Xbox Reset Continues with Studio Shifts and Layoffs
Xbox's strategic reset has extended indefinitely, with this week's studio reshuffle making Activision the new custodian of Halo and moving Obsidian under
The Xbox reset, originally announced as a 'next hundred days' initiative, has now stretched past that timeframe with no end in sight. This week's studio reshuffle made Activision into effectively the new custodian of the Halo franchise and moved Obsidian under the Bethesda umbrella.
Layoffs and the ongoing reset
Another 268 jobs were cut this week. Roughly 1,600 jobs were already gone prior to this week. The promised reset has seen hundreds and hundreds of layoffs across Xbox studios and business units. Even after this week's layoffs, there are still hundreds of more job losses to come before the 3,200 job reduction target is reached. Microsoft is working toward that 3,200-job reduction signaled earlier this summer.
Uncertain futures for key studios
The fate of Ninja Theory remains unresolved after no buyer emerged. Ninja Theory will now probably be shuttered. The fate of Arkane, the last of the studios Xbox planned to divest, remains up in the air. Halo Studios, the internal studio created especially for the Halo franchise, is being gutted. What remains is a support studio for Activision's Halo games. Arkane’s future is still unclear.
What remains and what's next
Remaining studios include the developers of the Forza games, the newly merged Playground Games and Turn 10. Gears of War developer The Coalition and Clockwork Revolution developer InXile Entertainment also remain. Minecraft creator Mojang sits directly under the Xbox umbrella organisation itself, alongside Activision, Bethesda, and Xbox Game Studios. Microsoft seems to have some big if not yet very clear ideas about the future of Mojang. Minecraft's success is off at a tangent from the entirety of the rest of the Xbox business. How the division's leadership thinks it can be integrated into their strategy remains entirely up in the air.
Xbox Game Studios raced in to snap up publishing rights to Hideo Kojima's upcoming game, referred to as Physint, when Sony decided to bow out of its partnership with him. Physint means Microsoft, in the throes of its reset, obsessing over costs and efficiency, just made a major commitment to back a very expensive game. It won't be released, even optimistically speaking, until around 2030 or later. Xbox is still spending on long-tail bets like Physint while cutting aggressively.
Leadership and vision gaps
Asha Sharma marked the conclusion of her first hundred days as Xbox CEO with a public blog post calling for the next hundred days to be a 'reset' of the business. Sharma's second hundred days ended a little over a week ago. The hundred-day period was only ever a catchy title for a blog post. Nobody seems to actually know how long this reset will continue. Xbox staff go into work every day with the threat of redundancy hanging over their heads. Microsoft has not given staff a clear endpoint for the reset process. "The whole point of a reset is that you press the button once," Asha Sharma said. One account states that "Nobody has yet deigned to outline a clear vision for what Xbox will actually look like after this reset."
