Nilay Patel

He's actually out on parental leave right now.

But Microsoft has a long habit of disrupting his time off with major news.

So Tom was gracious enough to come back on the show after he published a major scoop about what exactly went down at Xbox this past week.

There's a lot to say about Xbox.

The story of the console and Microsoft gaming is a complicated one, with a lot of twists and turns since that first Xbox console made its big splash in the industry 25 years ago.

But for a majority of the time since, it's been stuck in third place, behind Nintendo and PlayStation.

That's a surprising thing to say for a division of a company worth trillions of dollars

and also owns some of the most celebrated gaming properties in all of entertainment.

And so Phil Spencer, who started at Microsoft in the late 80s and took charge of Xbox in 2014, was given the job of trying to turn things around.

Since then, he has tried many things.

The Netflix-style Game Pass subscription service, a major push into cloud gaming, buying Activision Blizzard King, which makes Candy Crush, and many, many different iterations of Xbox hardware.

As of last year, he even had plans to bring Halo to PlayStation, something game industry insiders thought was basically impossible just five years ago.

But as you'll hear Tom explain, the game industry has been changing faster than Xbox has been able to transform itself, and almost none of Spencer's strategies have ever really clicked.

Xbox is still far behind Nintendo and PlayStation, and in PC games, it still stands in the shadow of Valve, which runs the dominant Steam store and now makes the Steam Deck handheld.

Microsoft has spent tens of billions of dollars trying to acquire its way to a stronger position against the rise of games like Fortnite and Roblox, mobile giants like Tencent, and a zero-sum war for attention dominated by apps like YouTube, Instagram, and TikTok.

and yet it has very little to show for all of that.

And so today, Phil Spencer's grand vision of 100 million Game Pass subscribers streaming Xbox games to whatever screen they want on a cloud platform, well, that feels out of reach.

But as Tom says, it's not lost forever.

Xbox is far from dead, and there's hope that new leadership will take some big swings and make something happen again.

Okay, here's Verge senior reporter Tom Warren on the future of Xbox.