[Update] Microsoft Will Close Xbox Entertainment Studios

by Mike Futter on Jul 17, 2014 at 02:56 PM

Update #3: After telling us that it wouldn't be commenting on Quantum Break and a possible connection with the Xbox Entertainment Studios closure, the company has apparently changed its mind. Speaking with Polygon, Microsoft says that the development of Quantum Break is "not impacted" by the decision to close Xbox Entertainment Studios.

Update #2: We inquired about the status of Remedy's Quantum Break, which will have live action segments, to find out if Xbox Entertainment Studios is involved in the project. A Microsoft representative declined to comment. 

Update #1: Microsoft has confirmed to us that it will close Xbox Entertainment Studios in the coming months. This will reduce a significant portion of planned programming, but in-development work like Halo: Nightfall, the Halo television series, and the Atari documentary Signal to Noise, will continue.

Nancy Tellem, Jordan Levin, and some other staff will stay on to complete the programming already in progress. This will not impact the NFL partnership, apps, and delivering television via the Xbox One alongside cable partners. Phil Spencer communicated this to staff today in an email, which has been provided to us.

I hope you have had a chance to read today’s mails from Satya. I wanted to take a moment to share a few thoughts on what this means for our team and some of the changes we are making as a result.

In last week’s mail outlining some of the steps towards creating the culture and organization to bring our ambitions to life, Satya called out the strategic importance of Xbox as a strong consumer brand, a creative center for gaming and a leader in bold innovation. Every member of Team Xbox should be incredibly proud of the impact and reach your work has within the walls of Microsoft, with our developer community and most importantly, with consumers.

Microsoft is the productivity and platform company for a mobile-first and cloud-first world, and games are the single biggest digital life category in a mobile-first world.  Success in this category, by growing a robust Xbox business, brings additional value to Microsoft. I have stated this before, but for Xbox to be successful, we must remain committed to being a consumer-driven organization with the mission of meeting the high expectations of a passionate fan base, to create the best games and to drive technical innovation.

As part of the planned reduction to our overall workforce announced today and in light of our organization’s mission, we plan to streamline a handful of portfolio and engineering development efforts across Xbox. One such plan is that, in the coming months, we expect to close Xbox Entertainment Studios. I would like to take this opportunity to recognize the accomplishments from the entire team in XES. They have built an impressive slate of original programming and pioneered interactive entertainment on Xbox, such as the innovative reality series ‘Every Street United’ that succeeded in uniting audiences around the globe during the recent World Cup. I am pleased that Nancy, Jordan and members of the XES team remain committed to new, original programming already in production like the upcoming documentary series ‘Signal to Noise’ whose first installment takes on the rise and fall of gaming icon Atari and of course, the upcoming game franchise series ‘Halo: Nightfall,’ and the ‘Halo’ Television series which will continue as planned with 343 Industries.  Xbox will continue to support and deliver interactive sports content like ‘NFL on Xbox,’ and we will continue to enhance our entertainment offering on console by innovating the TV experience through the monthly console updates. Additionally, our app partnerships with world-class content providers bringing entertainment, sports and TV content to Xbox customers around the world are not impacted by this organizational change in any way and remain an important component of our Xbox strategy.  

Change is never easy, but I believe the changes announced today help us better align with our long-term goals. We have an incredible opportunity ahead of us to define what the next generation of gaming looks like for the growing Xbox community. I have a great deal of confidence in this team and know that with clarity of focus on our mission and our customers we can accomplish great things together. We already have.

Thank you again for all you do for Xbox.   


Original Story:

Microsoft is reportedly planning to completely revise its television strategy. The Nancy Tellem-led Xbox Studios is said to be trimming back its line of programming, detailed as recently as May.

When Microsoft announced the Xbox One on May 21, 2013, television and original programming were a big part of the presentation. Since then, the company has reversed course on mandatory online connectivity, used games, and the importance of Kinect to the platform. With the appointment of Phil Spencer as head of Xbox, changes seem to be coming quickly. The first major project coming out of Microsoft Studios,

Halo: Nightfall, will have a presence at SDCC next week and will premiere later this year. Xbox Studios is also in production on a documentary about the Atari E.T. failure and subsequent excavation of the burial site for all the discarded cartridges. The news comes on the same day that Microsoft announced 18,000 job cuts by March 31, 2015

CEO Satya Nadella also recently refocused the company on productivity, cloud, and mobile. He also reaffirmed his commitment to Xbox. We’ve reached out to Microsoft for comment and will update should we receive a response.

[Source: Variety]


Our Take
Microsoft was heavily criticized by the core audience for diverging from a core gaming message. The company has been correcting course for months, with a heavy push toward recapturing a straying user base since Phil Spencer assumed command.

The Halo and E.T. projects make a lot of sense, but some of the proposed programming hasn’t seemed like a great fit. Hopefully, Microsoft will be able to keep the shows that have the best synergy while shedding the seemingly tangential programming.