Microsoft could leave the gaming industry altogether

Microsoft is desperately trying to plug the holes that led to dozens of highly confidential documents becoming public. Tech gurus combed through every leaked document and came up with some pretty shocking findings.

Not only information about new hardware and games was revealed, but also the news that Xbox and Microsoft have abandoned investing in cloud gaming for the time being.

Even more shocking is Xbox boss Phil Spencer's suggestion that Microsoft will exit the gaming industry entirely if Game Pass subscribers don't reach 110 million by 2030. Microsoft rarely discloses subscriber numbers, but it's now clear that in January 2022, this was around 25 million.

The shocking statement was made during Microsoft's legal case against the US Federal Trade Commission (FTC), when the lawyer questioned Spencer about a slide showing Microsoft's long-term plans up to 2030.

Previously leaked documents have already revealed that Microsoft plans to release next-gen consoles in 2028, and the slide also shows the most optimistic prediction that Game Pass subscribers could grow to 110 million within two years of the next-gen console's release. Spencer was asked what would happen if they didn't reach that goal, and his response was:

"I can say with great confidence that if we hadn't made more progress with the console, we would have left the gaming industry. If the outcome had been like this, I believe we would no longer be in this industry."

“Most of our Game Pass users don't use our hardware. Hopefully, we could turn this image on its head before 2030. So when you asked me if I agree with this graph, I say that the light green and blue columns should gain share very quickly. I would say we should be in that position by fiscal 2026, 2027, or we should make a different business decision.”

In the chart, the dark green part represents classic Xbox console users, the light green part is PC gamers, and the light blue part is cloud users.

As the rest of the disclosed data showed, cloud games are currently almost irrelevant to most gamers, so a period of three years is a very short time to solve such a complex issue.

However, despite everything, many believe that Phil Spencer has exaggerated his claims and the possible consequences in the event of unmet goals. During the Activision Blizzard legal investigations, Microsoft presented itself as a company that barely matches and barely keeps up with the dominant Sony.

Whether there is any truth to what Spencer said, or whether he was simply telling the lawyers what was best for him, is hard to say.

The Xbox Series X/S consoles, which are still underselling the PlayStation 5 and Nintendo Switch, have definitely raised the question at least once of how long the Xbox should even stay in the gaming market if it can't possibly take the number one spot.