From Kotaku:
Even though E3 has only just gotten underway, most of the biggest companies have already made their biggest announcements, and amazingly, Microsoft’s offering already feels like a miss. I say “amazingly” because Microsoft was the only company to debut major hardware at the show.
Normally when a company announces a brand new console and 22 exclusive titles, as Microsoft just did on Sunday night, you’d be hard-pressed to declare them a loser. The sheer number of announcements Microsoft made is astounding, but shock and awe couldn’t save the company from a reaming by fans.
[...]
There’s one major reason Microsoft is being perceived as a loser despite all the news it dropped in one of the longest press events of the E3: It’s got no games. Both Nintendo and Sony left fans freaking with announcements of major exclusive games coming soon, titles like the much anticipated Super Mario Odyssey and Xenoblade Saga 2 for Nintendo, and Spider-Man, Detroit, and a new Uncharted game from Sony.
Microsoft, meanwhile, had a new Forza car racing game and...actually that’s it. The majority of its “exclusives,” the games you buy a console for because it is the only place to experience the game, are either “Microsoft” exclusive, which means they can be played on a PC as well, or they’re “timed” exclusives, like 2015's Rise of the Tomb Raider. That means that for a short period of time the title will only be available for Xbox One. Later it will be available on Windows, PS4, and in rare cases, Nintendo Switch.
With its tiny, tiny bench of exclusive games to lure people in, Microsoft is going to need some other way of enticing consumers, and it needs it desperately. Last night Sony announced it has sold over 60.4 million PS4s to date. Nintendo hasn’t made it’s numbers available, but as it just went on sale in March, the estimated 2.74 million units sold is impressive. Microsoft hasn’t made it’s own numbers available either, but in January SuperData estimated the total consoles sold between its launch back in 2013 and January 2017 to be around 26 million.
Microsoft is losing.Yes, they certainly are.
To keep things in perspective, though, keep in mind that Microsoft are 500 billion U.S. dollars' worth, and then some, of global multinational corporation, and have so many irons in the fire that writing off their XBox division probably wouldn't be fatal for them. I mean, yes, games are big money, and losing the console contest to Sony and Nintendo will probably result a loss of revenue and jobs for Redmond, but the failure of the XBO-X won't be as big a deal for Microsoft as the failure of the Switch would've been for Nintendo, who are a tenth of Microsoft's size.
The bigger problem for Microsoft is that none of the other irons in the fire are heating up the way Redmond need them to. Windows 10, the lynch pin of the whole enterprise, is stalled at 26% market share when it clearly needs to reach 50% to have any chance of driving UWP development, and the Windows Store with it. Windows Phone is dead, killed by Android and iOS; Edge is mostly dead, with Chrome dominant in the browser space, and Google's Chromebooks are gaining ground with schools and businesses alike. Amazon is clobbering everybody in cloud storage and server services, and in the new home "smart speaker" market. The list goes on.
So, yes, Microsoft are losing the gaming console contest, but they're also losing all the other contests, apparently due to a lack of focus. The one area where they dominate, i.e. in desktop/laptop OS market share, is due mostly to Windows 7... a product that they're desperate to phase out as quickly as possible. Where, exactly, are they winning?
Microsoft's vision for the future is one in which Windows 10 forms the core of everything their customers do, on any device, in any environment, whether at work, or at play, or on the go, or at home. I'm far from convinced that "we're going to to be everything to everybody" is a viable business plan, though, and it looks like the cracks are really starting to show; XBO-X may be just the first of many dominoes to fall.