ex[box]odus: leaving Babylon

Xbox has made the decision to pass over outgoing Xbox CEO Phil Spencer's presumptive heir Sarah Bond in favor of Asha Sharma - Microsoft's Core AI head who also held stints as Instacart's COO and as a Meta VP. It's a huge decision that has ramifications for one of the biggest tentpoles in gaming - the Xbox brand and what it stands for.

There has been some discussion of Sharma's gaming credentials - which is in part what I wanted to address today: the notion that you need to be a "gamer" to run a successful publisher/studio at Xbox's scale. (Spoiler: despite being a degenerate player I don't think it's needed). And in all candor, there's a non-zero chance Sharma has been given the job to quietly dial back spending and expectations and subsume Xbox within another business unit at MS. We don't know (yet) but likely we'll get indications soon enough.

On the need to be a "gamer" CEO:
The notion your boss needs to be some kind of gaming fiend to thrive in the C-suite is well past its use-by date however. A gaming background should be the icing on the cake: the capacity for mature governance and the ability to inspire teams with your vision for success is JUST as integral as your superior taste(tm) in interactive entertainment.

Having worked for "gamer" CEOs a big chunk of my working life - I feel it's easy overstate the value of your gamerscore or Steam backlog vs knowing how to:

- create realistic expectations of revenue
(and show how you get there) to stakeholders who control your purse strings

- understand your team creates cultural vehicles
building roots that endure for generations is a powerful pitch to top creatives

- inspire players with a confident (vs diffident) vision of the future
ensure they feel seen vs marketed to, that their voices can be heard vs placated, that transparency and authenticity matter

- listen to press, creators, partners
earnestly engage / contextualize internally vs disregarding critiques (accurate or not) because they emanate outside the org

- develop and set up for success a strong team
studio/publisher leadership who make time to mentor emerging talent shows investment in team success and vision beyond your tenure. Yes it takes time that you could be spending putting out fires. But the truth is in most orgs, there is always a fire if you go looking hard enough; it's better to empower your experts to be capable firefighters and hold them accountable vs being the One True Fixer.

I didn't need to ask Sharma's advice for the best prompts to give Copilot for this summary above because I've lived this reality at multiple stops. Like many of us, I've directly experienced the joy of working for CEOs who also fancy themselves creative directors, community leads, lead designers, producers, PR experts (my personal favorite) and every other imaginable title alongside their own. And while it's great to have a common chord with the boss, or being able to vibe with them because they too love Elden Ring or whatnot - I think just about every colleague I've worked for would sacrifice that for a smart businessperson who listened to their experts, gave them runway to do cool things to advance the studio, and kept things moving in the right direction.

Of course you need to be passionate about the medium. That doesn't mean you have to be 500 hours deep into Path of Exile 2 like vs understanding the power and potential of the medium and how to talk to all your audiences - something most CEOs in gaming are not great at (with some notable exceptions). You do need to be able to rally your stakeholders and leaders and build confidence in your informed vision. And your informed vision should be able to accurately represent the team's capabilities or show how you will get them there - vs finding a comfortable coterie of people who avoid speaking truth to power.

I'm sure other examples exist, but the only exception I've experienced in two decades of work in press, agency, publisher, and in-studio has been Steve Sinclair, CEO at Digital Extremes. [Disclosure: Steve likely had to sign off on letting me go from my job at DE last year so it's not like I have a reason to be a fan] - but it cannot be denied: he lives and breathes his games, cares deeply about community reception, and most importantly is constantly in the trenches with his experts actually fixing stuff.

Outside of indie publishing, that level of humility and commitment is rare. And when the AA or AAA (or AAAA) "gamer CEO" or "gamer C suiter" blurs role lines with craft because (words to the effect of) "I PLAY the game so I KNOW what the community wants" or (to paraphrase a past CEO) "I am the target market - I know what works"* - it is a flag from a decisionmaking and people development POV. Whether it's actual capital you're putting into that business as an investor, or your own sweat equity as a colleague/team member - it should be on your radar too.

On self inflicted wounds
Back to Phil Spencer: to my outsider's perspective he was a breath of fresh air in the top Xbox job. Gracious, professional, interested in what his constituency had to say, and successful...up until the quest to acquire Call of Duty Activision Blizzard. From announcement in Jan 2022 to completion of the deal finally in October 2023 - it must have been a soul-sapping journey for the entire Xbox and Activision Blizzard team. Role duplication resulting in mass layoffs, home office consolidation, and what had to be an exorbitant pricetag clearing regulators around the world (far more a lobbying effort than a process one) - that's a lot of effort only to still be compelled to ship Call of Duty on rival PlayStation.

As reality (and job cuts) kicked in, it was understandable to start seeing more "managed" comms from Phil - but when the team pretty much sent President/COO Sarah Bond to tank the fallout vs him, that was the signal things were going to change. You don't send a future CEO out in the wake of laying off thousands of workers if you want her to succeed - you send the current guy. Cutting bait with your architects of the present signals a desire to pursue a different future.

Annoying armchair comms quarterbacking begins here
It's going to be fascinating watching how Microsoft and Xbox's comms apparatus supports Sharma. On the basis of what we've seen so far, some thoughts from the peanut gallery:

- players don't need a new friend vs visionaries who further the medium
Playing defence on "gamer cred" just encourages more scrutiny, more half-ass purity tests, and more sleuthing about the past vs the future. Populating an account ala this was unnecessary, but understandable when the industry has lost approx 40K jobs in the past few years and people are looking for scapegoats.

Showing you care about the issues your audiences care about goes a lot further than your Vampire Survivors high score will, and as we have seen recently, there's always someone in the wings ready to dime you out of you're trying to fabricate that image anyway.

- be brutally candid as fast as comfort level and your scope allows
I appreciate brand identity - internally and externally - is a huge priority for Xbox and MS right now - but my lizard brain always moves to transparency in these situations as the curative.

Coming from the CoreAI team and worried people will get the wrong idea?
Once things settle down from the departure news, find someone trustworthy and explain the vision. Be bold and vulnerable - don't just find the glossiest masthead you can find. Bite the bullet and find a People Make Games-caliber outfit who will ask every possible tough question imaginable: from "wtf are your data centers doing" to "are you gonna kill Xbox?".

I imagine this prospect is terrifying and the natural insider's response is "you can tell [x] has never worked at [y] before - that's comms suicide for any org." Yeah - only because you've allowed that state and fear to persist. Set expectations up front on things that are Satya Nadella's paygrade that you can't answer - and encourage deeper questioning on the things that ARE in your purview. The inclination to go dark just hurts and disempowers an incoming CEO IMO, when they could be agents of change.

Show a willingness to engage vs be an observer as entire audiences get mobilized against you either through misinformation or lack of official dialogue. One of the worst trends of the past few years has been the notion you can selectively ignore critics or stonewall them with impunity, usually being propagated by counsel assuring leaders the way to handle reputational crises to not talk about it.

Continuing an entropic cycle of stilted information and comms benefits nobody except the timid, and Microsoft right now seems like the kind of place where timidity will kill you. If there ever was an opportunity to show a different way forward and break down barriers, it is going to be 2026. As my somewhat esteemed ex-colleague Matthew Manarino would say: nothing changes if nothing changes.

- egalitarianism
If Phil Spencer represented the era of Xbox leader who really gelled with specialist media and creators, learn from his successes and ensure you're arming your advocates, and giving useful context to your critics. But go a step further and devote time to genuinely moving among your communities.

No disrespect to Spencer - I'm sure he did too, but if the only time your constituents hear from you is when it's good news - and then through press outlets or content creators - you're living in the past.

Forging meaningful ties with the multitude of audiences and communities in the Xbox ecosystem alongside legitimate games press and creators - is a tough and huge task - but also a worthy one. Audiences care about being seen - and also are more inclined to give the benefit of the doubt to someone who is including them in their process vs speaking at a remove.

It might seem hokey but Spencer proved how disarming it is when a preeminent industry figure treats creators as peers vs vassals - carve out the time for the personal touch and it will buy you the runway to do great things...if your imagination and ambition is up to the task. |

If the remit is something more modest (like "shut the business down"), harness the wealth of passion, creativity and audience interest - and your mandate - to show your leadership group a different world than the one they have lived in and open their options up beyond "funnel money to OpenAI" and "try to forget Bill Gates".

(IMO)