The new policy initiated by Asha Sharma is radical, to say the least.
Last February, Phil Spencer’s resignation took almost everyone by surprise. It coincided with Sarah Bond’s departure and effectively led to a complete shake-up of the Xbox Game Studios leadership team. Logically, one might have thought that this signaled a shift in strategic direction after years of emphasizing “the catalog,” as Phil Spencer called it: the idea that the company needed to emphasize the variety and richness of a catalog filled with strong franchises, as well as more original and innovative titles. Asha Sharma’s arrival to replace Phil Spencer was bound to bring new directives, but we had no idea just how radical they would be.
Asha Sharma first emphasized the importance of the Xbox brand and its console before concluding that Xbox Game Pass was“too expensive” and needed to be “made more accessible.” This was done—and quickly. Two months after her appointment, the president decided to revise the prices, resulting in relatively significant reductions: Xbox Game Pass Ultimate dropped from 26.99 euros to 20.99 euros, a 22% reduction, while PC Game Pass fell from 14.99 euros to 12.99 euros, a 13% decrease. The latter thus became significantly more attractive than the mid-tier offering— Xbox Game Pass Premium —whose price (12.99 euros), which remained unchanged, was now on par with the lower-tier plan despite offering a smaller catalog.
What we didn’t know at the time was that this was only part of the new direction envisioned by Asha Sharma. A direction that is surprising many today following a rather successful Xbox Showcase featuring quite a few interesting announcements. According to Jason Schreier of Bloomberg, several Xbox Game Studios are on the chopping block. There’s talk of at least four teams, but others are reportedly in the crosshairs as well. Let’s be clear: Microsoft wants the Xbox brand to be more profitable, with higher margins. So, out go the studios that aren’t generating enough revenue. Although we’re not yet entirely sure of these teams’ futures, some are reportedly in negotiations to scale back operations or regain their independence.
Among the teams already mentioned is Compulsion Games (Contrast, South of Midnight). Based in Montreal, the team was acquired by Microsoft in 2018. Another casualty is Double Fine (Psychonauts), the studio led by Tim Schafer and acquired by Microsoft a year later. Even more surprising, there’s also talk of Ninja Theory. The studio behind the Hellblade series—far from being a commercial flop—had just announced the third installment in the franchise, Suena, during the Xbox Showcase! But that’s not all: rumors suggest a grim fate for Turn 10 Studios—which was forced to abandon Forza Motorsport to work on Forza Horizon 6—and the French studio Arkane Studios.
No doubt we’ll have a clearer picture in a few days, but there’s also no doubt that other studios could be affected—Microsoft seems to be only at the beginning of its major shakeup. The American publisher has decided to completely overhaul the strategy in place at Xbox Game Studios, and the appointment of Asha Sharma is intended to serve this new plan. A plan that, incidentally, has another “victim”: Craig Duncan, who has led Xbox Game Studios for just twenty months, has confirmed his departure, explaining that “when I agreed to lead [Xbox Game Studios] 20 months ago, my goal was to serve our studios, our teams, and the people who make our games.” While he also says he is “proud to have delivered many successful launches for our company,” one can assume that the current restructuring is not unrelated to his departure.
