During the GeekWire summit, Xbox Division Head Phil Spencer was asked whether or not he think he can beat Sony this generation, and that sparked some very interesting insight.
I don’t know. You know, the length of the generation… They have a huge lead and they have a good product. I love the content, the games, that line-up that we have.
Spencer also mentioned that he didn’t realize as much as he should have the impact that the Xbox team received by the missteps around the launch. Some words and actions from executives at Microsoft were detrimental for the team.
Regaining the team Spencer’s first job when he started, and being very forthright with them about what was their position and about their ability to do things like beating Sony was “critical.”
Spencer is seeing that the team is now doing more work in a day that he would expect. He has seen the transformation of the team from one that was questioning the leadership iof the organization to one motivated by the customers and by its own ability to delight them, and that’s a team that is making progress.
I would never question the ability of our organization, but I’d say that we’re not motivated by beating Sony, but we’re motivated by gaining as many customers as we can.
Spencer also mentioned that initially he focused on winning the console race, but that has since changed, and from now on he’s going to talk a lot less about the competition:
As a leader of my team, and somebody who’s interacting with the Xbox community, it was much more beneficial and I could have more impact focusing on the product that we had. It was a change for me. Even in the 18 months I’ve learned that.
You’ll hear me talk a lot less about the competition. People will say, you’re losing so of course you’re not going to bring that up. Maybe we’ll test it someday. If I’m winning, I think I’ll stay in the same swim lane. It is really about the product that we have, the features that we add, and how we treat the customers of our box.
Lastly, he explained that market share is important, but in the end earning new customers and making them happy is more relevant:
And from a day-to-day basis, the financials are important. I know, sitting inside Microsoft, that if I’m not running a financially viable business, I can’t make a long-term commitment to my customer that they should buy an Xbox, because frankly if the box isn’t a profitable business for the company, I can’t promise that it will be there.
That’s important to me. Share is important, but more than share, it’s are we gaining new customers, are they happy, are they buying games, are they using Xbox Live, are they engaged in the service.
I can’t say I find anything to disagree with in what Spencer said. While market share is a good topic to inflame the fans, profitability and growth are more important for a company. Given what we’ve seen lately from Xbox, that kind of focus seems to be paying of very nicely.