ITW | P. Spencer and the Xbox future

ITW | P. Spencer and the Xbox future

Something big has happened to the video game industry over the last five years – you may have noticed. All the old rules about consoles – the fact that they enjoyed five-to-eight-year life cycles, the fact that games “just worked” out of the box – they’re all gone. An accelerating consumer electronics sector and the mass penetration of broadband internet have led us into a new era of chaotic innovation and fraught business model evolution. And somewhere in the middle of all this, people are making and playing games. How do those people keep up?

These are very much the concerns of Phil Spencer, the ex-game developer who now heads up Xbox. Spencer has always put himself forward as a fan rather than a suit. His mantra is “we put the gamer at the centre of everything”. But what that actually means is changing – not just in terms of hardware, but in the way games are made and played.

Over the last five years we’ve seen the emergence of a new concept: the video game as a service. What this means is the developer’s support for a new title doesn’t stop when it’s launched. They run multiplayer servers so that people can compete online; and they release extra downloadable content (DLC) in the form of new items, maps and storylines – sometimes free, but very often paid for. There’s a clear reason for this model: the costs of mainstream game development are rising faster than potential revenue. To create 1080p and 4K games, teams are bigger and development cycles are longer, and then there’s the cost of maintaining those online servers. It’s expensive, and one way to pay for it is to ensure that players who enjoy a title stay around and keep investing in the experience.


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