Thank you for all the entertainment, Phil Spencer.
After nearly 40 years at Microsoft, where he has been involved in the entire Xbox journey, half of which as the top dog, Phil Spencer has now retired, and we take a look at his career...
Things moved quickly on Friday when major changes were confirmed in the leadership of not only the Xbox division, but also Microsoft's overall gaming ventures. Gaming boss Phil Spencer was confirmed to be leaving the company on the same day, only to be followed by his closest colleague, Sarah Bond. She was also confirmed to be leaving, and the new gaming boss for Microsoft's gaming venture is Asha Sharma.
But... let's talk more about Spencer. How will his contributions to Xbox be valued in the future? Xbox will turn 25 in 2026, and Phil Spencer has been at the helm for 12 of those years. It is therefore doubtful that anyone else has had the same impact on the brand as he has. But let's rewind even further. The fact is that 58-year-old Phil Spencer started his career at Microsoft back in 1988.
Spencer's interest in gaming meant that he was already involved in the company's gaming ventures at that time, and in the early 1990s he led the development of CD-ROMs, such as Encarta. From there, he continued to work with various consumer products (including Works, for those of you who remember it) and games, until he joined the then newly formed Xbox team full-time in 2001. So he has literally been there since the beginning.
His first role for Xbox was actually as general manager of Microsoft Game Studios EMEA (Europe, Middle East and Africa division), so he had the honour of managing Xbox in our part of the world with responsibility for recruiting developers, managing marketing and other tasks. Phil Spencer was one of the key players who led to the acquisitions of Lionhead and Rare, among others.
When Peter Moore took over the Xbox division after Sega's departure from console manufacturing in 2003, Spencer was heavily involved in the work, and in 2008 he was promoted to general manager of Microsoft Studios, making him one of the real Xbox bigwigs. 2008 was also the first time we at Gamereactor wrote about Spencer, when he was mentioned in a news item on the network.
Since he became head of gaming, it was largely thanks to him that we got all the exciting initiatives during the Xbox 360 era. There are plenty of stories from colleagues who say that Spencer, who was interested in gaming, was often involved in games at a detailed level and enjoyed beta testing and giving his opinion. However, he was not as involved in Kinect. After Peter Moore left Microsoft in 2007, Don Mattrick took over, and he had a different view on how to run the console business. He wanted to focus on a few major brands and try to create something as popular as the Wii remote.
Many have pointed out that Spencer was also one of the top brass in the Xbox team at the time, and even though he himself did not want to disassociate himself from Kinect, there is much to suggest that it was not his creation. Spencer had a "gamer first" philosophy, which did not go hand in hand with this. When it came to the Xbox One, it seemed that everything but gaming was important, and there was a lot of talk about TV initiatives and Kinect - while the console had worse performance than the PlayStation 4 but cost $100 more.
However, Spencer's role seems to have been primarily gaming again, with investments in Halo and Titanfall, among others. When criticism of Xbox One was at its worst, Microsoft realised that they had developed a concept that did not appeal to the audience willing to shell out for new hardware, and that also had regulations that were perceived as consumer-unfriendly (although, in fairness, it should be said that they were probably ahead of their time, as most of their proposals have now been implemented).
Don Mattrick was more or less forced to leave his role, and Spencer said he wanted to take over as Xbox boss, with proposals on how he could pick up the pieces of a brand that had been so beloved just a few years earlier. This included scrapping the new rules, abandoning the idea of requiring Kinect and increasing investment in games again.
However, the Xbox brand was in a sad state, and to make matters worse, Sony seemed to be doing everything right after making a series of wrong decisions with the PlayStation 3. This meant constant headwinds for Microsoft, which was unable to launch the console simultaneously worldwide, with delays in many places, including Europe. In addition, the console was beaten by the PlayStation 4 in virtually all console comparisons made, as it simply wasn't powerful enough.
If there is one bright spot to highlight, it is that Spencer did a good job in his role as head of gaming, and the fact is that Xbox One had more exclusive games than Sony's format in its early years. Thanks to titles such as Ryse: Son of Rome, Forza Motorsport 5, Halo: The Master Chief Collection, Forza Horizon 2, Sunset Overdrive, Titanfall and Ori and the Blind Forest, the Xbox One managed to keep up despite the poor conditions. With a better console and a more gamer-friendly image, it could probably have done really well.
But it's hard to understand if you weren't there, how criticised Xbox was at the time. Not even the sleek Xbox One S, which arrived three years into the generation and offered the most attractive Xbox design ever, could change that. Microsoft seemed unwilling to invest in the battered brand, and Sony caught up with its games, leaving Xbox One in the rear-view mirror. According to several sources, Microsoft considered simply leaving gaming behind, and Spencer had meetings with CEO Satya Nadella to formulate a strategy for the future.
This later resulted in the impressively powerful Xbox One X and investments to strengthen development capacity. For two years, it felt like Microsoft had new acquisitions to announce at every new event, and optimism slowly began to return to the green team. But... making games takes time, and none of Microsoft's new studios would have time to release anything completely new before it was time to launch the current console generation. Spencer said at this point in the generation, the Xbox One was the worst possible console to make a mistake with:
"We lost the worst generation to lose in the Xbox One generation, where everybody built their digital library of games."
In short, people were reluctant to switch consoles when the new generation took over because they already had a library for the PlayStation 4. It was better to buy a PlayStation 5 so they could continue using their games.
However, Spencer had more ideas for how to turn things around for Xbox One, the most notable of which was Game Pass. The idea was to consume games in the same way as Netflix, i.e. a subscription that gives you a wide selection, including new games. For a long time, it was an incredibly good deal, but surprisingly few people took advantage of it - simply because they didn't have an Xbox. And, of course, few people bought an Xbox just to be able to subscribe, as it would have been an expensive subscription.
Another new approach Spencer tried was to fully support PC with new releases. Windows is also a Microsoft format, so it felt logical. Many people opposed this, arguing that it undermined the point of buying an Xbox, but if we look at today's market, Sony has largely adopted the same strategy.
The biggest game acquisition Microsoft had made up to that point was when they bought Mojang and Minecraft in 2014. However, this game did not become exclusive, but continued to be released and supported on all formats. When the current generation began, Microsoft announced that they would make an acquisition that led to an uproar, namely Bethesda. Once the acquisition was complete, it seemed that Spencer was ready to fight to seriously strengthen Xbox and take on Sony. He said this about why Microsoft wanted to take over the Elder Scrolls developer: "This is about delivering great exclusive games on platforms where Game Pass exists."
Just a few years later, he had completely changed his mind and announced that exclusive games were nonsense, as Microsoft would support all formats. Things probably didn't go quite as Spencer had planned. The desire to spoil Xbox players was probably there, but the new studios they had acquired had nothing in the pipeline, so there was a poor flow of new games. Halo Infinite received a lot of criticism when it was unveiled and was delayed by a year, and when it was finally released, all support disappeared immediately. The Gears of War series failed to replace the old protagonists, Forza Motorsport received lukewarm reviews, and it's no exaggeration to say that the Xbox Series S/X had a miserable start, despite initially flying off the shelves during the worst of the pandemic.
Something that has definitely fuelled the perception that multi-format is the future is the record-breaking acquisition of Activision Blizzard. A bold move, but it still seems to have led to some unforeseen consequences. For example, they couldn't really remove Call of Duty from PlayStation because it would mean losing huge revenues, and because they wouldn't have been able to buy the company in the first place. In addition, many Xbox fans commented that they didn't think they were getting anything of value when Microsoft was in fact just stopping releasing games for a competing format. It was impressive that Spencer and Sarah Bond still managed to push through the purchase, but perhaps it contributed more to the dilution of Xbox than it actually added?
The fans were understandably disappointed, and the previously acclaimed and well-liked Phil Spencer was increasingly criticised. After four weak years with the new console, rumours began to surface that major changes were afoot at Microsoft, with frequent talk that exclusive Xbox games were on their way to the PlayStation 5. Today, we know that this turned out to be true, and since then, the Xbox brand has taken a huge beating.
Prices have been aggressively raised on both Game Pass and hardware, and without exclusive games to attract customers, they have flocked to alternatives, both console and PC. Microsoft has consistently struggled to explain why you should buy an Xbox, while actively advertising that you don't even need one, because everything could be an Xbox.
A new console appears to be on the way, and judging by the latest rumours, it will be a PC hybrid, which would mean that in the future, Xbox will be exclusively an ecosystem and a competitor to Steam. For two years, Phil Spencer has made fewer and fewer public appearances, and rumours and credible insiders have said that he has been tightly controlled from above and is no longer able to act as he might have wished.
As of yesterday, Phil Spencer is no longer head of the Xbox division. There are conflicting reports as to whether he left voluntarily or after discussions with his boss (Satya Nadella), but he has been with Microsoft for nearly 40 years and has been part of the entire Xbox journey, half of which as boss, and is now only a few years away from retirement. He is 58 years old - which happens to be exactly how old Reggie Fils-Aime was when he left Nintendo of America to retire.
Xbox has changed significantly under Spencer's leadership, not always for the better (such as the closure of Everwild and Perfect Dark), but most seem to agree that he has been a positive force in the gaming industry. Whether his plans for the next generation will lead to the return of Xbox as hardware remains to be seen, but at present, many would say that it has a somewhat tarnished reputation as a result of Xbox having been at a significant disadvantage since the Xbox 360 days and being so much smaller than PlayStation in particular that many games have simply not been released.
At the same time, there is a certain irony in the fact that Sony has had a fairly empty slate of games for two years, while Microsoft's many studios have really gotten going. Had Microsoft gone ahead with exclusive games, they could probably have attracted PlayStation fans with their deluge of heavyweight titles. But if that is the case, we will never know.










