Xbox’s new CEO is making changes to Game Pass, exclusivity, even the name

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Asha Sharma is flipping the script. This week, the new and former CEO of Microsoft Gaming — I’ll explain that in a second — made it clear that there was no decision taken under the previous management that she wouldn’t consider reversing.

The big one was slashing the price of Game Pass after an unpopular — and, it would appear, unsuccessful — 50% price hike last year. This goodwill-generating move went hand-in-hand with something a little more hard-headed for the business crowd: Call of Duty games will no longer see day-one launches on Game Pass, so they can actually, you know, make money. The latter decision seems like such simple good sense it’s easy to gloss over what a colossal strategic U-turn it is, arguably flying in the face of the entire reason Microsoft spent $69.7 billion (and untold legal billable hours) on acquiring Activision Blizzard in the first place.

On a roll, Sharma then decided to rename her department. Microsoft Gaming, so named because it included but was not limited to the Xbox business, is no more. It’s just called Xbox, and she is the CEO of it. “We are Xbox,” she trumpeted in a letter to staff, co-signed by studios boss Matt Booty. This reads as either uplifting and community-spirited or sinisterly Borg-like, but the note itself seems clear-headed about the challenges ahead for Microsoft’s huge and wobbly games division. And the branding change makes sense, both as a symbolic unifier for the department and because Microsoft Gaming sounds so desperately uncool.

Sharma even promised to “reevaluate our approach to exclusivity, windowing, and AI,” showing a bracing willingness to touch every third-rail topic for the Xbox fanbase at once. An even partial reversal of Microsoft’s recent willingness to put its games on any and every rival console or storefront would be a huge deal, restoring faith in the future of Xbox as a platform, if not necessarily helping sales. Her talk of affordability, at a time when so few other gaming companies seem willing or able to tackle price inflation, is also striking.

Asha Sharma and Matt Booty talk to the Xbox staff.

But you have to wonder how far Sharma is willing to go to be liked — or, indeed, how far she’ll be allowed to go. She is in the honeymoon phase for a new leader when bosses encourage the new broom to make changes and put clear water between themselves and the unpopular decisions of their predecessor. Often, though, reality bites soon after — not least because most of those unpopular decisions were actually the result of mandates from above. Phil Spencer’s Xbox was driven into the arms of Steam, Sony, and Nintendo by profit targets imposed by Microsoft’s finance team, for example.

I wonder how much grace the bean counters will give Sharma before they start looking for receipts. And I wonder whether “We are Xbox” really means putting Microsoft’s own consoles back at the heart of what it does — or whether it’s actually just a subtly different version of “This is an Xbox,” the vague slogan that got Spencer’s team in all this trouble in the first place. Sharma’s rebranding puts all sorts of non-Xbox things like World of Warcraft and Candy Crush under the Xbox banner, and Sharma is still talking about cloud gaming and about Xbox as an “ecosystem” or amorphous platform which “reaches” 500 million players. That all sounds pretty familiar from the Spencer days.

For now, though, I choose to give Sharma and her team the benefit of the doubt. She seems to grasp the problems and have an idea of some of the solutions. (This is the first time I’ve heard an Xbox CEO use the words “Game Pass” and “sustainable economics” in one sentence, and it’s way overdue.) And, with a simple name change, she is pouring value back into the Xbox brand, reversing a decade of gradual diminishment.

The part of the note that gives me the most hope is when Sharma writes, “We have to be honest about where we are. We’re a challenger.” Microsoft has spent a long time excusing the fact that it’s way behind the competition in games by attempting to change the scope of the battlefield and the rules of engagement. But its best work was done in the original Xbox and Xbox 360 era, when despite the company’s vast resources, it was a hungry underdog. If Sharma can recapture that pugnacious, brash energy — synonymous with Xbox at its best — she’ll really be onto something.