Game studios question value of Xbox amid multiplatform pivot

The Xbox platform is facing mounting criticism from developers, former industry leaders, and insiders, who cite mounting concerns about Microsoft’s current strategy, communication practices, and the long-term sustainability of Game Pass.

Scott Junior, chief product officer for Dune: Awakening, explained that the Xbox Series S has been a persistent challenge when optimising games across platforms.

“So, it’s one of the reasons we’re coming out on PC first,” he said.

“There’s a lot of optimisations we need to do before we release on the Xbox. But yeah, Xbox Series S is a challenge.”

He acknowledged that the team would ultimately manage to get the game running on lower-spec hardware, though his remarks are far from isolated within the industry.

The developer of Enotria: The Last Song announced an “indefinite delay” on Xbox due to “challenges” with the platform.

Although the public statement was restrained, comments made in the game’s community Discord by CEO Jacky Greco were far more pointed.

“You can ask Xbox why they haven’t answered us for 2 months,” he wrote.

“Obviously they don’t care about Enotria and they don’t care about you.”

He added, “We’ve Xbox Series X|S version ready, but we can’t proceed with submission and release. I spent a lot of money for porting and they decided to ignore us.”

This latest issue follows recent controversy over the delay of Black Myth: Wukong on Xbox, which, according to some reports, was not due to technical problems but rather a mysterious exclusivity deal.

While the delay has been linked by some to the Series S, others believe it points to deeper issues with Microsoft’s publishing process.

Further stoking debate, Raphaël Colantonio, founder and former president of Arkane Studios, took to X to voice concern about the Xbox Game Pass subscription model.

“Why isn’t the big problem being talked about?” he wrote.

“Cough cough Game Pass.”

“I believe Game Pass is an unsustainable model that is hurting the industry more and more, with Microsoft’s endless money helping to pay for it.”

Colantonio argued that Game Pass, by offering hundreds of games for a low monthly fee, is eroding the value of games and making it harder for developers to earn fair pay.

“Gamers are the only ones who like it because the deal is too good to be true,” he said.

“However, when gamers see how it affects their games, they will even come to hate it.”

Colantonio’s criticisms, though not new, have carried extra weight given his role in co-directing Dishonored, one of the most acclaimed immersive sims of the past decade.

He also expressed anger over the persistent PR narrative that Game Pass does not hurt premium sales.

“Washing a tsunami through the whole industry ecosystem is part of the long game,” he warned.

Others have echoed similar sentiments, pointing out that Game Pass may have helped visibility in the short term but could harm diversity and risk-taking in the long run.

“Either they’ll give up or kill everyone else,” he said.

The effects of Microsoft’s broader strategy have already been felt across its studios.

Mass layoffs have not only led to job losses but also the cancellation of multiple projects that had been in development for years.

This includes high-profile titles such as Everwild and Perfect Dark, cancellations that feed into a growing narrative that Microsoft is struggling to manage its vast portfolio of studios and game projects.

Despite successes like Indiana Jones and the Great Circle, Avowed, and Doom: The Dark Ages, many other studios under Microsoft’s umbrella are reported to be suffering from chronic delays, unclear direction, and internal political pressures.

Some sources say that developers often spend years preparing vertical slices, small, polished sections of a game designed to pitch ideas to executives, without ever being given the green light to move forward into full production.

This endless cycle of vertical slice development, coupled with trend-chasing and management indecision, has reportedly led to spiralling costs and ultimately, project cancellations.

Developers have described situations where prototypes were endlessly reshaped to mirror popular trends, only to end up in disarray.

Such instability makes it difficult to deliver coherent, high-quality final products.

One industry observer explained that many projects fall apart because “a studio [has] to try to please far too many decision makers who are all tugging in different directions.”

Even when projects show potential, some are cancelled to avoid throwing “good money after bad,” especially when development costs have already ballooned and prospects for recovery are dim.

It is clear that many of the issues Microsoft faces are not unique to its organisation.

Mismanagement, project cancellations, and financial pressure affect publishers industry-wide.

But with tens of billions of dollars invested in studio acquisitions, including ZeniMax and Activision Blizzard, Microsoft’s inability to ensure stability is drawing sharper scrutiny.

Some of the criticism has focused on the danger of treating game development as traditional software development.

Unlike business software, game development requires subjective judgement about whether a game is fun or engaging, and such projects are more vulnerable to shifting expectations and creative uncertainty.

Adding to the uncertainty is Microsoft’s apparent shift away from supporting Xbox exclusives.

While games such as Avowed and South of Midnight were released as console exclusives, many major franchises, like Indiana Jones, Forza Horizon, and even potentially Halo, are now being developed for PlayStation and Nintendo Switch as well.

This multiplatform strategy, which started more than a year ago, has left many developers and publishers confused about Microsoft’s long-term commitment to Xbox.

Chris Dring of The Game Business said on a recent podcast that several companies are now questioning whether it is worth supporting Xbox at all.

“Certain publishers and developers have spoken to me, like, baffled by this,” he said.

“They’re going ‘Why should we even bother making an Xbox game if this is the strategy?’ That’s a balance that Microsoft’s going to have to strike.”

Data from Ampere suggests that Sony’s PlayStation platform has significantly outpaced Xbox in active users, with an additional 10 million users gained by the end of 2024.

Console sales have declined, prices have risen, and Microsoft’s focus has reportedly shifted toward artificial intelligence.

To finance that shift, some insiders suggest, the company may be planning further layoffs.

“In order to pay for AI, they are going to try to make up for lost money by laying off people here,” one source said.

“It’s completely disgusting.”

“I didn’t want this to happen in the game business, but it’s doing a lot of harm.”

While Game Pass still provides value for some developers, particularly through launch-day visibility and direct payments from Microsoft, the cracks in the model are starting to show.

Rising subscription costs, ongoing studio restructuring, inconsistent support for developers, and a fractured vision for the future of Xbox leave many questioning whether the platform, and Microsoft’s current leadership strategy, can sustain its promise to both creators and players.