Xbox Series X Brand Strategy Assessment

11 Nov 2020 | Brand Spotlight

The Netflix of Video Games

Xbox Brand Strategy for the Xbox Series X

Article first published on 17th August 2020

A note on the article: The intention of the article is to provide a fair and balanced assessment of Xbox’s brand strategy. It’s important for us not to misrepresent or be unfair to the brands mentioned. Before the article was published, we contacted representatives of both Microsoft and Xbox to give them the opportunity to comment or provide feedback if they felt like any information was omitted or mischaracterised. We received a warm response from the representatives of Xbox who had no issues with the article, but expectedly confirmed that they had no comment or clarification to add.

This article will be updated as new information emerges that affects Xbox’s brand strategy as it relates to the Series X and Game Pass.

Helpful Definitions & Context

  • Xbox – The gaming brand owned by Microsoft.
  • PlayStation – The gaming brand owned by Sony under it’s Sony Interactive Entertainment (SIE) division.
  • Generation – In the video game industry lasts around 6-8 years, characterised by the release of a new numbered console: PlayStation 1, 2, 3, 4, 5 / Xbox, Xbox 360, Xbox One, and Xbox Series X.
  • Console editions – Typically, console manufacturers release product editions like phone companies (e.g. Xbox 360: Standard, Slim, Pro, and Elite). Manufacturers release alternative colours, hardware specifications, and limited editions of their new device. Unlike new phones, these products have a staggered announcement and release over the generation. They are not a new numbered entry but a premium upgrade option.
  • First-party – These are game development studios owned by a console manufacturer (e.g. Xbox). They produce first-party games / titles exclusively for their owner’s platform.

Overview Of Xbox Brand Strategy for the Series X and Series S

This past generation for Microsoft and Xbox has been a tale of two halves. An example of how valuable and fragile your brand is, how easily it can be damaged with the wrong strategy, and how much hard work you need to put in to restore it. It’s also a perfect case study of how a brand can rebuild and position themselves for the future.

Differentiation is the cornerstone of any compelling brand. In the video game industry this is looking more important than ever for the coming console generation. Sony currently dominates the market with the PlayStation 4 so with the Xbox Series X Microsoft needed to shift strategy. Their approach is very bold, filled with both opportunity and risk. Microsoft is positioning Xbox as a broader gaming platform and expanding the brand’s presence in the PC and mobile market.

Xbox’s Next-Generation Focus

The core of this strategy is Game Pass, a Netflix style service which Xbox is hoping will appeal to a wider audience and increase their userbase. Despite the upcoming release of the Xbox Series X, Game Pass looks like Microsoft’s real focus, with the company leveraging their IP to promote their service rather than their new console. The success of this strategy is difficult to assess. In terms of raw console sales, Sony is likely to remain dominant. However, this might not be a concern for Xbox if they can make substantial gains in other areas.

The long-term future of Game Pass will be battled out on PC. Positive press and good marketing around Xbox’s new service has generated interest from consumers. Microsoft will need to capitalise on this to build momentum while Sony focusses on their console launch. Future efforts from Sony, as well as interest from third-parties, threatens to fragment the market and risks placing Xbox in a diminished position on both console and PC. If Microsoft can roll out their full service efficiently, they could enjoy several years of dominance in this area and have a strong position to defend themselves against competing services. Xbox could also break new ground in the mobile market and even make new gains in the console space with the release of the Xbox Series S offering consumers a lower priced entry into the next generation.

Microsoft looks like they’re focussing on giving consumers a different option this generation. Xbox is hoping their long-term approach could eventually see them emerge as the leading service provider for video games with a share of the market across PC, console, and mobile. We will be eagerly watching over the next 5 years to see how Xbox’s brand strategy fares as the market develops.

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Introduction

For the first part of our video game branding series we are taking a closer look at Microsoft’s Xbox brand strategy as they prepare to launch their new Xbox Series X console. Of course, Microsoft will be keeping their brand strategy as close to their chest as possible. This is our assessment based on everything we know and have observed from Xbox over the past 8 years. It goes without saying that Microsoft has been hugely influential in the video game space. Since the launch of the Xbox brand almost 20 years ago, their rivalry with Sony has helped shape the industry into what it is today. Before we look forward though, let’s quickly reflect on this past generation for Xbox so we can better understand their thinking moving onto the Xbox Series X.

Xbox Brand Strategy E3 2015

A Look Back At Xbox One

Losing Focus With TV And Movies

Microsoft have been trying to broaden the appeal of Xbox. This past generation with the release of the Xbox One, saw the manufacturer falter in their vision to create an all-in-one entertainment hub. Xbox lost focus on their brand. They caused confusion with an overemphasis on TV and movie services rather than directly target their core gaming audience. This alongside continuous negative press, a high price point for their launch console bundle, and a slew of marketing mishaps left their rival Sony firmly in the driving seat. PlayStation 4’s competitive price tag and simple message targeting gamers saw them build an early lead. Xbox scrambled to reposition themselves dropping the price of their device with a cheaper bundle option and refocussing on games. In the meantime, PlayStation surged ahead, generating unstoppable momentum that left Xbox resigned to second place.

All About The Games

Changes needed to be made. Microsoft appointed Phil Spencer as the new head of Xbox and with him came a new approach. Xbox needed to repair their brand, regain the goodwill of the consumer, and build for the future.

Their first step was to refocus their message back onto games and gamers. One of the earliest demonstrations of this realignment was their efforts to implement backwards compatibility that allowed old games to be played on their Xbox One console. The release of a new Xbox One “Pro” edition saw Xbox boast of the most powerful gaming console ever made. It was a firm repositioning of their brand and recommitment to the gaming market. Microsoft also rekindled their interest in PC gaming, releasing an Xbox storefront on PC and finally bringing their first-party IP to Windows. Overall, Xbox’s brand strategy became very pro-consumer. Following on from backwards compatibility, Microsoft championed cross-platform play; the idea of gamers playing together regardless of platform, whether on Xbox, PC, Nintendo, or PS4.

A Lightbulb Moment

Cross-platform play is a particularly important strategic moment for Xbox. With this one idea Microsoft achieved three things. Firstly, it was the final step in restoring the Xbox brand in the eyes of the consumer and repairing all the damage that had been done. Secondly, it put pressure on their rivals Sony and weakened their stranglehold on the market. Finally, it allowed Xbox to build a new strategy for the upcoming generation.

Console ecosystems have been traditionally very isolated from each other. A deciding factor in the purchasing decision for many consumers is which device is more popular in their social circles. With so many PS4s sold this was a growing barrier for Xbox. Both Microsoft and Sony knew this and so began a friendly public sparring match. Microsoft championed the idea and promoted their own cross-play between Xbox One and Windows. A few independent games demonstrated that cross-play was technically possible between the consoles. This ignited consumer interest. Nintendo even joined in. Eventually some games were announced with cross-play enabled between Xbox, Windows, and Nintendo. The mounting public pressure on PlayStation to join in eventually led to Sony conceding. It wasn’t a major loss for Sony, but it was a major win for Xbox and for consumers.

The breakdown of these artificial barriers between devices spawned a new trend in gaming. It’s now increasingly common for new games to support cross-play. It’s here that Xbox found a new brand position that is to play a major role in the strategy of their next-generation console, the Xbox Series X.

Xbox Brand Strategy - Xbox Series X Announcement

Looking Forward To The Xbox Series X

A Platform Approach

When a company can differentiate itself and align with a growing trend it can create a compelling brand. This is vital for Xbox this generation. These trends include ‘games as a service’, the transition towards digital rather than physical games, and streaming. Each of the big three console manufacturers, Microsoft, Sony, and Nintendo are all differentiating themselves. For Nintendo, the success of the Switch will no doubt see them double down on the handheld market, continuing to offer consumers gaming on the go. With the PlayStation 5, Sony are focussing on creating a true generational leap in gaming through hardware innovation, creating new possibilities for games on their device. While Microsoft are also releasing a next-generation console, the central focus of their brand strategy is all about Xbox as a platform. With the release of the Xbox Series X they have a clear message, “Play Anywhere”.

For the past 5 years or so, Microsoft has been slowing repositioning their Xbox brand. They’ve moved away from traditional hardware and towards a platform where gamers can go to play the games they love. Much in the same way that Netflix allows you to watch the shows you love. Their rekindled interested in the PC market, Xbox Game Pass service, first-party game strategy, and upcoming streaming focus, all align their brand with this vision.

Xbox Game Pass

Xbox is eying up a digital future focussed on video games as a service. Their most prominent marketing over the past couple of years has been to advertise the exciting prospect of their Xbox Game Pass which positions Xbox to deliver a Netflix style experience in the gaming space. The service launched in 2017 and is still being slowly rolled. With each evolution Microsoft is generating more momentum. In an interview in July this year, Xbox marketing boss Alan Greenberg stated that Game Pass is not meant to be profitable in the short-term but is part of a long-term strategy for the company. Microsoft also announced that Game Pass had accrued over 10 million users, showing that they are already operating successfully.

Xbox Game Pass currently offers over 100 titles starting from £7.99 per month for its base package on either PC or console. The Ultimate tier grants you Game Pass on both platforms along with additional perks for only £10.99 per month. Currently the service acts much like Netflix and other media streaming platforms in the tv and movie space, allowing users to access any game in the Game Pass library for as long as they remain subscribed. The big draw for Game Pass is the quality of its library, containing a lot of newer titles, along with day-one releases of first-party games.

At present Game Pass users can download games to their Xbox or PC systems. The ability to stream games is currently in beta on Android mobile devices but Microsoft intends to add cloud streaming to consoles and PC in the future. Over time this service has the potential to see players able to stream games to their console, PC, tablet, or phone, and switch between devices at will. Microsoft is building for the future this generation and Xbox hopes to solidify themselves as the leading provider by the end of this coming console cycle.

Game Pass Competitors

Xbox is also not the first mainstream games publisher to offer a service like this. PlayStation was incredibly early to market releasing PS Now back in 2014. The service launched at an eye watering price point and niche appeal. Nevertheless, Sony continues to support and develop PS Now. With the service also available on PC and reducing its price, it’s comparable to Game Pass. However, the general perception of PS Now is that it’s a platform for legacy titles. While PS Now allows you to play games from previous generations, it’s slow to add new releases. You also won’t find all of PlayStation’s big exclusive games on there, let alone at launch. In terms of mainstream awareness, PS Now has been relatively dormant. By contrast there seems to be growing excitement around Game Pass and this is clearly the core of Xbox’s brand strategy for the coming generation.

We should also mention that Google has dipped their toes into these waters. In the past year, the company released Stadia. However, without the infrastructure, user base, and gaming pedigree Microsoft has spent the last two decades cultivating, Google’s current trajectory is looking bleak unless they can successfully reposition.

Xbox Brand Strategy for first party titles - Halo Infinite

First-Party Strategy

Unlike Sony, you won’t need the new Xbox to play exclusive titles at launch. In fact, you don’t need a console at all. Microsoft confirmed that all first-party Xbox games will be releasing on both PC and console at launch. Microsoft also announced that they will continue to support their previous Xbox One consoles with their latest releases. This makes their games cross-generational for the first couple of years which is very unusual for first-party titles after the launch of a new generation console.

Sony is leveraging its first-party studios to sell consoles by locking new games to its upcoming PlayStation 5. In contrast, Microsoft’s strategy leverages its IP to promote Xbox as a platform, opening its games up to multiple devices and through Game Pass. As a flagbearer for the Xbox brand, the release of their latest Halo will see their mascot on Xbox One, PC, and the new Xbox Series X, setting the tone for a new platform-based strategy.

Unfortunately, so far messaging around Xbox’s cross-generational support has been somewhat messy. Not too surprisingly when you think about it, it’s a tricky proposition to sell. As a positive you are telling consumers they aren’t going to be pressured into upgrading and they will be supported at least in the short-term. At the same time, you are also disincentivising them from purchasing your newly released product. The most recent clarification came from Xbox marketing boss Aaron Greenberg on Twitter. He stated that all first-party titles will be developed for the new Xbox Series X first, and that their studios will decide whether to release those games on the Xbox One. While this still doesn’t provide a definitive message around cross-generational support, it does give Microsoft the flexibility to shift their strategy if data shows they need to.

Xbox Brand Strategy Assessment Xbox Series S

Xbox Series S

Prediction Updated (11-Nov-2020)

Rumours circulated for a while about an Xbox Series S edition after the announcement and reveal of the Series X, apparently a much less powerful console than Xbox’s flagship device. Speculation was rife as to the nature and purpose of this second machine. The announcement of this new device came in early September, about a month after this article was written. Back in August, this was our interpretation of what the console might be:

What we said in August:

“On the face of it the idea of an underpowered device doesn’t seem all that exciting. However, Microsoft could try to position the Series S as a streaming box, equivalent to Google Stadia. This would tie nicely into Xbox’s brand strategy. It would incentivise the adoption of Game Pass and offer consumers a very aggressively priced entry to the next generation. If Microsoft were to undercut PlayStation 5 with the release of a much cheaper device like this, it would be a compelling proposition. We expected to see an announcement of this console alongside the Xbox Series X but that never materialised. With the launch of streaming on Game Pass later this year tied to the Ultimate tier and limited to mobile, we might have to wait until Microsoft is ready to make streaming a standard feature of its Game Pass on console before we see a Series S from Xbox”.

So how close were we to getting this right?

Well, mixed to be honest. Hear us out. Firstly, the Xbox Series S isn’t just a streaming device, it functions like a standard console and that’s clearly been the intention and plan from Xbox well in advance. It’s more powerful than the previous generation machines but it is significantly less powerful than both the PS5 and Series X. Let’s compare the Series S to the Series X for a moment. The Series S has half the internal storage, a third of the processing power, 1440p resolution instead of 4K, and comes without a disk drive. That’s a very paired back device. Our gut feeling tells us that releasing the Series S in this way wasn’t supposed to be the plan.

We have to consider the motivation from Xbox to reveal the Series S. The Series X was revealed back in December 2019 and while rumours of the Series S existed, no second device was ever announced. The PlayStation 5 console was only revealed in the middle of June 2020 with the surprise announcement of a second device from Sony, a PS5 Digital Edition that comes without a disk drive, clearly aimed at lowering the barrier to entry for the next generation and encouraging the adoption of digital games. It was highly likely that Sony would match the Series X on price and use the cheaper PS5 Digital Edition to undercut their competitor, which is exactly what happened. Microsoft having seen this would know they’d have to counter to avoid losing their market share. The Series S was revealed in early September, undercutting the price of the PS5 Digital Edition before Sony even announced it. For reference the PS5 and Series X are retailing for £449, the PS5 Digital Edition for £349, and the Series S for £249.

It could have been Microsoft’s strategy all along to use the Series S in this way. Whether that was their preferred intention or their backup in case Sony surprised them, I guess we can only speculate. The only thing we can say is that revealing the Series S alongside game streaming would have been a far more compelling position for the Xbox Series S, offering consumers an affordable future focus device that can fall back to being a traditional console. Since game streaming for consoles and PC wasn’t ready, and with pressure from Sony, Microsoft probably didn’t have a choice but to release the Series S whether it was their initial intention or not. With Series S simply being the cheapest entry point for next generation gaming, it will be interesting to see how well the device sells without game streaming as a marketable feature. That feature is coming though and with it we imagine Microsoft would look to bolster the appeal of the Series S.

Xbox Brand Strategy Risk and Rewards Series X

Pricing The New Consoles

Prediction Updated (11-Nov-2020)

When writing this article, neither Sony nor Microsoft had announced any prices for their consoles and the Series S hadn’t yet been revealed, but we knew both manufacturers would be extremely competitive in this area. Both companies would sell their consoles at a loss if it guaranteed them a stronger position. Software and subscription services are far more valuable than hardware sales for both companies and early adoption of their consoles are more profitable in the long-term. Sony tends to take a reactive approach to the marketing and pricing of their consoles which gives them the opportunity to outmanoeuvre their rivals. We expected Microsoft would be forced to announce their price first and they were. We also expected Sony would match their standard PlayStation 5 to whatever price Xbox revealed using their PS5 Digital Edition console to undercut Xbox, and that’s exactly what happened.

What we said in August:

“A high price for both consoles would favour Xbox. Their platform strategy would likely increase the adoption of their Game Pass service while Sony struggles with the sales of its new device. However, Sony is not likely to allow this to happen. In fact, PlayStation seems ready to use the PS5 Digital Edition to undercut any price Xbox announces. This will likely keep the price of the Series X down. Microsoft simply can’t afford to give their rival too big a lead that would diminish their market share. With two versions of PlayStation 5 releasing, it’s Sony that has the tactical advantage in this area. Microsoft will need to think carefully about how to maximise the value proposition of their flagship device to counter this strategy from Sony. Despite all the speculation, we expect to see the Xbox Series X and the standard PlayStation 5 released at the same price. It’s likely both would try to release close to the £349 price point that proved so successful for the last generation consoles. However, with a higher price expected, we could see a £399 RRP from both manufacturers. Sony will more than likely retail their Digital Edition between £50 and £100 cheaper than their standard PlayStation 5, allowing them to undercut Xbox. If an Xbox Series S console were to make an appearance, Microsoft would use it to undercut PlayStation by a similar amount. If the Series S is a streaming device, then this provides an alternative proposition for consumers”.

So how close were we to getting this right?

Pretty close we thought, although we were slightly optimistic on the price of the standard consoles. Sony used their PS5 Digital Edition to meet the £349 price point that proved so successful for them last generation and they matched their standard PS5 to the Xbox Series X at £449. The reveal and release of the Series S by Microsoft undercut Sony at £249 but whether the cost of the Series S is enough to offset the hardware difference between Xbox’s second console and the PS5 Digital Edition only time will tell. However an interesting development that we certainly didn’t expect to see was Microsoft’s announcement that their consoles would be available to purchase as part of a 24 monthly payment plan which included Game Pass Ultimate giving access to the Series X and Series S consoles at £28.99/month and £20.99/month respectively. A masterful pricing strategy and compelling proposition for consumers, one we’ve been surprised Sony has not attempted to emulate in some form.

Potential Risks

A Reason To Buy

First-party games are major ambassadors for the consoles and generate press coverage and adoption of their platforms. Unfortunately, Microsoft simply doesn’t have the pedigree of first-party studios that PlayStation can boast and with the delay of Xbox’s flagship IP, Halo Infinite, their launch line-up is severely lacking. This will affect the adoption of their latest console and likely be a factor in the long-term success of its Game Pass service. Whilst Microsoft has made some impressive studio acquisitions in recent years, Xbox exclusive titles haven’t historically had the critical and commercial success that PlayStation’s have had, and this has been very clearly established in the public’s perception. Microsoft’s new acquisitions will need to build a reputation under Xbox for producing some of the best games in the industry, a reputation they will need to battle extremely hard with PlayStation to acquire.

In September, this year Microsoft announced the monumental acquisition of blockbuster games publisher Bethesda for $7.5bn. Bethesda brings with them a large catalogue of successful IP with mainstream recognition. Their reputation among the core gaming audience might have become tarnished in recent years, but their pedigree is undeniable, and the announcement certainly drew a lot of attention. Unfortunately, Bethesda has no major games releasing anytime soon, and those that are announced are likely several years away. So, at present it simply bolsters Xbox’s Game Pass library and serves as a statement of intent from Microsoft, one that might be a deciding factor for a small diehard community of Bethesda’s games but without new announcements it’s influence is limited.

As a downside of Xbox’s long-term strategy, their console sales might continue to suffer in the wake of PlayStation’s dominance. Without a compelling reason to upgrade to the Xbox Series X, adoption of their new system could be slow. For PC gamers, there simply isn’t any real reason to buy the new Xbox and console gamers might be content with using their old Xbox consoles or opt for the PlayStation 5 if they want to upgrade. New users on PC could help Microsoft could make up a shortfall. However, sales of their console will be scrutinised and compared to the PlayStation 5 and negative press in this area might affect adoption of their platform unless Xbox can focus coverage on their Game Pass performance.

Infrastructure For Streaming

For Game Pass itself there are also infrastructure complications. For the growth of this platform, streaming is key. While hardware may no longer be a barrier, a much higher level of infrastructure is needed than typical TV or movie streaming. This will require a certain level of internet connection that might not be possible in some regions, not to mention coverage issues and data caps. In the short-term, it is likely that a download format will be the go-to preference for most users. Hardware will still be a requirement so the Xbox Series X and Series S will need to sell well for Microsoft to maintain their console userbase.

Market Fragmentation

Finally, there’s the possibility of market fragmentation. When we look at the streaming market, companies like Disney have opted to pull their IP and create their own platforms. We’ve also seen this in the PC gaming space. Steam was the go-to storefront and while it remains the market leader, several big publishers including EA and Ubisoft have launched their own services which is now the only place on PC where you can access their games. Part of the success of Xbox then will depend on the deals they make with third-party publishers to get them on Game Pass and prevent them from competing for users on PC. There’s also Sony’s rival service to consider. PS Now has the potential to be a major threat to Xbox’s strategy. So far, Sony don’t seem to be focusing too much on this aspect of their business, but they won’t remain dormant for long.

Potential Opportunities

Partnership Agreements

Microsoft and Sony agreed a partnership deal back in May 2019 which would see them work together on new technology. Part of that deal will see Sony using Microsoft’s streaming technology for its services although the specifics of that arrangement are unclear. Even though Xbox is locked out of the PlayStation ecosystem, this licencing agreement with Sony will likely see Microsoft benefit from PS Now’s future success despite the competition.

Focus On Game Pass

Xbox Game Pass is well positioned to become the go-to service provider on PC. Xbox already has the advantage over PlayStation in supporting the platform with new releases. PlayStation are only just starting to release some of their exclusive games on PC, but they remain relatively hesitant. Their games have been system sellers for their consoles, and with Sony’s focus firmly on console sales, they might not be quick to change their approach. PS Now requires a concerted effort from Sony to match Game Pass if they are to compete with Xbox outside of the console market. This gives Microsoft an opportunity to build up a sizeable advantage while Sony’s attention is focussed elsewhere. In that position Microsoft could leverage deals with third-parties to bolster their library and increase the appeal of Game Pass.

At the end of September Microsoft announced that, in a deal with games mega publisher EA, all Xbox Game Pass Ultimate subscribers would also have access to EA’s own service, EA Play, for no additional cost. A massive win for Xbox Game Pass. EA’s catalogue of huge mainstream and annual sports titles added as part of Game Pass is an incredibly good deal and only bolsters the value of Xbox’s subscription service. Incorporating a competitor into their service Microsoft has already significantly strengthen their position in this space.

Creating A Platform

Once Game Pass has fully launched streaming as standard, we could start to see Microsoft roll out Game Pass to more devices. The barrier of entry to the Xbox platform would be lower and this would encourage consumers to try out their service. Their universal platform approach could see them broaden their audience with their app appearing on mobile devices, TVs, and other consoles. Their positive relationship with Nintendo provides an opportunity to get Game Pass onto the Nintendo Switch and open their service to the handheld market. This will depend on Nintendo’s own plans, but we can certainly see opportunities for Xbox here. With the full launch of game streaming we could see a new effort to reposition the Series S as a streaming hub, making a stronger case for the Series S over Sony’s traditional experience, and potentially making new gains in the console market.
Xbox Series X Brand Strategy Assessment

Xbox Brand Strategy Assessment

Concluding Thoughts

Xbox has firmly regained its position as a brand for gamers with several popular pro-consumer moves. Running parallel to this has been a repositioning of their brand away from hardware and towards a platform. Xbox’s brand message “Play Anywhere” represents their focus on a future where their service is accessible to anyone regardless of device. This differentiation of the Xbox brand from PlayStation’s is a bold but masterful decision. During this past generation, direct comparisons between the two have not always been favourable to Microsoft.

With Sony focussing on a generational console experience, this opens the door for Xbox to offer something different. To maintain their position among the top two console manufacturers, Microsoft will still need to compete with Sony for raw units sold. To do this they will release their flagship Xbox Series X, opting for raw power and next-generation performance as a statement of intent. Microsoft hopes that their positioning of the Series S might help them to expand their market share by competing with Sony for early adopters and offering a more accessible entry point to the next generation of gaming.

While they’ll attempt to remain competitive in this hardware space, it’s likely that Game Pass will be their focus. With this service, Microsoft is looking to broaden its potential audience and expand its presence in the PC and mobile markets. With the addition of streaming, Xbox hopes to eliminate the hardware barrier and offer consumers the ability to play the latest and best games regardless of device. With the recent acquisition of Bethesda and partnership with EA Play, Xbox is hoping their bolstered library of blockbuster IP can drive consumers to try out its Game Pass service and solidify them as the gaming platform of choice.

Digital was a growing trend last generation and will certainly be even more prevalent in this one. Game Pass will be Microsoft’s primary outlet to offer gamers a digital-only experience, with streaming building towards a service-led future. With Xbox breaking down hardware barriers, Game Pass will be open to a broader audience. Along with its early presence on mobile, we could see access to its service emerging on TVs and handheld devices in the near future.

Xbox’s brand strategy is full of potential but not without major risks. Their success will heavily depend on the adoption of their service, how other companies compete in this space, the deals they can continue to make, and the quality of first-party titles they release. How well the company will be positioned at the end of this coming generation will depend on how Microsoft takes advantage of the opportunities presented to them and how they can mitigate against future threats. Even though Xbox are off to a great start with their service, we can’t predict a clear outcome. By the end of this cycle, Xbox could be the Netflix of video games or they could see their rivals eat away at their market share. Only time will tell what the future holds for the Xbox brand.

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