Jon Kimichi spent 16 years at Microsoft, witnessing the initial conceptualization phase of the Xbox brand, so his view that "Xbox cannot have it both ways" carries significant weight in the industry.
In a lengthy analysis published in the gaming industry media outlet GamesBeat, Kimichi clearly distinguished Microsoft's gaming business from the Xbox platform. His views largely echo those of former PlayStation head Shawn Layden, suggesting that Microsoft faces a core choice: should it invest resources in building a platform, giving players a compelling reason to buy an Xbox console, or should it maximize its operational efficiency as a publisher? Recent moves by Microsoft clearly lean toward the latter.
He explained: "The Xbox platform is a complete ecosystem connecting players and developers: consoles, Xbox mode, commercial systems, identity systems, ownership, community, development tools, and third-party support." He added, "It is quite possible that Microsoft's gaming business continues to grow while the Xbox platform shrinks."
The console, as the core pillar of Xbox—a position new CEO Asha Sharma has publicly committed to maintaining—has now become the focal point of contradiction. Kimichi revisited a classic Xbox slogan that had long been abandoned, stating that "'This is Xbox' was a very worthwhile direction for promotion," but like many of Microsoft's projects, it ultimately failed due to "timing and execution." It neither fulfilled "promises made externally" nor served "the product experience itself," resulting in this cross-platform campaign becoming "a joke staged by Microsoft itself."
Kimichi believes that a major reason for this situation is Xbox's long-standing fence-sitting strategy. The "Play Anywhere" promise inevitably expanded the user base—the more devices covered, the more potential players—but it did not become the "core reason users choose Xbox." Kimichi evaluated Phil Spencer's era strategy as resulting in a platform that was "all-encompassing yet featureless; for everyone, yet exclusive to no one."
Xbox has further expanded into PC and cloud domains but failed to dominate any single platform, let alone build and clearly define its own ecosystem barriers. Kimichi contrasted this "chaotic and disordered" approach with Valve's operation of Steam: "Meanwhile, Steam has always had one core goal: serving PC gamers. Xbox has never answered the two most critical questions: Which ecosystem layers must we firmly control? Which internal businesses need to be prioritized (and when)?"
Against this backdrop, Microsoft's next-generation console, the Xbox Helix project, will be a critical test, perhaps even the last chance. Without a console as an "iconic product" to anchor the entire ecosystem, the platform risks becoming merely "a collection of services that users can purchase piecemeal from other channels."
He recalled: "I was on the team when Xbox was founded. At that time, Microsoft's internal concern wasn't just that Sony would sell more consoles; we were more worried that another company would control the living room's operating system and commercial transaction layer. First-party games were the foundation of Xbox's establishment, not the ultimate goal."
Today, the Helix project, like the PS6, is struggling to survive in a hardware market squeezed by AI demands. In such an environment, a platform product with ambiguous positioning is practically sentenced to death, especially if Microsoft's new console is indeed heavily PC-oriented as rumored. The Helix project could ultimately cement and bury Xbox's platform identity: a console completely overshadowed by third parties within its own ecosystem, a path diametrically opposed to that of the Nintendo Switch 2.
We know Helix can run PC games, but as a console—a product players buy to connect to their living room TV—what is its core competitiveness? Kimichi's judgment is: "An Xbox that can only be used to launch Steam is essentially subsidizing Valve's cash register."
"If I were setting the strategy, I would choose the platform route," rather than simply being a publisher, he stated. The benefits of building a platform are enormous, although extremely difficult—setting industry rules, controlling sales channels, attracting developers, building user loyalty, gaining influence over other platforms, and more efficiently leveraging Microsoft's vast Azure cloud and PlayFab game service resources.
Kimichi explained: "Stabilize the console business and make it an industry benchmark, but don't confuse the positioning of platform and publisher. Upgrade the Xbox model to a unified Xbox OS running on Windows devices and third-party hardware. Let ecosystem ownership advantages and developer resources be the core reason users choose your brand. App stores, first-party games, Game Pass, cloud services, mobile—all businesses must serve this core promise. Of course, give fans something to look forward to as well."
"Microsoft must control a scarce core niche that players, developers, and hardware manufacturers recognize as valuable. If the PC store remains uncompetitive, if Play Anywhere remains a niche feature, and if the Xbox OS offers nothing that Steam and standard Windows systems don't already have, then the platform route is completely dead."
Unfortunately, taking the platform route requires delivering high-quality first-party games—one of Xbox's biggest shortcomings for years—and successfully streamlining and adjusting its vast and chaotic business structure.
Kimichi outlined expected goals for the next 12 to 24 months: "Microsoft should release third-party devices equipped with Xbox OS; increase the usage rate of Play Anywhere features and the PC store; smoothly integrate the transition from physical discs to digital versions into the Helix ecosystem; make substantial progress in the Minecraft creator economy; improve publishing efficiency for developers; clarify the relationship between Battle.net and the Xbox Store; and formulate an exclusive content strategy that lasts beyond a single financial reporting period."
He added that the most obvious signs of Xbox's failure to build a platform would include: Helix being priced high without a clear core selling point; the Xbox launcher "primarily" serving other stores like Steam; core IP assets being gradually hollowed out; and funds flowing back to Microsoft headquarters rather than being continuously invested in Xbox itself. (Coincidentally, Xbox's flagship IP Halo has just been transferred under Activision, and after Halo: Campaign Evolved launched on PC, Xbox, and PS5, the Halo studio was dissolved.)
Currently, Xbox is laying off thousands of employees while integrating, closing, or spinning off its studios. Kimichi believes that "the worst outcome would be verbally committing to being a platform while actually just engaging in asset-stripping business."