In Beginning Shift To All Digital Future, Microsoft Reportedly Makes Massive Cuts To Xbox Physical Game Release Operations
In a disheartening sign that the industry has no intention of scaling back their anti-consumer practices, Microsoft’s recent round of video game-related layoffs have reportedly resulted in the complete closure of the Xbox divisions responsible for producing physical retail copies of their various releases.
RELATED: Microsoft Slashes Video Game Division, Cuts 1,900 Across Activision Blizzard, Xbox, And ZeniMax
Word of this operation shutdown was first broken to the public on January 25th courtesy of Windows Central Managing Editor Jez Corden.
Taking to his personal Twitter account in the wake of the aforementioned job cuts – which affected roughly 1,900 employees across Activision Blizzard King, Xbox, and Zenimax – Corden relayed that not only had “multiple sources” informed him “that Microsoft is laying off the entire internal customer support team(s) for [Activision Blizzard King] games, save a few” and “outsourc[ing] the rest to external companies abroad”, but that they had also confirmed the company’s plans to “shut down departments dedicated to bringing Xbox games to physical retail.”
While his sources did not appear to provide him with any outright explanation as to the reasoning behind this latter move, Corden noted himself, “If you’ve seen the digital-only Xbox console leaks … well, you can get an idea of where Microsoft is going here.”
Per marketing documents accidentally revealed by Microsoft’s lawyers amidst the company’s legal battle with the Federal Trade Commission regarding their then-desired-and-eventually-successful purchase of Activision Blizzard King, this year will see Microsoft release a mid-generation ‘refresh’ for their Xbox Series X which, in addition to a such changes as a bigger stock harddrive, reduced power usage capabilities, and a new cylindrical design will also drop the model’s currently-included disk drive.
As such, upon the successful phasing out of the base model at retailers in favor of this refreshed one, the Xbox ecosystem will be left with no supported version of the console capable of playing games from a physical disk.
However, after some took his reporting to indicate that the era of physical Xbox game releases had come to a complete end, Corden later offered the staunch clarification that “reducing retail teams doesn’t confirm Microsoft is quitting physical retail for Xbox games yet, they can outsource, and might be consolidating here. So, don’t run with ‘Xbox is quitting physical’ based on this.”
Yet, despite this call for patience, the Windows Central editor ultimately closed out his scoop by admitting, “But, it does seem to be the industry trajectory. Writing is on the wall.”
As previously reported, Microsoft first announced that they would be undertaking this latest round of layoffs via a January 25th internal memo sent to the affected teams.
“It’s been a little over three months since the Activision, Blizzard, and King teams joined Microsoft,” said Spencer, per a copy of the memo obtained by The Verge. “As we move forward in 2024, the leadership of Microsoft Gaming and Activision Blizzard is committed to aligning on a strategy and an execution plan with a sustainable cost structure that will support the whole of our growing business. Together, we’ve set priorities, identified areas of overlap, and ensured that we’re all aligned on the best opportunities for growth.”
“Looking ahead, we’ll continue to invest in areas that will grow our business and support our strategy of bringing more games to more players around the world,” he added. “Although this is a difficult moment for our team, I’m as confident as ever in your ability to create and nurture the games, stories and worlds that bring players together.”
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