Xbox Founder Seamus Blackley Warns Microsoft Could Gently Sunset Xbox as Core AI Becomes the Priority
Xbox founder Seamus Blackley has delivered one of the sharpest public critiques yet of Microsoft’s current direction, arguing that Xbox is no longer a strategic pillar inside the company and is instead being positioned for a slow, carefully managed wind down. In an interview with GamesBeat, Blackley says the company’s center of gravity has shifted to its core AI business, and he believes that reality defines the mandate of newly appointed Xbox CEO Asha Sharma.
Blackley’s message is not subtle. He frames Xbox as a business unit that is not aligned with Microsoft’s primary objective anymore, and he claims the company will not explicitly say it, but the outcome will be the same. He describes Sharma’s role as guiding Xbox gently into the night, using a palliative care metaphor to underline what he sees as a controlled transition rather than a sudden shutdown. It is a headline designed to land hard with longtime Xbox fans, especially after recent leadership turbulence and ongoing anxiety around hardware commitment and the multiplatform strategy.
A key part of his critique is philosophical. Blackley argues that Microsoft leadership increasingly views AI as an abstraction layer that can subsume problems across industries, and he extends that argument to games. In his view, this creates a misalignment with the creator driven, auteur style model that has historically defined premium game development. His point is that games are not just a services business, they are also a culture business, and he suggests Microsoft is structurally incentivized to prioritize AI enablement over artistic leadership. Whether you agree or not, it is a direct challenge to Microsoft’s current messaging and a signal that early Xbox era leadership does not recognize the current playbook as compatible with what made the platform matter in the first place.
The staffing narrative is part of why the interview is resonating. Sharma’s prior role leading Microsoft’s CoreAI product portfolio is being used by critics as evidence that her appointment is aligned with AI first corporate priorities rather than a games first turnaround. That optics problem has been amplified by recent social media discourse, including claims from some gamers that her X interactions felt automated, even though she pushed back on that perception and has stated she does not want to flood the Xbox ecosystem with soulless AI slop.
Still, it is worth separating sentiment from certainty. Blackley is offering an interpretation, not an internal roadmap. Xbox is currently in a complicated position where multiple truths can coexist: Microsoft can continue releasing hardware, expanding PC and cloud reach, and pursuing multiplatform publishing while also tightening executive focus on AI. The question is not whether AI matters, it clearly does. The question is whether Xbox remains a first class product platform or becomes primarily a distribution channel that supports broader Microsoft priorities.
If Microsoft wants to neutralize this narrative, the fastest way is not more talking points. It is execution. A clear next console plan, a consistent first party release cadence, and transparent platform identity would do more to restore confidence than any one executive quote. Until then, interviews like this will keep filling the clarity vacuum.
Do you think Xbox is heading toward a real sunset, or is this just a painful transition period while Microsoft tries to redefine what Xbox means across console, PC, and cloud?
