Satya Nadella: Xbox’s Real Rival Isn’t Other Consoles, It’s Short Videos

Microsoft Chairman and CEO Satya Nadella recently sat down for an interview with TBPN, touching on a wide range of topics — including the company’s vision for gaming and the future of Xbox. His remarks provided new insight into Microsoft’s long-term gaming strategy amid growing speculation about the brand’s direction.

Nadella emphasized that gaming is a core part of Microsoft’s DNA, citing Flight Simulator as one of the company’s earliest products and a symbol of its enduring passion for games. “The desire to make games is deeply embedded in our culture,” he said.

He also pointed out that Microsoft’s largest gaming business isn’t its console division but Windows, which has become the foundation for major gaming platforms such as Steam.

Following the Activision Blizzard acquisition, Nadella noted that Microsoft’s goal is now to become a leading publisher, much like how Microsoft Office is accessible on any device or platform — whether PC, smartphone, or cloud gaming.

Nadella reflected on the original vision for the Xbox console, describing it as an attempt to create “the best PC for playing games.” While he acknowledged that consoles remain essential for delivering the best experiences and driving innovation, he expressed excitement for the next generation of Xbox hardware.

When asked about the ongoing “console wars,” Nadella downplayed competition with other platforms, saying the real challenge for gaming lies in other forms of entertainment, such as short-form video content. Because of this, he stressed that the gaming industry must continue to innovate — not just in how games are made, but also in how they are distributed and monetized.