Veering a bit from the "TV, TV, TV" mantra set at E3 2013 and the Xbox course set by his predecessor, Microsoft CEO Satya Nadella appears to be taking a sudden turn in direction by shuttering Xbox Entertainment studios programming.
The programming division was launched to elevate the immersion of Xbox games by creating TV series that built on the lore of associated games, expanding story lines and exploring side plots. But Microsoft's Xbox division has returned its focus on games -- as requested by fans and indicated by its message at E3 2014 -- as Nadella continues searching for ways to make his company more "nimble" and responsive.
Xbox Chief Phil Spencer released a message via email, confirming the impending closure of XES and affirming that the Xbox division was on board with the company's new "cloud-first, mobile first" mantra.
"Change is never easy, but I believe the changes announced today help us better align with our long-term goals," stated Spencer. "We have an incredible opportunity ahead of us to define what the next generation of gaming looks like for the growing Xbox community."
Though the TV tie-in for the Xbox game Lococyle received lukewarm reviews from critics and gamers, as did the game itself, Spencer stated his belief in the Xbox' ability to provide entertainment beyond video games. The closure of XES will phase out a huge portion of the console's "TV" component, but Spencer stated that the strategy was still in play.
The shuttering of XES comes as Microsoft officially announced that it planned to layoff 18,000 employees over the next six to 12 months. After taking on roughly 30,000 employees in its acquisition of Nokia's handset operations, Microsoft said (registration/fee) approximately two-thirds of the job cuts would hit the teams behind its phones and tablets.
While Microsoft's companywide layoffs will forever change the lives of those affected, Daniel Ives, FBR Capital Markets analyst, said Nadella has to make prudent moves to steer the company away from the deleterious destination previous CEO Steve Ballmer had charted.
"Steve Ballmer threw a massive house party for a decade, and now Nadella is there the morning after, cleaning up," said Ives. "He's using this opportunity to clear the decks so they enter the next fiscal year in a position to put good money into the strategic areas they want to focus on."
