Microsoft MSFT +0.74% is set to announce what could be its largest round of layoffs in company history, and some of the job losses may hit Xbox.
According to a report in Bloomberg, the tech giant is attempting to reduce redundancies from the $7 billion acquisition of Nokia , which added 30,000 jobs to the company. But other departments may be affected as well.
Specifically, the report mentions the marketing team for the global Xbox division.
Cutting jobs doesn’t mean Microsoft is walking back its support for Xbox, but it does underscore the company’s new direction under new CEO Satya Nadella.
Microsoft CEO Satya Nadella, Credit: AP Photo/Eric Risberg, File
Despite saying recently that Microsoft is committed to the Xbox brand, Nadella said in an interview with Fortune that the video game system remains outside the ‘core’ of Microsoft’s business.
“Xbox isn’t that far from [the core],” he told the publication. “We can do a few more things than the core. But the point is, you’ve got to have a culture to do it.
“I want us to be comfortable to be proud of Xbox, to give it the air cover of Microsoft, but at the same time not confuse it with our core.”
This echoes an earlier email from Nadella to employees in which he wrote:
“As a large company, I think it’s critical to define the core, but it’s important to make smart choices on other businesses in which we can have fundamental impact and success. The single biggest digital life category, measured in both time and money spent, in a mobile-first world is gaming.
“We are fortunate to have Xbox in our family to go after this opportunity with unique and bold innovation. Microsoft will continue to vigorously innovate and delight gamers with Xbox. Xbox is one of the most-revered consumer brands, with a growing online community and service, and a raving fan base. We also benefit from many technologies flowing from our gaming efforts into our productivity efforts – core graphics and NUI in Windows, speech recognition in Skype, camera technology in Kinect for Windows, Azure cloud enhancements for GPU simulation and many more.
“Bottom line, we will continue to innovate and grow our fan base with Xbox while also creating additive business value for Microsoft.”
Nadella obviously recognizes the value of the Xbox division and the innovation that stems from it, even if he is careful to point out that Xbox is not one of the company’s core businesses.
That’s a good sign for Xbox in the short-term at least, but I do wonder if an emphasis on the gaming division not being part of the “core” is bad news for Xbox in the long-term.
Nadella appears to be taking a much more calculated approach than his predecessor, Steve Ballmer, in how Microsoft is defined and what its mission needs to be. Essentially, the new CEO is dialing back Ballmer’s attempt to transform Microsoft into a “devices and services” company and focusing on productivity across mobile and the cloud:
“More recently, we have described ourselves as a “devices and services” company. While the devices and services description was helpful in starting our transformation, we now need to hone in on our unique strategy.
At our core, Microsoft is the productivity and platform company for the mobile-first and cloud-first world. We will reinvent productivity to empower every person and every organization on the planet to do more and achieve more.”
A Nokia acquisition quite likely would not have happened with Nadella at the helm, and his focus on productivity and the cloud leaves Xbox as something of an outsider. Thankfully it’s still a very popular, recognizable outsider.
I don’t expect a spin-off of the Xbox division or any other major changes in the near future, but there’s no denying that in Nadella’s vision of Microsoft, Xbox plays a very secondary role—and a role that will likely change over time.
Then again, it’s also possible that the video game console as we know it is in its last generation. If services like PlayStation Now—Sony's game-streaming service—are a success, the Xbox and PlayStation of the future may not be hardware based at all.
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Xbox Not A 'Core' Part Of Microsoft's Business CEO Says
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A bit misleading - it just means it's not the main course of the Microsoft Family meal deal.
Didn't really read anything to suggest they're puling back or anything.“I want us to be comfortable to be proud of Xbox, to give it the air cover of Microsoft, but at the same time not confuse it with our core.”
1 Week Ago #3
Sorry, but I can't see PlayStation and Xbox not continue to be hardware based. Consumers want options. It's like motion-controlled gaming or VR -- just because it's new and exciting doesn't mean it's going to replace what we're familiar with.
1 Week Ago #4I have twitter to https://twitter.com/GamerYuichi , Also started youtube https://www.youtube.com/channel/UCMu7yRGCz8QrTyxaNVR3Tqw I don't always twitch, but when I can you can find my noobness http://www.twitch.tv/yuichimccry,
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blahhh...click bait article title really...the Xbox brand isnt going anywherePSN: Metfanant
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