The gaming industry has been doing amazing numbers across the board, but not everyone in it is feeling that wealth. Many developers and game creatives have found themselves out of work at the whims of boardroom decisions. Even success isn’t necessarily a safety net, with plenty of big releases being followed by inglorious shutterings.
Microsoft CEO Satya Nadella isn’t the only exec with a skewed perspective on the importance of sales over the confidence of developers, but his recent comments on the subject highlight the disconnect between the company heads and the ones driving game development. It’s something that the industry as a whole has to reckon with, especially if they truly want to actually create something bold and new.
One of the things that has thrown gamers and developers for a loop in recent years has been Microsoft’s seeming willingness to cancel games and close studios with little warning. Even massive success stories like Tango Gameworks’ Hi-Fi Rush are undercut by the studio being casually shuttered. This strange dichotomy was firmly on display when Satya Nadella appeared on TBPN to discuss the state of the industry.
After a recent report from Bloomberg revealed that Microsoft executives have been expecting the Xbox division to achieve 30% profit margins — which is double the industry average — Nadella doubled down by saying, “the best way to innovate is to have good margins, because that’s the way you can fund.”
It seems like he wants to focus on innovation and creative game design, even speaking about the importance of creating new forms of “interactive media.” However, it’s hard to accept that straightforward pitch when Xbox isn’t supporting the developers who are working to do just that. In fact, Microsoft’s approach to game development leaves a lot to be desired, and it’s not because the games aren’t reaching their desired profit margins.
Microsoft’s biggest problem as a game publisher continues to be the way it demands amazing results but doesn’t give developers the necessary safety and confidence to commit to it. Hi-Fi Rush is a great example of this problem in a nutshell. Microsoft wants innovative approaches to gaming, something that Hi-Fi Rush had great success with. The fusion of platforming mechanics, counter-based combat, rhythm gaming, and story-driven gameplay was something the industry hadn’t seen before. It was a unicorn in the gaming world, a tightly designed product that resonated with critics and quickly found success with gamers.
It was, by all metrics, a massive success. Released through the Xbox Game Pass, the game earned millions of players in a short amount of time. Despite this, Tango Gameworks was shuttered, seemingly as part of an overall cost-saving measure amid leadership changes at Microsoft. It was far from the only studio to be closed, but the massive success of Hi-Fi Rush right before this happened makes it all the more confounding.
Especially when executives like Nadella are earning $96.5 million annually from their place in the executive suite while workers are being laid off despite succeeding, it feels inherently disingenuous to say that innovation is the key to success with Microsoft. If that was always the case, then Tango Gameworks wouldn’t have been closed by the company. In reality, the key to success is good products — and it’s hard to imagine many good ones coming out of the current business structure at the company.
Microsoft is far from the only company guilty of this approach to the industry. Several companies have been called out over the years for their own reliance on “crunch time” to ensure games hit the market for the lowest cost possible. However, Nadella’s comments highlight this problem in a way that’s very hard to ignore. Microsoft is now shifting gears from innovation towards broad sales, leading to former exclusives like Halo and Gears of War making their way onto competitor consoles like PlayStation.
According to his comments, though, Nadella wants the company to produce “the next console, the next PC gaming.” However, developers don’t get the time to make it under the kind of leadership Microsoft has been providing, and even success can be met with dismissal. It’s not surprising, then, that developers aren’t finding the current game development ecosystem to be conducive to proper design and innovation. Why push yourself to the brink only to have your studio closed and your position terminated? It’s not condusive to inovation.
If Microsoft is serious about remaining in the gaming space and and taking the lead in the industry, they need to give developers freedom from unrealistic expectations and ruthless business decisions. Just because a company technically made more money by closing a studio doesn’t make it a good call in the long run. It undermines the faith of consumers and developers alike. If Microsoft really wants to be a key part of gaming’s future, it needs to actually invest and trust in the people making the games instead of just demanding they do good work.
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