Microsoft says Xbox has been losing the console wars since 2001

As Microsoft takes issue with the Federal Trade Commission (FTC) over its $69 billion acquisition of Activision Blizzard, the Xbox maker has admitted something everyone probably already knows: it lost the console wars.

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The “console wars” here refer to the constant bickering between manufacturers such as Nintendo, Sony, and Microsoft for market control and outsmarting their competitors in a particular generation of hardware. in Document presented at court hearing on June 22 by Microsoft (displayed by Kotaku), the company has discussed how it’s been losing console wars to Nintendo and Sony since it burst onto the scene in 2001 with the powerful original Xbox. She notes that both the GameCube and PlayStation 2 outperformed the first Xbox by “a large margin”. And as Microsoft mentioned in the document, that’s been the case since then – until now.

“Xbox has lost the console wars, and its competitors are positioned to continue dominating, including by leveraging exclusive content,” Microsoft wrote. The Xbox console ranked third (out of three) behind PlayStation and Nintendo in sales. In 2021, Xbox had a 16 percent share while Nintendo and PlayStation held shares. [redacted] And [redacted], respectively. Likewise for console revenue and the share of consoles currently in use by players (the “installed base”), Xbox tracks 21 percent while PlayStation and Nintendo have shares of [redacted] And [redacted]respectively.”

According to hardware and software sales tracker VGChartzMicrosoft’s latest consoles, the Xbox Series X and Xbox Series S, have it Only 21 million units have been sold As of April 2023. Meanwhile, the PlayStation 5 and Nintendo Switch are volatile at around 36 million units each, though the handheld hybrid console has a slight lead.

As a result, Microsoft said it essentially gave up on competing in the current console wars, instead choosing to focus on delivering software (that either didn’t show up or floundered) to its gamer base. We’ve seen this pivot through most of what Xbox has been doing nowadays, such as its heavy focus on fleshing out its Game Pass subscription service. Microsoft seems less interested in being number one in the market and more interested in becoming the industry’s first Netflix.

Having lost the console wars, Xbox is betting on a different strategy than Sony [and Nintendo]Microsoft wrote in the document. “Xbox generates revenue through game sales, not through console sales. This is because Xbox sells its consoles at a loss, effectively subsidizing players buying the hardware in hopes of making up [lost] Revenue through sales of games and accessories.

Kotaku Microsoft has reached out for comment.

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Such acceptance comes as Microsoft has also stated that it is anticipating the next generation of the console It begins in the year 2028. This would refer to it Call of duty It will still hit competing platforms if such a game is released if/when the company compiles Activision Blizzard. However, Sony isn’t too keen on the acquisition, Sony PlayStation president Jim Ryan admitted on the same hearing. It will not share information on the PlayStation 6 virtual machine with Call of dutyThe acquisition must be approved. Obviously, this can have all kinds of ramifications Call of duty PlayStation fans.