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Xbox One's second bid for the core gamer

Microsoft on the strategy behind Xbox One X, the lack of exclusives and why cross-platform play is so important

After the livestream, I sat back in my chair and tried to digest what I had just seen.

Who was going to buy this? I asked myself. There is a distinct lack of original software, the games that are coming are perfectly playable on the previous machine, the price is very high... outside of looking nice, what reasons have they offered people to invest in it?

That was how I felt back in January this year, when Nintendo revealed the Switch. And here we are again, under three months out from the launch of another major piece of hardware, and those feelings are back, although this time it's around Microsoft's Xbox One X.

I gave Nintendo the benefit of the doubt earlier in the year. Perhaps the company knows something that I don't, I reasoned, and it has since gone on to prove just that. So as I attended Gamescom, and was given access to some of Xbox's leading strategists, I decided to extend that same courtesy to Microsoft.

The Xbox Gamescom live show struggled to impress media, but pre-orders were strong

The first thing to ascertain is who the console is actually for. Xbox One X is not aimed at the broadest possible audience. All the jargon around HDR and Terraflops puts it in a very particular market segment.

"It's for the person that wants the absolute best versions of the games," says Mike Ybarra, the corporate VP of Xbox platform engineering. "Usually people who are highly into electronics, who are really like the core gamer in terms of the amount of time and investment that they put into the product."

That's not an easy sell. This customer segment already owns a PS4, or Xbox One, or gaming PC. So Microsoft is asking them to spend $500/£450 on an upgrade to a product that already own.

Xbox's Mike Ybarra live from Cologne

"The proof will be in the games and how they light up," Ybarra says. "But to your point, a lot of those core customers usually have every console, and a PC, and a phone, and they game on every type of device. They probably have all the latest technologies in terms of the TV that they are using. That's the target audience and we know from the early reception, with them seeing the games, that the power that this has is a draw to that audience."

This positioning also puts itself up against Nintendo Switch. Although the platforms are very different on the face of it, Nintendo will be hoping to position Switch as a 'second console' to fans of PS4, Xbox One and PC. There will be customers out there having to choose between a faster, more powerful version of what they already have, and Nintendo's alternative device.

"A lot of those core customers usually have every console, and a PC, and a phone. They probably have all the latest technologies in terms of the TV. That's the target audience for X"

Mike Ybarra, Xbox

"That is a very different customer," dismisses Ybarra. "I love what Nintendo is doing with the mobility element. They are not going for the highest pixels... in fact, almost the opposite. It is funny, because Nintendo is a block from us, and so we see their employees and we talk... we complement each other more than we compete. To me, I embrace the gamer that has all the platforms, plays all the games, and the excitement that they bring."

Whether Switch competes or not, Xbox One X seems to have started strongly - at least in terms of early pre-orders (although it's hard to really tell without actual figures). But if Microsoft wants to sustain the momentum beyond the initial launch week (something the company has struggled to do during the lifecycle of Xbox One), then it'll need to offer a compelling slate of games.

After last week's livestream, the feeling is that Xbox doesn't have that. Its line-up this side of Christmas has been hurt by the delay to Crackdown 3. Although the Sumo Digital-developed game was no Halo, it certainly had more potential than Super Lucky's Tale.

It was a brave decision to delay the action game into spring next year, although an understandable one. Microsoft pushed a game out a little before its time last year in the form of ReCore (which it is now trying to give a second chance with an updated release), and the commercial and critical response was disappointing.

Shannon Loftis leads Microsoft's first-party work with external developers

"I would consider myself not very good at my job if I did not learn from every single release," explains Shannon Loftis, who leads Microsoft's first-party efforts outside of its internal studios.

"We have a principle where it is right game, right experience, right time, in that order. That principle is definitely stronger after the ReCore release. That was the framework in which we made the decision that Crackdown 3 needed more time, and so we can deliver the game that fans deserve.

"It is not a decision we made easily, but the logic is irrefutable. The game will be better because we're giving it more time."

It may have been the right decision, but it nevertheless hurt Microsoft's Q4 line-up. Super Lucky's Tale and Cuphead won't shift too many consoles, and Forza is unlikely to win over the core gamer in the same way as a AAA action game can.

Instead, Microsoft is placing PlayerUnknown's Battlegrounds - the PC game which is initially coming to Xbox One as a console exclusive - to the fore.

PlayerUnknown's Battlegrounds is Xbox One's biggest holiday launch, says Microsoft

"We do have exclusives and you brought up probably the biggest exclusive that we have this holiday," Loftis says. "PlayerUnknown is the most popular game in the world right now with 8m players. Every time you blink it seems like they add another 1m."

She continues: "It's one of those new phenomena, a game that effectively marketed itself. It is an incredibly fun game to watch and it's an amazing technical feat, frankly, to make a 100-player battle royale work so beautifully. It is very significant to bring that to Xbox."

PlayerUnknown's Battlegrounds has the potential to be a major signing for Xbox One and, of course, it comes with enhancements for Xbox One X. It is unquestionably popular, although it feels strange to suggest Microsoft's Q4 hopes rest on a port of a PC game that was released in March.

"PlayerUnknown is the most popular game in the world right now with 8m players. Every time you blink it seems like they add another 1m

Shannon Loftis, Xbox

Indeed, it wasn't long before Ybarra and Loftis' answers moved from exclusives to the 100-odd games that will boast 'Xbox One X enhancements', particularly those from third-party studios. "We literally have the goal that [Xbox One X] plays the best version of every single game period," Ybarra explains.

It's not an insignificant message to promote, especially with the third-party titles that are coming up. If Microsoft can convince most major developers to create Xbox One X versions of their games, that will be a strong selling point to push next year, particularly alongside titles such as Far Cry 5 and Red Dead Redemption 2.

But are the differences really significant enough to warrant the purchase?

Loftis, unsurprisingly, thinks so: "I don't like to say this now because it makes me look stupid, but I was always a 4K sceptic. I did not understand it until I started to work on an Xbox One X dev kit. I didn't understand how visceral the experience will be when you are playing a game in 4K with HDR on an incredible TV and you have Dolby Atmos and it is locking and keeping frame rate. That is the thing that ultimately is going to bring the people to Xbox One X."

Matt Allen, director of Technical Art at Monolith (which is working on Middle-earth: Shadow of War), also talks up the impact of 4K gaming.

"Microsoft has been bringing journalists to Monolith to show off Shadow of War," Allen begins

"After we have shown the stuff to the journalists, the artists will come in and look at it because they have only seen their stuff in 4K. And seeing it in HDR, they get to see the full gamut of how the lighting affects all of these materials. And you get a row of artists just staring at their work... it's like they're seeing it for the first time. When you just see it, and it's new and you have nothing to compare it to, you think it looks cool. But if you know the content well, it is just so different. And when you have seen it like this, and you go back to the previous version, it just looks dull. We've had bugs where they've said everything looks a bit grey, but it's just that they're playing it in SDR, and they're used to it in HDR."

Middle-earth: Shadow of War is being used to push Xbox One X's graphical capabilities

Monolith was one of the first studios to announce its intention to develop for Xbox One X (or Project Scorpio, as it was at the time), but it only really started working with the tech six months ago. The key element as to whether studios will make Xbox One X enhanced games will be whether it's easy to do. So was it?

"We have our own internal cross-platform engine that we've worked on for years," begins Allen. "You want your content producers to produce the best possible content that they can. You don't want them to worry about which platform, or how it looks on this one or that. You want them to create something that is as good as this thing should look, and then you make it look as good as you can for each platform... that's why I have a job, basically.

When you have seen Shadow of War [on Xbox One X], and you go back to the previous version, it just looks dull

Matt Allen, Monolith

"So our engine has a pretty cool layer, where the content guys just go and make incredibly high res stuff. 8K face textures for the orcs, 16K body textures... millions of triangles on the models. And there's a layer that says: I'm going to do this so it works on a low-end PC, and I'm going to do this for PS4 and Xbox One'. So that means when a more powerful system comes out all we have to do is tweak that layer, because the content guys are making stuff we still can't show.

"From a content standpoint, it didn't take long to get it working. From an engineering standpoint, because it shares a lot of DNA with Windows 10 - and we are already running on Windows 10 - it took our engineering director about a day to get it running on the original Scorpio kits. It wasn't perfect; there were edge cases, so it involved a bit of tinkering, but it was not a lot of extra work.

"The extra work comes in with the extra stuff you can do, like HDR. HDR is a colour space that is sort-of new to games, and a lot of games are using physically-based rendering. We developed PBR in a standard colour range, but when you get into HDR the colour range gets all wonky, because there is so much more... so there was about a month of iteration trying to get the lighting correct."

So it's easy enough to develop for, if not totally painless. And with the games comes the boast from Microsoft that Xbox One X is the console with the best-looking third party titles, a boast it has not been able to make over the previous four years.

Yet is this really enough to convince PS4's new army of customers to switch machines? Let's not forget that Sony has a 4K device of its own (although not quite with the same capabilities ), and we find ourselves back talking about the exclusive games that will convince customers to purchase an X.

The number of first-party games from Microsoft appears to be on the decline. Over the last 9 months, it has launched just Halo Wars 2 (that's as many games as Nintendo has built for Wii U this year). Things look stronger for the next 9 months, but there's still a sense that Microsoft has altered its first-party strategy.

"What we've noticed during this generation is that it's less of a case of spending a couple of hundred million on a blockbuster, as it is a case of creating a small game that gamers latch onto because it is great to watch"

Shannon Loftis, Xbox

"Right now we are very focused on games that bring people together, who form communities and find ways to self express," Loftis explains. "What we've noticed during this generation is that it is less of a case of going out and spending a couple of hundred million and putting a blockbuster on a shelf, as it is a case of creating a small game that gamers latch onto because it is great to watch, or there are awesome screen clips that you can share with others. We are indexing on that quite a bit."

PlayerUnknown, Sea of Thieves, Crackdown 3 and State of Decay 2, the four main titles that will define Xbox over the next 9 months, certainly fit the bill of this sort of game. And Loftis isn't wrong when she observes that spending $100m on a blockbuster is no more likely to succeed than an inventive independent concept like Rocket League or Ark: Survival Evolve or Minecraft.

But does that mean an end to story-driven Xbox titles like Quantum Break?

"No," Loftis says. "There is a fun YouTube search that I like to do: 'Reactions to people watching the Ori and the Will of The Wisps trailer'. It is a blast watching their reactions and seeing them crying, good crying, over the game. Even the ability to share a reaction to a story, or to share how something made you feel in that moment, that is a viable social mechanic. There will always be a need to tell these stories, like Ori or like Zelda. Zelda is an incredibly social game, and just because you are playing it by yourself, doesn't mean that the entire world isn't sharing your experience.

"The fact that we have the ability to share screens, share commentary, and groups, and clubs on Xbox Live... those are ways to bring people together around a game that is more story orientated."

But it's all about creating that social engagement. "Games that build community... these are games that people come back to again and again," Loftis continues. "And they come back as much for the social experience as they do the gameplay. I actually think that is for the greater good of society. Things that bring people closer together as opposed to driving them apart. There are a lot of things driving people apart right now, and I'm proud to be part of an industry that does the opposite."

Xbox One X is not a grand re-launch for the platform, but part of a wider vision

Microsoft sounds genuine about its desire to bring gamers together. It's why the firm has been such an active supporter of cross-play, which allows gamers to compete against each other irrespective of the machine they own - although PlayStation isn't playing ball for now.

"Our mentality is not to make it about iPhone gamers, Android gamers, Xbox gamers, Nintendo gamers, Sony gamers... let's just think of them as gamers," Ybarra adds. "If you have a game that you love, then you should be able to play with the biggest number of people. That is something we embrace. Minecraft sets the tone with that when looking at cross-platform. Age of Empires is going to do that, too... we've worked very closely with Valve to make sure that Steam games work between PC and console. Let's make games that unite people, rather than divide them by platform."

There is some strategy around this way of thinking. For all the emphasis we're placing on X - on this being the grand relaunch of Xbox One - it's important not to forget the wider Xbox game plan. Microsoft's aim is to grow and sustain its Xbox Live users, not its hardware figures. It's notable that the biggest announcement it made at Gamescom was Age of Empires 4 - a PC game.

That's why Xbox is investing so much in these community titles, it's why Sea of Thieves has cross-play with PC, it's why the firm is experimenting with its Netflix-style Game Pass business model, and why it wants PlayStation gamers competing with its own.

In the context of that wider strategy, the objective for Xbox One X is clear. This is the product designed to attract the one audience that Microsoft has struggled with this generation - the core gamer and the tech enthusiast (just like Ybarra said). And it sits alongside S, Minecraft, Age of Empires and all the rest as a way to encourage more people to play within the Xbox ecosystem.

Will it work? I'm not sure. But just like with Nintendo Switch, I'm prepared to accept that Microsoft might just know what it's doing after all.

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Christopher Dring avatar

Christopher Dring

Head of Games B2B

Chris is a 15-year media veteran specialising in the business of video games. And, erm, Doctor Who