3 Reasons why Microsoft will KILL Xbox

Using Stephen Elop as the executioner


As you might have, or might not have heard, Microsoft is appointing Stephen Elop as the new head of the Devices & Studio division. So aside from overseeing the smartphone division, Elop will also be in charge of the Xbox and Surface hardware, as well as leading Microsofts game and entertainment studios.

Okay, let's take a step back for a moment. Stephen Elop, the man who was mentioned as a possible candidate to become the next Microsoft CEO (but lost out against Satya Nadella), the man who sold Nokia's bones to Microsoft, and the man who isn't that attached to the Xbox brand anyway, is now getting full hardware control.

Well, I guess the man deserves a fair chance to prove himself, but if you love the Xbox brand you might want to become a little bit scared. Just a lil' bit. And here's why.

1. Elop knows how to doll up an acquisition target

When Elop joined Nokia the phone company was already on its way down. So you could in a way praise Elop for keeping the company afloat for three years and making it a pretty target for acquisition. But I'm just being ironic there, because most people will remember Elop for letting Nokia revenues fall 40%, profits fall 95% and make the company's credit rating go from A to junk. And to top it off receive a bonus of 1 million euros when he was forced to close the door behind him.

This piece of history probably won't make Xbox owners happy, because a track record like that is hardly encouraging. Xbox and Nokia are however very different. So the chance that Elop will completely crush the Xbox platform is relatively small, but surely don't be surprised if he ditches a couple of Xbox parts that don't really work (Kinect?!), or hell, share or sell some parts to hungry buyers like Amazon or Facebook.


The Kinect, one of the most underused 'Killer Apps', is a big part of the Xbox One vision. Still, if it's only used for navigational purposes, and not for games, how viable is it? Especially if navigating via Kinect isn't that much more advantageous over navigating using regular controls.


But will Microsoft really sell off Xbox? No way. And that's not just because it only launched a new console a couple of months ago, but it's mainly because Microsofts Xbox Division is fishy as hell. It reported losses for thirteen years straight; the original Xbox never made any money. And how it somehow still managed to stay alive and is financially accounted for is a deep dark secret we'll probably never get to know. If you're going to sell, then you'll have to show the number. And showing numbers is something Microsoft doesn't want to do.

So while the bones of Xbox probably won't be sold to another party, there's a big chance Elop will keep slicing and dicing until Xbox has merged into Microsofts other businesses, effectively killing Xbox's current identity.

2. Elop isn't particularly fond of Xbox and loves focus

In november of last year Stephen Elop allegedly contemplated getting rid of Xbox. While there has been enough debate about these rumours being true or not, it is something investors and analysts have been wanting for some time. The call for focus on the enterprise and the cloud is quite strong. And Stephen Elop isn't scared of acting upon it.

Nokia made a bet on Windows Mobile

When Elop ruled Nokia he ditched Symbian, instead going for Windows Mobile. He argued that hopping on the Android train would make them late to the party, while Windows Mobile would help them "differentiate" from the rest. Cutting the phase-out period of Symbian short, Elop shows he is a man who loves to focus on one thing, and sure as hell isn't one to shy away from tough decisions.

Case in point: in 2011 Elop announced that 11,000 employees of Nokia needed to go for "restructuring purposes" and a year later he added another 10,000 to the leaving group. Of course, this was also accompanied by budget cuts and the elimination of several facilities. Ouch.

3. Consoles might not have a long life anyway

Big competitor Sony is actively moving into the cloud. The acquisition of game streaming company Gaikai is a prime example of this move. PlayStation Now, a service that's based on the Gaikai technology, is going to be available for all Sony devices and some non-Sony devices in the coming years. Which means that the hardware itself is getting less and less important.

While the tech behind it might not be ready for a while, it's not difficult to imagine a future where all the calculations are done externally (in the cloud) and consumers will just receive the output and deliver the input. This will make the need for a high tech console pretty much zero.

Microsoft CEO Satya Nadella

Microsoft has been doing some cloud development of itself and even has been integrating it in its new Xbox One machine. Developers can outsource some of the game calculations to Microsofts cloud servers, so the load won't have to be carried completely by the Xbox console. If that's not a glaring testimony to the validity of this future vision, then what is…

New Microsoft CEO Satya Nadella is still working on the renewed Microsoft strategy, but don't be surprised if he'll advise Stephen Elop to focus more on the cloud and less on the hardware. Which in turn sounds like music to Elop's ears.


Speculation, speculation, speculation. Unfortunately we can only guess what will really happen and for that reason this article presents as much guarantees as it presents free gifts. Zero. Unless you're seeing this article as a gift. But still, it's a remarkable move by Microsoft to appoint Elop, a move that deserves speculation, opinion and argumentation that might or might not be beautiful fiction in the end.


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