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Phil Spencer: Xbox Staying Out of VR Hardware Market

Phil Spencer: Xbox Staying Out of VR Hardware Market - News

by William D'Angelo , posted on 01 November 2021 / 2,706 Views

Head of Xbox Phil Spencer speaking with The Wall Street Journal Tech Live and transcribed by VideoGamesChronicle was asked if he was content with Xbox to leave virtual reality as a "differentiator" between it and PlayStation. 

Spencer applauded what Sony is doing with PlayStation VR, Valve with its Valve Index, and Oculus, however, there are no plans for Xbox to enter the VR hardware market. The plan is for Xbox to focus on software.

"I think that when we think about immersion, we think about mixed reality, virtual reality, I’ll even take it to metaverse, which seems to be the buzzword of the day now," said Spencer.

"We’re big believers in that software platform and the devices that will enable that. Absolutely. [But] we’re focused a lot more on the software side of that right now. When I think about immersive worlds and I think about the connection of a player and community, that’s something that’s very high on our investment list.

"I think the devices that are out there now, we stay connected with a lot of the players that are out there. [With] people building hardware, a lot of that happens on Windows and we experiment and talk to a lot of the partners that are there.

"I think that the hardware innovation that’s happening is great and it’s an important enabler, [but] right now I’m deciding to stay more in the software side of that enablement. I believe it will scale better in the long run.

"And you know, I applaud what Sony‘s doing, I applaud what Oculus is doing, what Valve has done. I mean, there’s a lot of good players out there that have done some amazing VR work. But yeah, we’re gonna stay as a company right now in the consumer space focused on software, and I think that’s a good bet."


A life-long and avid gamer, William D'Angelo was first introduced to VGChartz in 2007. After years of supporting the site, he was brought on in 2010 as a junior analyst, working his way up to lead analyst in 2012. He has expanded his involvement in the gaming community by producing content on his own YouTube channel and Twitch channel dedicated to gaming Let's Plays and tutorials. You can contact the author at wdangelo@vgchartz.com or on Twitter @TrunksWD.


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52 Comments
G2ThaUNiT (on 19 October 2021)

I don't blame them for that decision. VR is still very niche. Last I saw, PSVR surpassed 5 million unit sold, which is still very commendable, but the VR platform is still some years away from truly being a mainstream hit. Maybe PSVR2 will be what the platform needs to break through!

Plus, lets be real, Xbox needs to shore up their first-party software first before they get into other gaming business ventures lol, which they are working hard on

  • +18
DonFerrari G2ThaUNiT (on 19 October 2021)

Well they will be again in a catch up competition, one they didn`t had luck on consoles business.

  • -10
Dulfite DonFerrari (on 19 October 2021)

What's to catch up on? VR is never going to be as big as standard gaming, let alone mobile gaming in my opinion. There is a casual crowd that enjoys it like when Wii motes came out, but in a few years they will move on and never look back, leaving only the hardcore doing VR and that isn't a big enough market to make the kind of profit MS wants.

  • +9
victor83fernandes Dulfite (on 19 October 2021)

But that's the problem with microsoft, they just think about profits, but to have profits you first need to show a reason to buy your console instead of the competition, and when the competition shows constantly better exclusives and new ideas such as VR, new controller and so on, then consumers will choose the competition instead.
You say VR will never catch up to normal gaming, I agree, but microsoft is not even having any normal gaming in there, everything is on PC, just think about it, we are almost 1 year into the generation and there's no xbox series exclusives at all while ps5 already has Returnal which is excellent, Demon souls which is excellent, ratchet and clank which is excellent, and some other ps exclusives not on PC too. On top of that they also have enhanced versions of Death stranding, Ghost of tsushima, spiderman, final fantasy and more, all not on xbox. And with the new god of war and new GT soon and new horizon zero dawn I don't see how microsoft will have any change of competing. The new elder scrolls and fallout are years away from release. Halo might be good, but its just another halo.
The ori games are fantastic but I got them on PC and switch. Quantum break was fantastic, but ruined by the several 20 min long cutscenes.

  • -1
Azzanation victor83fernandes (on 19 October 2021)

MS main focuse isnt about selling just the hardware. Its about the eco system. MS have VR games on PC, and PC gamers have access to VR units. Technically MS dont need to make VR hardware because the best VR headsets are made by 3rd party companies which is also on another MS platform.

  • +5
DonFerrari Azzanation (on 20 October 2021)

Wich VR focused game MS released for PC?

  • -5
Azzanation DonFerrari (on 20 October 2021)

Does it matter if the games are focused or have a VR option? To answer your question, Microsoft Flight Simulator has VR options.

  • +2
victor83fernandes Azzanation (on 20 October 2021)

And that's why you keep getting scammed by them. Keep believing. Just like when they hyped games with major purchases last year, one year into the generation and there's no single exclusive on xbox series.
Eco system to microsoft means monthly payments, money, but where's the great games?
So Microsoft doesnt need VR because PC has it? Thats your logic? Then you just made my point, no one needs an Xbox at all, just get a PC and you get all xbox games + VR + sony games + PC exclusives too.
My point is, if you're looking into a console right now, ps5 has innovative features on the controller, great exclusive games and soon VR, so anyone looking at VR will just get a ps5. Even if VR doesn't sell a lot, its a piece of the market that will go to Sony.

  • -3
Azzanation victor83fernandes (on 21 October 2021)

Correct, No one needs an Xbox if you have a PC outside of console simplicity and convenience. That's the entire point of Microsoft's Business model, they don't care what you game on, as long as its on one of their platforms. If you game on PC, than you have the best VR experiences already available, and guess which OS majority of PC gamer's game on.. Windows, and guess who owns that, your favorite brand MS. What they lose on consoles, they gain on Windows.

  • +5
SvenTheTurkey DonFerrari (on 20 October 2021)

I'm sure they have some money invested in research. There's no way they have nothing started. They must not think it's worth developing a complete product yet.

  • +7
DonFerrari SvenTheTurkey (on 20 October 2021)

Yep, it is likely that they have some money on the R&D.

  • 0
victor83fernandes G2ThaUNiT (on 19 October 2021)

Not working hard enough when the competition can pump out excellent exclusives frequently while still developing VR games and a new VR headset.
Microsoft is being very lazy since mid 360 days.

  • -8
G2ThaUNiT victor83fernandes (on 19 October 2021)

One word: management

  • -9
victor83fernandes G2ThaUNiT (on 19 October 2021)

Maybe, I think they just dont care, they just want to make money with no effort, they made xbox live and they thought, lets just ride it out wait for the money to keep pouring in.

  • -8
Azzanation G2ThaUNiT (on 19 October 2021)

You understand MS have VR titles right? They just are not dedicated to creating thier own branded hardware. No need competing with the 3rd party headsets.

  • +6
DonFerrari Azzanation (on 20 October 2021)

They don`t need to compete with the other parties consoles, they could have been just making their SW for PC and consoles, still they see a reason to.

  • -5
Azzanation DonFerrari (on 20 October 2021)

Maximized all protential sale avenues. Why just focus on PC when they can also sell 50m consoles?

  • 0
DonFerrari Azzanation (on 21 October 2021)

Waiting for you to show these MS developed titles that are focused on VR, not only had VR added on later as after though. Otherwise they aren't really supporting VR, they are just wanting a little more profit for a little more investment which doesn't really help VR move forward on the capacity of such a big company.

  • 0
Azzanation DonFerrari (on 21 October 2021)

Now you are just moving the goal posts

  • 0
DonFerrari Azzanation (on 21 October 2021)

One game that isn`t even made by an internal studio, with a patch that comes months after launch for your qualifies as MS investing in VR, sure, when it is on MS camp you take as most as you can.

  • 0
Azzanation DonFerrari (on 21 October 2021)

You continue to change the rules to suit your viewpoint. The fact MS have VR enabled games doesn't suit your argument so now you call it "Focused on VR and not added on later by a patch" rule. It does not matter, the fact they have VR titles doesnt change. The game that uses VR has MICROSOFT IN ITS BLOODY NAME!

  • 0
victor83fernandes Azzanation (on 20 October 2021)

I dont know what you are talking about when there is no VR titles or hardware on Xbox, did you even read the article, we know PC has VR that's not news.

  • -3
Azzanation victor83fernandes (on 21 October 2021)

Their are Xbox games on PC which have VR options.

  • +4
VAMatt (on 19 October 2021)

I didn't hear him rule out VR running on XBSX, just that MS won't be making the hardware.

  • +17
Sogreblute (on 19 October 2021)

Either they don't see a big market for it yet, or they don't want to split their resources since they are already concentrating on Console, PC and Cloud. So adding another platform is probably too much to handle right now.

  • +7
DonFerrari Sogreblute (on 19 October 2021)

They do have the money if they intended to.

  • -8
eddy7eddy (on 20 October 2021)

I can only see AR for regular glasses with hands motion detection to become something mainstream for general public.

  • +3
Dante9 (on 20 October 2021)

Eventually everyone will be gaming inside pods that create a virtual world that's hard to tell apart from reality. But it will take a few generations to get there.

  • 0
SvenTheTurkey (on 20 October 2021)

I feel like VR needs to stop focusing on the VR. Here's what I mean. So far, VR is an investment to have a particular experience. I think companies need to focus on the game design and add the VR hooks in later.

But that seems to be what he's hinting at. These are problems that will get worked out over time. But there are definitely a lot of barriers keeping VR from the mainstream in terms of the hardware/ perception. Both of those things need to change for Microsoft to get into it. They're a company that typically doesn't blaze a trail. They enter established markets and buy a foothold until they start making money in their own way.

  • 0
DonFerrari SvenTheTurkey (on 20 October 2021)

There are some very good games designed around regular gaming with some VR added later. Like GT, RE, (DC got a spin-off series), etc. So yes I do think it is good to have more and more games with VR added, leave the exclusive VRs to unique experiences that couldn`t be made outside of it (Indies already try it).

  • -1
LudicrousSpeed (on 19 October 2021)

Oh man I just heard the cries of the dozens of VR users as they read this news

  • -1
eddy7eddy LudicrousSpeed (on 20 October 2021)

I don't know, when you have a capable VR device, you understand why it's not for the mainstream public; you get tired really fast, can't be used for a long time sadly.
I can see microsoft investing in their AR technology only.

  • +4
LudicrousSpeed eddy7eddy (on 20 October 2021)

I bought my son a mixed reality headset a few years ago and a Quest 2 last Christmas. The tech is cool but it’s motion controls and Kinect right now, just a gimmick.

  • +3
eddy7eddy LudicrousSpeed (on 20 October 2021)

Quest 2 is pretty good, we just need more power from a mobile chip, we are getting there.

  • 0
victor83fernandes (on 19 October 2021)

Big mistake for microsoft, first they cant compete in exclusive games, then all the buzz about the ps5 controller, which I personally don't actually enjoy the haptics, but I love the adaptive triggers. But VR is the future, how can microsoft not invest in it?
Fortunately I don't need an xbox as all games are on PC and my PC is more powerful than the xbox series X, and I have VR there.

  • -2
Azzanation victor83fernandes (on 19 October 2021)

They dont need to, because others are making it for them.

  • +5
siebensus4 (on 19 October 2021)

So why do they have Kinect? Is VR really that different from a hardware - software experience? Focusing only on software is then a pretty new strategy.

  • -2
Dulfite siebensus4 (on 19 October 2021)

They don't have the kinect. They had the kinect. They aren't pushing that technology anymore, with good reason.

  • +12
AJNShelton (on 19 October 2021)

Kind of disappoitning, without real competition, VR will never be the next big thing

  • -2
Jumpin AJNShelton (on 20 October 2021)

I have no idea why your post has so many downvotes on it. It’s not even remotely controversial.

  • +3
AJNShelton Jumpin (on 20 October 2021)

Because it's not fully positive about Xbox

  • +1
Azzanation AJNShelton (on 21 October 2021)

VR doesn't need competition, it needs advancement. Their is already a ton of VR units to buy. If Sony wants to progress and Push VR, than bring PSVR to PC and grow the audience even further.

  • 0
DonFerrari Azzanation (on 21 October 2021)

Advancement comes from competition.

  • 0
Azzanation DonFerrari (on 21 October 2021)

Not necessary. Steam doesnt need competition to be a best service. If anything competition is making it worse, cough Epic. Also PRVR has plenty of competition, its on PC.

  • -3
AJNShelton Azzanation (on 21 October 2021)

Steam has competition

  • 0
Azzanation AJNShelton (on 21 October 2021)

And what competing service did Steam compete with to become the service it is today?

  • 0
Fight-the-Streets (on 20 October 2021)

I just dislike this dude. The kind of corporate nonsense that comes out of his mouth is unbearable. Look just how often he praises the competitors, it's a classical corporate talk to make yourself the nice and friendly guy and in turn should reflect on the company he represents. Like if a right-wing politician would praise the black society with flowery words but there will be the BUT only that hew will hide it.

Also, pay attention how often Phil talks about the community. It's his favorite word. He uses it in a way as if before GamePass there was no gaming community, as only thanks to Microsoft and GamePass there is a gaming community now. I just dislike this guy!

  • -4
DonFerrari (on 19 October 2021)

Let`s forget the promises on X1 and if they are investing in the SW side of the VR which VR game have they launched?

  • -9
mjk45 DonFerrari (on 19 October 2021)

He most likely alluding to Windows rather than specific games.

  • 0
DonFerrari mjk45 (on 19 October 2021)

Not sure what he does have to do with Windows.

  • -4
Azzanation DonFerrari (on 19 October 2021)

Flight Sim

  • +4
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