A founding member of the original Xbox project has voiced concerns that Microsoft is effectively abandoning its console hardware business. This platform skepticism was articulated alongside some reservations about the long-term viability of the current Xbox content strategy.

Faced with weak hardware sales and after spending billions on developer acquisitions, Microsoft officially started shifting toward multi-platform game publishing in February 2024, when it ported Obsidian’s Pentiment to the latest two PlayStation consoles and the Nintendo Switch. Hi-Fi Rush, Grounded, and Sea of Thieves went multi-platform over the next couple of months, whereas Forza Horizon 5 and Indiana Jones and the Great Circle followed suit a year later. Over the course of June 2025, Microsoft announced two third-party Xbox devices: the Asus ROG Xbox Ally X and the Meta Quest 3S Xbox Edition, further signaling a diminishing focus on in-house gaming hardware.

Related Rumor: Xbox’s Own Handheld is ‘Essentially Canceled’ A reliable source alleges that Microsoft has shelved the long-rumored in-house Xbox handheld console in favor of third-party collaborations.

This strategic pivot has recently invited scrutiny from Laura Fryer, one of the founding members of the Xbox project and the former director of the Xbox Advanced Technology Group. In a June 28 video posted to her YouTube channel (via TheGamer), the industry veteran dissected Microsoft’s evolving vision for Xbox, positing that “it’s much easier to slap an Xbox sticker on an existing piece of hardware”—like the recently announced Asus ROG Xbox Ally X—”and call it a day” instead of trying to make something in-house.

Fryer Thinks ‘Xbox Hardware Is Dead’

“I think Xbox hardware is dead,” Fryer says in her latest video commentary, noting that Microsoft appears to be going all in on Xbox Game Pass. She pointed to the fact that Microsoft just announced the first-ever $80 Xbox game—The Outer Worlds 2—as some concrete recent evidence that the group is simply trying to drive everyone to its subscription service instead of selling them titles outright.

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Fryer Questions Xbox’s Long-Term Relevance

Fryer acknowledged that Microsoft has a vast IP library and could plausibly make this strategy work, at least for a while. She noted the recent success of Oblivion Remastered as a signal Microsoft can continue outsourcing modernized versions of its games from an era where it “knew how to build them,” making a lot of money in the process. At the same time, she expressed skepticism about how viable this approach is beyond the immediate future. “What is the long-term plan, where are the new hits, what will make people care about the Xbox 25 years from now?” the former Microsoft executive with 11 game producer credits to her name asked rhetorically.

What is the long-term plan, where are the new hits, what will make people care about the Xbox 25 years from now?

While Fryer’s perspective of first-party Xbox hardware being dead may yet be proven correct, Microsoft is rumored to be working on at least one more attempt at an in-house console. According to recent insider reports, the next-gen Xbox will effectively be a PC in a TV-friendly shell. It’s rumored to arrive between late 2027 and 2028, same as the PS6. However, the handheld console that Microsoft Gaming CEO Phil Spencer previously confirmed was being prototyped is believed to have been shelved now that the company is pivoting to portable gaming OEM partnerships.