What the Xbox secrets leak tell us about the console business | The DeanBeat

22.09.2023 - 17:17 / venturebeat.com / Tom Warren / Phil Spencer

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Microsoft had a monumental leak of some of its most sensitive plans this week, as reported by The Verge’s Tom Warren. It was all thanks to someone at Microsoft who didn’t properly upload redacted documents to the Federal Trade Commission. I’ve been thinking about what this means.

And now last night, the United Kingdom’s antitrust regulators gave preliminary approval for Microsoft’s $68.7 billion acquisition of Activision Blizzard. Approval can come in a few weeks, after feedback.

Perhaps the biggest news leak was that Microsoft plans a hybrid Xbox game console for launch in 2028. The company also plans to launch a mid-life update (code-named Brooklyn) for the Xbox Series X/S console that launched in November 2020. These dates tell us a lot about the state of the console business and the progress of technology that is a key part of the decision making among the console leaders.

Microsoft didn’t dispute the accuracy of the documents, and Xbox head Phil Spencer said it was “disappointing” to read about the leaks to this staff, and he tweeted the company would say more when it is ready. Microsoft declined to say more.

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Console timing is critical when it comes to keep secrets from rivals such as Sony and Nintendo. As an example, Microsoft was late with the original Xbox and it debuted 21 months after Sony’s PlayStation 2. As a result, Sony vastly outsold the Xbox and had about 20 million consoles in the market by the time Microsoft sold its first million. And Microsoft lost billions of dollars on the original Xbox.

For the second generation of Xbox, Microsoft wanted to race ahead, and so it launched a new console four years after its first one and wanted to sell 10 million before Sony sold its first PlayStation 3. The gap was narrower in that generation, but Microsoft rushed its machine out and soured consumers with the “red rings of death” flaws that generated a $1.1 billion write off