privation to marque definite the games are being enjoyed by gamers everywhere.

“Second, we besides wanted to bash innovative enactment successful the strategy broadside connected the console and connected the PC. It’s benignant of comic that radical deliberation astir the console-PC arsenic 2 antithetic things. We built the console due to the fact that we wanted to physique a amended PC which could past execute for gaming. I benignant of privation to revisit immoderate of that accepted wisdom.

“But astatine the extremity of the day, console has an acquisition that is unparalleled. It delivers show that is unparalleled, that pushes I deliberation the strategy forward. So I’m truly looking guardant to the adjacent console, the adjacent PC gaming.”

Nadella’s comments present shouldn’t truly travel arsenic overmuch of a surprise, fixed they reenforce erstwhile reports and comments from Xbox executives. For example, Xbox president Sarah Bond has called retired the precocious released — and pricy — ASUS ROG Xbox Ally X handhelds arsenic pointing successful the absorption Microsoft is taking with its upcoming console. In an interrogation with Mashable, Bond talked successful vague presumption astir what Microsoft is going for, but did powerfully suggest it volition beryllium an costly device.

"The next-gen console is going to beryllium a precise premium, precise high-end curated experience," Bond said. "You're starting to spot immoderate of the reasoning we person successful this handheld [ROG Xbox Ally], but I don't privation to springiness it each away."

The institution has confirmed — arsenic precocious arsenic earlier this period — that it inactive plans to travel the Xbox Series X and S with a next-gen console, and has announced an statement with AMD to marque it happen.

Microsoft has promised “next-level performance, cutting-edge graphics, breakthrough gameplay, and unmatched compatibility,” and said everything it’s moving connected volition beryllium “fully compatible” with users’ existing Xbox crippled library.

Prior comments from Bond person backed the console / PC hybrid proposition up, too. "This is each astir gathering you a gaming level that's ever with you, truthful you tin play the games you privation crossed devices anyplace you want, delivering you an Xbox acquisition not locked to a azygous store oregon tied to 1 device," Bond said.

"That's wherefore we're moving intimately with the Windows team, to guarantee that Windows is the fig 1 level for gaming."

Nadella aboriginal went connected to interaction connected Microsoft’s gaming concern model, saying the champion mode to innovate is to person bully margins, due to the fact that that means the institution tin money that innovation.

“But astir importantly, the crippled concern exemplary has to be… wherever we person to invent possibly immoderate caller interactive media arsenic well,” Nadella said. “After all, gaming’s contention is not different gaming. Gaming’s contention is abbreviated signifier video. And truthful if we arsenic an manufacture don’t proceed to innovate — some however we produce, what we produce, however we deliberation astir organisation — the economical model, the champion mode to innovate is to person bully margins, due to the fact that that’s the mode you tin fund.”

The notation of margins follows a caller study that alleged that Microsoft had pushed Xbox studios to present a 30% nett borderline — overmuch higher than the manufacture average.

Bloomberg’s Jason Schreier reported that Microsoft’s 30% nett borderline extremity had led to the gaming division’s immense layoffs, canceled projects, arguable terms rises, and multiplatform push.

The cuts to Xbox person been deep. Thousands of unit person mislaid their jobs implicit respective rounds of layoffs. Games specified arsenic Rare’s Everwild and The Initiative’s Perfect Dark reboot were canceled aft years of development. ZeniMax Online Studios crippled Project Blackbird was canned, starring to wide layoffs. The Initiative was besides unopen down. Last year, Microsoft closed Redfall developer Arkane Austin and Hi-Fi unreserved developer Tango Gameworks.

Meanwhile, Microsoft has accrued the terms of the Xbox Series X and S consoles, and the terms of Xbox Game Pass Ultimate to $29.99 a period — the second of which was a hugely arguable move. Microsoft tried to marque the leap to $80 video games, but ended up reverting to $70 aft fans pushed backmost connected the thought of paying $10 much for Obsidian’s The Outer Worlds 2. Most expect Microsoft to spell to $80 astatine immoderate constituent adjacent year.

Bloomberg said the mean nett borderline successful the video crippled manufacture is 17-22%. Over the past six years, Xbox has deed 10-20%. To enactment that 30% people into much context, Sony's PlayStation part achieved a 16% nett borderline successful Q1 FY25. Bloomberg said Microsoft Chief Financial Officer Amy Hood enforced the caller people successful autumn 2023 — amid Microsoft’s $69 cardinal acquisition of Call of Duty shaper Activision Blizzard.

The upshot present is, according to Bloomberg, that games that are inexpensive to marque oregon considered much apt to marque tons of wealth whitethorn instrumentality precedence implicit riskier projects. Xbox’s “floundering” hardware division, meanwhile, whitethorn look “a important rethinking.”

Xbox is acceptable to spell up against PlayStation erstwhile again, with some Microsoft and Sony reportedly acceptable to merchandise their next-gen consoles successful 2027. The next-gen Xbox is taking a antithetic way this time, but the anticipation is the PS6 volition beryllium a much accepted console, offering genuinely exclusive games — arsenic the PS5 does now.

Speaking of exclusives, Microsoft has good and genuinely walked distant from the full conception aft announcing Halo: Campaign Evolved for PS5 successful 2026. Bond had said the thought of a video crippled exclusive locked to a azygous storefront has go “antiquated for astir people,” truthful Halo’s leap to what was erstwhile considered its bitter rival didn't travel arsenic overmuch of a surprise, either.

Photo by Stephen Brashear/Getty Images.

Wesley is Director, News astatine IGN. Find him connected Twitter astatine @wyp100. You tin scope Wesley astatine [email protected] oregon confidentially astatine [email protected].