The next generation is looming overhead, yet Xbox head Phil Spencer doesn't seem worried about the direct opposition. When it comes to Microsoft's competition, Spencer says it will be Amazon and Google, not Sony or Nintendo; in fact, Microsoft is fairly open to working with its usual console rivals.
Speaking to Protocol, Spencer identifies cloud infrastructure as a key point that Microsoft has over Sony and Nintendo. Microsoft has the Azure platform, which can enhance its xCloud streaming service, putting it up against things like Amazon Web Services rather than a new PlayStation.
"When you talk about Nintendo and Sony, we have a ton of respect for them, but we see Amazon and Google as the main competitors going forward," Spencer told Protocol. "That's not to disrespect Nintendo and Sony, but the traditional gaming companies are somewhat out of position. I guess they could try to re-create Azure, but we've invested tens of billions of dollars in cloud over the years."
In fact, Spencer says that Microsoft is willing to work with Sony and Nintendo on things like crossplay, allowing players to pick which console they want to play on. "I don't want to be in a fight over format wars with those guys while Amazon and Google are focusing on how to get gaming to 7 billion people around the world," Spencer says. "Ultimately, that's the goal."
While Amazon continues to build up AWS, Google's efforts so far with Stadia haven't been going well. Other companies, like Nvidia, are starting to roll out their own take on cloud gaming as well though, so as the next generation looms, it looks like Microsoft will have some competition for xCloud. With its own Xbox Series X and a new PlayStation both due out this year, the cloud could be an X-factor.