Last year, Phil Spencer told the E3 crowd that Microsoft was focused on building its next generation of consoles, plural. Microsoft, Spencer told the crowd, was "deep into architecting the next Xbox consoles," plural. Now the company has changed its plans -- but doesn't necessarily want to admit that publicly.
In a recent interview with Business Insider, Spencer hedged, claiming that his statements were a reference to the disc-less Xbox One S and the now-somewhat-detailed enhancements intended for the still-unbranded Xbox Next. "Last year we said consoles, and we’ve shipped a console and we’ve now detailed another console. I think that’s plural," Spencer said. But according to other sources at the company, that's just a weak attempt to avoid acknowledging that the company's plans have changed.
Initially, Microsoft was going to build two devices(Opens in a new window) -- a high-end product (Anaconda) and a lower-end model (Lockhart). It was never entirely clear how these related to the "Project Scarlett" codename that had also leaked, though it was possible that Scarlett referred to the entire Xbox Next platform (software and hardware) while Anaconda was the codename for the console hardware alone. Regardless of how the codenames evolved, the plan is now to bring a single high-end console to market under the Project Scarlett codename.
Apparently, Microsoft changed its plans for multiple reasons. First, the company ran into trouble with developers, who were focusing on creating an experience that ran well on the lower-end Lockhart device before scaling them up for the higher-end Anaconda. This runs the risk of introducing quality differences that might not favor Microsoft in inevitable Xbox-versus-PS5 comparisons. This point was also heard(Opens in a new window) by Digital Foundry at E3, which lends it some credence.
The other shifting argument has to do with xCloud and the availability of game streaming. The intent of Lockhart was to open new markets to Xbox
(Opens in a new window) gamers that might be put off by the higher price commanded by Anaconda. But if this space can be met by xCloud and game streaming, then there's no point to Lockhart in the first place. Consumer buying habits and the decline of physical game media sales would undoubtedly have been closely examined here since the two markets don't necessarily overlap. In fact, one might think that the lower-end gamers that would be otherwise attracted to Lockhart would be poor fits for xCloud in the first place, as they're less likely to live in areas with high internet speeds and the necessary low latency connections. Whether this is true or not, it obviously wasn't a big enough issue to prevent the lower-end console's cancellation.
One of the interesting questions about the current console generation that I wish Sony and Microsoft would answer (they probably won't) is how well the Xbox One X and Sony PS4 Pro sold in the first place. Sony only releases combined sales figures for its consoles, while all estimates for Xbox One sales are, well, estimates -- Microsoft stopped releasing sales figures once it became clear that its console was going to command roughly half the market share of Sony's. Today, the Xbox One is estimated to have been outsold by over 2:1 by the PS4.
The irony here, of course, is that by embracing the concept of mid-generation upgrades, the console manufacturers weakened the idea of a "generation" at all. The PC game industry has never really adopted this framing, except by proxy. The reason is simple: We don't need it. If you have an Ivy Bridge CPU and an Nvidia RTX card, you have two completely different "generations" of hardware -- and it turns out, they get along just fine.
The only reason for Microsoft to phase out the current generation of Xbox systems at all, as opposed to keeping them in-market to provide an entry-level experience on next-generation games, ultimately comes down to simplifying things for developers and consumers who aren't used to dealing with this kind of issue in gaming. As for whether focusing on a single console model versus two is a good idea, we'd need to know the expected pricing. Microsoft and Sony aren't quite willing to talk about that yet.
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