At a pyrotechnics-laden preview event at E3 2019 at the MicrosoftTheater in Los Angeles, Microsoft celebrated its continued commitment to the gaming category. The company previewed a wide-range of new gaming titles and provided a glimpse into what it has on tap for its next high-end Xbox console, codenamed Project Scarlett. The disclosure did not come until late in the 90-minute event, but the handful of technical details shared by Microsoft gaming head Phil Spencer had the 7,100+ attendees gasping in awe. Project Scarlett wasn’t the only big news that caught the attention of Xbox devotees, analysts, and press in the cavernous Microsoft Theater—let’s take a closer look.
Sony’s absence at E3 allows Microsoft to fill the void
Microsoft used Sony ’s conspicuous absence at this year’s E3 event to not only tout its next-gen console (which will be released during the upcoming holiday season) but to maximize visibility around the 60+ titles it showcased at the event (including the nostalgic return of the venerable Microsoft Flight Simulator). Readers of this column will recall that Microsoft has been on a content spending binge for new studios since last year’s E3. These activities have produced tangible results for its Xbox Game Studios Division, with popular titles such as Age of Empires, Forza, Gears of War, Halo, and Minecraft (just to list a few). The event even had a bit of Hollywood star-power, with actor Keanu Reeves’ brief on-stage appearance to plug his participation in Cyberpunk 2077. For those thinking that Microsoft’s hunger for acquisitions had been sated, that thought was quickly dispelled by the announcement that Xbox Game Studios had acquired Double Fine, the studio behind Psychonauts and Broken Age.
Microsoft’s Project xCloud is decidedly different from Google Stadia for game streaming
While Microsoft didn’t answer every question about its Project xCloud game streaming service, it announced that the service will be free and arrive in the October timeframe. One of the things we do know is that the service will let you play Xbox titles across multiple devices, including phones, tablets, TVs, and personal computers. Moreover, unlike GoogleGOOGL +0% Stadia, which is a strictly cloud-based gaming experience, users will be able to stream games directly from their own Xbox consoles instead of its servers. Microsoft enabled this capability with Windows PCs a few years ago, and the company’s cloud expertise should facilitate significantly better performance. I was given a demo of the ability on an Android smartphone at an exclusive analyst briefing before the Xbox preview event, and I was impressed with the responsiveness, how smooth the graphics were, and the nearly non-existent latency. Not too shabby.
Microsoft previously announced that Project xCloud will support every Xbox One title, providing it with a stable of more than 3,500 games (putting Google Stadia’s announcement library of just 25 titles to shame). Microsoft execs are undoubtedly savvy enough to know that xCloud’s chief competition will be Stadia. Offering it as a free capability for Xbox hardware console owners, along with an extensive library of supported titles, gives it a substantial competitive edge until Stadia’s performance is better understood. And did I mention that xCloud will be free?
Next-gen Xbox console codenamed Scarlett is “crazy powerful”
Sporting 8K resolution and capable of running up to 120 frames per second (yes, I said 120), Microsoft’s next-generation Xbox is bound to keep console (and perhaps even PC gamers yearning for more plug and play convenience) salivating for the next several months. The company claims that it is four times more powerful than its predecessor, the Xbox One X. In a nice win for AMD , Scarlett will feature a custom AMD 7nm Zen 2-based Ryzen 3000 processor with accelerated ray tracing and high-speed GDDR6 memory support. Phil Spencer went out of his way to emphasize that Scarlett will be 40% faster than current consoles due to its utilization of next-generation SSD. “Crazy powerful” is almost an understatement.
With today’s announcements, Microsoft is doing all the right things to keep its gaming strategy humming, if not enviable. The company has done a marvelous job over the past 12 months on the exclusive content front by acquiring more studios, and its popular Game Pass streaming service will certainly gain subscribers with the company’s announcement that PC games will be added to its $10 per month subscription service free of charge. That’s a big deal when you consider the amount of top-flight Xbox and PC game titles that will be available to Xbox aspirants.
The announcement of Microsoft’s next-gen console and xCloud speaks volumes of where the company believes the gaming industry is headed. As a former exec who helped launch the XPS gaming brand at Dell and oversaw the marketing function at Alienware in the early 2000s, I’ve always had a bias toward powerful hardware in the gaming space. I’m still a bit skeptical (until proven wrong) that an utterly cloud-based approach can replace the immersive gaming experience that great consoles and PCs provide. With xCloud, Microsoft is hedging its bets to a degree by allowing consumers to have choice and pick the gaming experience that suits them best—whether it’s at home or away, in a device-agnostic manner. This is not to say that Google Stadia will be dead on arrival, but until its completely cloud-based approach is validated from a performance, video quality, and low latency standpoint, Microsoft’s strategy appears more sound and likely to win. While it would be unfair to count out Sony, it elected not to attend E3 and has been exceedingly coy about its next-gen PlayStation hardware plans. Microsoft seems to be touching all the right bases now from a content, subscription services, unique cloud implementation, and compelling hardware standpoint. Given all of this, it’s hard to argue that Microsoft isn’t currently in the driver’s seat in the gaming space.