Microsoft Corp. hired a longtime video-game industry analyst to help turn around its Xbox division.
On Wednesday, Xbox announced it appointed Matthew Ball to the position of chief strategy officer. Ball, the chief executive officer of research house Epyllion, is known for his in-depth studies of the metaverse and the games industry. In an interview after the announcement, Ball said his goal will be to return Xbox to its former glory.
The games group at Microsoft has long struggled to keep pace with Japanese console-making rivals Sony Group Corp. and Nintendo Co., and the company this year overhauled its leadership with the appointment of Asha Sharma as the new president. Sharma, who comes from Microsoft’s AI division, is also bringing on former Azure AI corporate vice president Scott van Vliet to serve as Xbox chief technology officer.
“The last few years have had a lot of different and largely disappointing quarters,” Ball said on Wednesday. “Our job is to turn around the business, to grow its reach in players and player hours.”
Microsoft has invested heavily in expanding the reach of its Xbox brand and services beyond its home console, but those efforts have not meaningfully improved the key metrics of player time and engagement. Its push of the Game Pass subscription service contributed to cannibalization of sales of the company’s marquee $70 games, according to former employees interviewed by Bloomberg. Sony’s PlayStation 5 still holds the crown for most popular home entertainment machine, while Nintendo’s Switch 2 has dominated sales charts since its debut last year.
Ball says his focus will be reviving storied franchises and strengthening Xbox’s console business, which is under pressure from surging component costs as AI data centers have triggered a spike in demand for memory. Still, he believes the console business is “important, durable and still growing.” If the company executes Sharma’s strategy successfully, “revenue will follow and profit should as well,” he said.
The new Xbox CSO is known for his research on the metaverse and user-generated content platforms like Roblox, a powerhouse in gaming that, according to his research, accounts for much of the recent growth in the industry outside China. Microsoft owns competitor Minecraft, one of the highest-grossing games of all time and a virtual world where players can make their own maps and items.
“I’m very focused on this question of how games can – where appropriate; it’s not suitable for all titles – find better and bigger ways to explore, create, co-create and build together,” Ball said. He isn’t yet sure whether Microsoft will decide to lean more into user-generated content.
Sharma aims for a “return of Xbox,” she wrote in a memo to employees obtained by Bloomberg News that also acknowledged that “players are frustrated.” For many, loyalty to one games platform over another is tied to the exclusive titles they can play only on that machine, and Microsoft’s previous strategy of distributing its top titles everywhere seemed to dilute that appeal. Ball declined to comment on whether Microsoft will follow Sony in making some blockbuster games exclusive to its console, but added that there are more options than the binary of exclusivity. Sharma has pledged a “renewed commitment” to the Xbox console, while delivering on an upcoming device codenamed Project Helix and also aiming to expand Xbox sales in emerging markets.
One of her goals is to “elevate creator-centric platforms like Minecraft, The Elder Scrolls, and Sea of Thieves,” Sharma said.
Ball’s job is to deliver on those promises. He previously held roles at Amazon.com Inc., where he was head of strategy and planning for Prime Video and Amazon Studios, and as a senior adviser at McKinsey & Co., according to his LinkedIn profile. In recent years, Ball has garnered attention for his exhaustive reports on the state of the games industry, which have spurred conversation among gamers and executives alike. His report this year aimed to explain why growth in the business has stalled.
“Video gaming has been losing the attention war for a half decade,” he wrote.
New video games are struggling as players stick with older titles they already love, or increasingly spend time watching short-form video on apps like TikTok. The same five evergreen games – each released more than nine years ago – have retained more than a third of player hours on Xbox and PlayStation, according to Ball’s report.
Ball said Sharma tapped him after several conversations about what Xbox’s top priorities should be. He says he has “thousands of memories in specific basements playing Halo, playing Gears of War, and when she asked if I wanted to be a part of a turnaround, it was irresistible.”