Phil Spencer Shares Why Microsoft Won’t Use Xbox One Sales Anymore to Gauge Success, but Active Users

on March 1, 2016 9:02 AM

During Microsoft’s Xbox Spring Showcase in San Francisco, that DualShockers attended, Xbox Division head honco Phil Spencer gave a detailed explanation on the reason why the company won’t use console sales anymore to gauge its success in gaming, but will instead share monthly active users (MAO).

“The next thing I want to talk about is how we’re gauging our success, because there has been a little bit of dialog on this as well. Back in the fall, we pivoted how we talk about our Xbox success. We’ve been talking about monthly active users […].

Let me talk a bit about why I feel that is the critical point for us in thinking about success. People ask me: “does this have anything to do with how Xbox One is doing relatively to PlayStation 4 lately, is that why you’ve gone to monthly active users?” And the answer is no.

The fundamental answer why on monthly active users, the number of people that in the last 30 days have engaged with an Xbox Live game on Xbox One, Windows, or Xbox 360, is the critical factor for our team to gauge our success, is that that’s what our partners want.

Our partners in games, they want the largest collection of active gamers who will buy and play games. That is the ultimate metric in any service that you gotta talk about. What’s the monthly active userbase.

It’s not how many consoles I sell. If I sold a console two years ago and now it’s in the closet collecting dust, that’s not good for the gamers, that’s not good for the developers, and frankly, it’s not good for Microsoft.

The other risk with us taking on MAO as our key engagement metric and frankly success metric for us in gaming, is that it can go down. The nice thing about us selling consoles is that you never really have a negative month in selling consoles. Your console installed base almost always goes up. But that’s not really a reflection of how healthy your ecosystem is.

We focus on monthly active users because we know that those are gamers that are making a conscious choice to play our content, our games, our platform, our service, to go play games, and we want to gauge our success on how happy and engaged those costumers are.

It means we need to keep them happy. So we have some Live issues like we had in the last week, and that’s not great for our MAO count […]. We go a long stretch without great games on our platform? That will negatively impact MAO.

It’s great that we’re seeing more engaged gamers on Xbox that we’ve ever had. We are incredibly proud of that, but we know we have a lot more work to do.

So we picked this metric not to hide something, but I think we’re more exposed, by picking a number that actually shows how many people are really using our platform, using our service every month, and reporting that publicly.

But we did that because we do think that for you, the press, for the gaming developing community who wants to know how many people they get to by building these games, and to the gamers themselves, that how many people we have playing our console, is the fundamental point of how we’re doing. This is the metruc that we all should be looking at.”

It’s certainly going to be interesting to see if Microsoft will manage to keep its monthly active users count up over the coming months. Frankly, I like to play games, not sales, so that’s pretty much what I want to hear the most about.

 /  Executive News Editor
Hailing from sunny (not as much as people think) Italy and long standing gamer since the age of Mattel Intellivision and Sinclair ZX Spectrum. Definitely a multi-platform gamer, he still holds the old dear PC nearest to his heart, while not disregarding any console on the market. RPGs (of any nationality) and MMORPGs are his daily bread, but he enjoys almost every other genre, prominently racing simulators, action and sandbox games. He is also one of the few surviving fans of the flight simulator genre on Earth.