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Exclusivity and XBOX — these two terms have been glued to one another like peanut butter and jelly. Since Asha Sharma took over as CEO of the now-rebranded XBOX, exclusives have become the number-one topic for the brand. In turn, when anything of the sort is voiced by her or anyone within the XBOX team, the gaming socials light up like a Christmas tree.
On a recent Bloomberg Tech stream, Asha got hit with the big question about XBOX exclusives and responded in kind:
“It’s a tough topic. Look, we’re the number two publisher in the world, and in order to be a great publisher, you must have your games reach large audiences to play. At the same time, we’re increasingly becoming a platform, and in order to become a platform, you must have exclusive content and services,” She said.
Continuing, “And so, we’re looking at that very closely. I think that we have to be very thoughtful about each title, on how we want to think about it, and learn from some similar cases in the industry, and that’s what we’re doing.”
I've seen people online calling this a nothing burger, while others are sprinting to the front lines like it's the second coming of exclusives. The truth, as with all things, is wrapped in corporate lingo; the answer is probably hiding somewhere in the middle.
Digging into her quote, you can see Asha is fighting a war on two fronts. On one side, she's got to keep feeding the insatiable money-making machine at XBOX, the one Amy Hood built to chase those elusive 30% margins. Something Asham specifically mentions she does not have to deal with.
“So my mandate is not 30% accountability margins.. It’s to be the number one gaming and entertainment company, and that’s what we’re going to go do.” Hallelujah!
Still, when you're the second-biggest publisher on the planet, you can't just make games; you’ve got to sell them, too. Making a juggernaut like Call of Duty exclusive would be like lighting a pile of cash on fire. We're talking about a franchise that sells 15 to 30 million copies a year. Cut that in half, and suddenly you're potentially staring at more studio closures.
When you spend that kind of money on development or on purchasing IP and studios, you need to see a return on that investment, and games the size of Call of Duty would strike a fatal blow to the brand. Unless XBOX was willing to stomach the loss of upwards of $2 billion a year.
Why exclusives still make sense
But let's not bury exclusives just yet. Last year, I called XBOX consoles nothing more than glorified Game Pass machines. Then Game Pass prices shot up into Halo rings, and honestly, XBOX felt lost to me. Thankfully, those pricing decisions have been reversed.
However, in Asha’s own words, “We’re increasingly becoming a platform, and in order to become a platform, you must have exclusive content and services.”
She specifically points to content and services, not only services. Meaning that Game Pass and other services aren’t the only things that should be exclusive to the platform; games should be as well.
Picture this: Fable, actually exclusive to XBOX. Suddenly, people have a real reason to pick up the green box, whether it's 'pro-consumer' or not. There's a reason Nintendo and Sony have armies of loyal fans; they have games you can't play anywhere else.
Now, I don't think Fable will become exclusive, since it's already been revealed as a PlayStation game, but that doesn't mean future titles can't revert to some form of exclusivity.
To sell hardware, which XBOX has struggled with recently, you need content as a reason to own said hardware. Do you think Apple TV, Paramount, or Netflix would do well if they all shared their shows with each other? Do you subscribe to more than one service to gain access to more content? Perhaps you subscribe to only one because you prefer the exclusive content on that platform to that of another.
Heck, there's a reason XBOX console sales rose 15% in the UK while PlayStation plummeted by 50%. Spoiler: it was Forza Horizon 6.
That's all while Forza Horizon 6 is planned to come to PlayStation 6. Even GaaS titles can increase sales, even if they're only timed exclusives.
Imagine if Netflix owned everything, and Disney Plus and Amazon Prime launched their content on Netflix as well as on their own services. Would you subscribe to Netflix or someone else?
Building a platform means offering something that other platforms don’t. Sure, that can come in the form of instant resume, XBOX Live, or something else, but if you want a console that can play God of War, Wolverine, Death Stranding 2 (at launch), Fable, and Forza Horizon 6, there’s only one console that can do that.
The problem for XBOX, at least for me, is we spent years waiting for their exclusive games to come to fruition. Every year was a “This is Xbox’s chance,” and when they finally had enough content in the works, they fumbled it and began launching it elsewhere.
As a result, we’ve seen year-over-year results of XBOX hardware declines, and an XBOX without a true gaming identity. When you think of a “Sony” or “Nintendo” game, you conjure an image of what that means within your mind.
What happens when you think of XBOX? Now, ask yourself: does that game remain an XBOX exclusive, or can I play it on PlayStation now or in the future?
I rest my case.
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