The video game industry appears to be facing a major shakeup. Microsoft reportedly made cuts to around 1,900 employees. Many of these employees were involved with the physical game release operations for their Xbox brand.
As noted via Jez Corden of Windows Central, he shared on social media platform X that Microsoft had “shut down departments dedicated to bringing Xbox games to physical retail.” He implies that this is tied to the company’s “digital-only Xbox console leaks,” which should give “an idea of where Microsoft is going here.”
Microsoft has also shut down departments dedicated to bringing Xbox games to physical retail … which if you’ve seen the digital-only Xbox console leaks … well, you can get an idea of where Microsoft is going here.
— Jez (@JezCorden) January 25, 2024
Additionally, video game industry analyst Daniel Ahmad replied to Corden’s tweets. He agreed with what appears to be happening for the future of Xbox and other such video game consoles:
“There are certain AAA games with 80 percent plus digital shares on Xbox these days so it’s not too surprising,” he writes. “Indicative of how next gen will be for sure.”
There are certain AAA games with 80%+ digital shares on Xbox these days so it’s not too surprising.
Indicative of how next gen will be for sure.
— Daniel Ahmad (@ZhugeEX) January 25, 2024
On the flip side, Corden does suggest that this doesn’t mean it’s an end for physical video game media. In fact, he adds in a follow-up tweet that “reducing retail teams doesn’t confirm Microsoft is quitting physical retail for Xbox games yet, they can outsource, and might be consolidating here,” he shares. “So, don’t run with ‘Xbox is quitting physical’ based on this.
“But, it does seem to be the industry trajectory. Writing is on the wall.”
Note: 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.
But, it does seem to be the industry trajectory. Writing is on…
— Jez (@JezCorden) January 25, 2024
As such, while this doesn’t seem to be a complete end for physical games released for Xbox, it does seem to be a general trend that the industry is expected to follow. It might take some time, but it does look like the industry is slowly stepping further away from physical media. Especially if leaks regarding digital-only consoles are true. Stay tuned to ScreenGeek for any additional updates regarding the future of Microsoft and Xbox as we have them.