Xbox chief envisions a Netflix model for narrative games

Phil Spencer realizes that it might not work for every type of game, though.

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Microsoft has just tipped its hand for what the company will show off at E3 in June. In a wide-ranging interview with The Guardian, Xbox chief Phil Spencer laid out his plans for the future of Xbox software. Since (mostly) fixing a majority of the problems the Xbox One hardware and system software has suffered through since 2013 with the Xbox One S and the Creator's Update for Xbox firmware, Spencer is focusing on the other problem Microsoft faces: its dearth of unique and compelling reasons to buy into the improved Xbox platform.

Spencer told The Guardian that his company has crowed about the consumer-facing side of what its online infrastructure offers (Xbox Live's new features like clans), but now we're going to start hearing about what that back-end can do for developers. Which, in turn, trickles back down to consumers. Part of that is opening up its Azure cloud servers to smaller developers as a means of helping them build a service-based game that'd otherwise be impossible due to the monumental costs of setting up infrastructure. Basically, Microsoft wants to do smaller scale versions of what it did for developer Respawn Entertainment's debut title, the multiplayer-only Xbox-and-PC game Titanfall.

He specifically cites Electronic Arts' FIFA Ultimate Team as being a model for success in terms of service-based games. That might not be the best example, though. A card-trading game within FIFA proper, for quite awhile Ultimate Team was rife with folks exploiting the game, farming coins needed to buy high-skilled footballers.

But Spencer does realize that not every type of game will work as a service; locking areas of games behind microtransactions or paywalls isn't a good fit for, say, huge single-player action-adventure games.

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Regarding those, his comments were frank:

"The audience for those big story-driven games... I won't say isn't as large, but they're not as consistent. You'll have things like Zelda or Horizon Zero Dawn that'll come out, and they'll do really well, but they don't have the same impact they used to have, because the big service-based games are capturing such a large amount of the audience."

He added: "Sony's first-party studios do a lot of these games, and they're good at them, but outside of that, it's difficult -- they're becoming more rare; it's a difficult business decision for those teams, you're fighting into more headwind." Internally, Microsoft had Quantum Break last year, a big-budget narrative-driven game with no online multiplayer and zero post-launch add-ons. It was a unicorn for Microsoft if there ever was one.

"We've got to understand that if we enjoy those games, the business opportunity has to be there for them," he said.

Quantum Break from developer Remedy Entertainment.

Looking at Microsoft's usual software suspects, everything has multiplayer of some sort. The company's predictable-to-a-fault release cadence of Forza, Gears of War and Halo all feature robust multiplayer components that last long beyond the dozen hours it takes to get through the latter pair's story modes. Forza is basically an always-online racing game, regardless of which subtitle the annual release has. You race against opponents whose AI is based on the behavior of real players, and leaderboards keep you constantly in the loop of where your hot lap time sits in relation to friends.

The upcoming Sea of Thieves is a cartoony take on a pirate's life, and you're playing the open-world role-playing game with people around the globe. That's the type of future that Spencer is hinting at.

How will it apply to the traditional single-player games that are a "difficult" business decision? He's floated the idea of subscription-based games along the lines of what developer Telltale does with its Game of Thrones, Minecraft and The Walking Dead franchises: narrative-based games that release episodically versus giving players everything at once.

"I've looked at things like Netflix and HBO, where great content has been created because there's this subscription model. Shannon Loftis and I are thinking a lot about, well, could we put story-based games into the Xbox Game Pass business model because you have a subscription going?" Game Pass is still in its infancy, but the pitch is that for $10 a month you'll get access to over 100 games from the Xbox 360 and Xbox One back catalog. It's supposed to launch sometime this year.

"The storytelling ability in TV today is really high, and I think that's because of the business model. I hope as an industry we can think about the same," he said. "[Subscription services] might spur new story-based games coming to market because there's a new business model to help support their monetization."

This sounds ambitious, indeed. Especially coming from a company whose interest in creating unique narrative experiences has waned in recent years. It's an accusation Spencer has heard plenty of times. "I want to say to people: that same level of commitment you felt from myself and from the team as we've evolved platform over the last three years -- as we've evolved service over the last three years, as we've evolved and innovated hardware over the last three years -- is going on with our first party [development studios]."

Spencer has said that paying for third-party exclusives (like it did with Rise of the Tomb Raider in 2015) isn't a smart long-term business move, and he isn't wrong about the work Microsoft has done improving the Xbox, so maybe there's reason to believe him. The Xbox One of today looks and feels nothing like the console that launched in 2013, both in terms of hardware and the system software running on it -- in a very good way.

But Microsoft's grand ambitions have failed before. Coming off the staggering success of the Xbox 360, Redmond's cocksure original mission for the Xbox One was to take over your living room and control your entire TV experience. That never happened. The do-all Kinect sensor is effectively dead. The buzzards have long since left Xbox Entertainment Studios' carcass behind, too. Now, Microsoft is just happy if you buy an Xbox and a few games. And it hopes that maybe you'll pony up for an unproven service in addition to your subscription to Xbox Live for online multiplayer.

So, going into E3 this June, Microsoft has a few things to prove: The value of its high-powered Project Scorpio console, that it can make subscription-based games and that these aren't just the same platitudes we've heard from the company before.

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