Examining Microsoft's First-Party Library Problem
What a difference a handful of years can make. During the Xbox 360 era, Microsoft enjoyed an extraordinary run of first- and second-party content, expanding its library of console exclusives with major successes like Gears of War and Left 4 Dead. If you wanted to play the critically acclaimed titles from the Halo, Forza, or Fable, you had to buy a 360. Just four years after the platform launched, Microsoft had five exclusives rated 90 or above on Metacritic, and 13 games rated 85 or above. It also became the de facto platform for most Japanese RPGs, which had traditionally called PlayStation consoles home.
As we approach the four-year anniversary of the Xbox One, the stark difference in game exclusives astounds. Only one title, Forza Horizon 3, cracked the 90 mark on Metacritic thus far, and only three exclusives are rated 85 or above. The early attempts to energize the platform with compelling new IPs like Sunset Overdive, ReCore, and Quantum Break either underperformed or didn’t do enough to convince Microsoft to make sequels. The rest of the announced 2017 slate, which includes Crackdown 3, Sea of Thieves, and State of Decay 2, may also struggle to bring new players to the platform.
At the same time, the PlayStation 4 is bursting at the seams with quality exclusives like Bloodborne, Uncharted 4: A Thief’s End, Nioh, The Last Guardian, and the recently released Horizon Zero Dawn. The JRPGs have returned to PlayStation, and players still have blockbusters like The Last of Us Part II and God of War coming soon. With this noticeable deficit in exclusive quality, the sizeable gap in install base between the direct competitors is understandable. Currently, the PS4 has more than 54 million owners, while the Xbox One only had 26 million as of last January.
This begs the question – why the precipitous drop in high-end exclusives for Microsoft?
Part of the problem is investment. Microsoft simply doesn’t spend as much as Sony on first-party endeavors. Sony Interactive Entertainment has 16 studios under its umbrella, including standouts like Naughty Dog, Guerrilla Games, and Media Molecule. By comparison, after the recent closures of Lionhead and Ensemble and the departures of Bungie and Twisted Pixel, Microsoft Studios only has seven. One of those, Mojang, makes Minecraft for nearly every platform under the sun, so it doesn’t even contribute to the first-party exclusive lineup. Microsoft has attempted to plug these gaps with timed exclusives like Rise of the Tomb Raider, but we’ve yet to see proof that this is a smart investment that helps the platform.
Another issue is the fading sheen on Microsoft’s most recognizable franchises. While legacy properties like Gears of War and Halo were once benchmark setters for quality and innovation, the studios that created these franchises have moved on and recent entries under the supervision of 343 Industries and The Coalition, respectively, haven’t matched Bungie and Epic’s high standards. Halo 5 and Gears of War 4 are by no means bad, but the competition in the shooter genre keeps getting fiercer with new entries like Overwatch and Destiny. The only Microsoft franchise that continues to lead its genre is Forza, which sits firmly in pole position for simulation racing.
Microsoft’s unfortunate string of first-party cancellations isn’t helping matters, either. Scalebound and Fable Legends were both discontinued this past year, creating unanticipated cracks in the Xbox One lineup.
Perhaps the biggest problem facing the Xbox One’s prospects is Microsoft’s self-imposed cannibalization of first-party exclusives. The Play Anywhere initiative requires all Xbox One exclusives come to Windows 10 as well. If you can play the latest Halo, Gears of War, or Forza game on a PC, what incentive do you have to buy an Xbox One? The hardcore gamers could instead get the best of both worlds by investing in a PS4 and gaming PC.
Microsoft is keenly aware of its current first-party deficit. In a recent Twitter Q&A, Xbox head Phil Spencer said, “Microsoft is very focused on 1P games. I’ll be careful about when we announce things but I know strong 1P is critical.” Perhaps this summer’s E3, where Project Scorpio will take center stage, will include some software surprises as well.
First-party exclusives aren’t the only factor a gamer considers when making a console purchase. Some value continuity, preferring to stay with their Xbox Live friends and continue to build their gamerscore. Others factor console horsepower and controller ergonomics into the equation. For thrifty gamers, it comes down to price. The Xbox One is competitive on all these fronts, and Project Scorpio presents another opportunity for Microsoft to push its platform. But if Microsoft wants to keep Xbox as a viable player in the living room for the Xbox One era and beyond, recommitting to first-party exclusives is critical.
This article originally appeared in issue 290 of Game Informer.