Microsoft’s ‘Principled Approach to App Stores’ That Doesn’t Apply to Xbox

Microsoft president Brad Smith, in a post laying out the company’s 11 principles for app stores:

Second, some may ask why today’s principles do not apply immediately and wholesale to the current Xbox console store. It’s important to recognize that emerging legislation is being written to address app stores on those platforms that matter most to creators and consumers: PCs, mobile phones and other general purpose computing devices. For millions of creators across a multitude of businesses, these platforms operate as gateways every day to hundreds of millions of people. These platforms have become essential to our daily work and personal lives; creators cannot succeed without access to them. Emerging legislation is not being written for specialized computing devices, like gaming consoles, for good reasons. Gaming consoles, specifically, are sold to gamers at a loss to establish a robust and viable ecosystem for game developers. The costs are recovered later through revenue earned in the dedicated console store.

Nonetheless, we recognize that we will need to adapt our business model even for the store on the Xbox console. Beginning today, we will move forward to apply Principles 1 through 7 to the store on the Xbox console. We’re committed to closing the gap on the remaining principles over time. In doing so, we will incorporate the spirit of new laws even beyond their scope, while moving forward in a way that protects the needs of game developers, gamers, and competitive and healthy game-console ecosystems.

This exception for gaming consoles echoes the arguments from Epic CEO Tim Sweeney, but as I wrote back in August 2020, I don’t think they hold water. Microsoft and Sony may lose money on Xbox and PlayStation console sales, but Nintendo doesn’t. Apple makes an enormous profit selling iPhone hardware, but Google doesn’t profit similarly from Android handset sales, and many of the companies that do make Android handsets earn very little money on hardware sales.

Companies are going to advocate for their own interests, of course, but it’s a little rich to see Microsoft push for openness on all platforms but gaming consoles — the one market where they themselves own and control a closed platform.

★ Monday, 14 February 2022