Satya Nadella was named CEO of Microsoft on February 2, 2014 and already it seems to be bad news for the Xbox division. Many analyst predict that Microsoft should spin off the Xbox division along with all the other hardware departments and return to its roots in software. This is believed to be the best way to bring Microsoft back to staggering profitability like it once was in its heyday.
On a letter emailed intended to address employees as newly acting CEO. Mr. Nadella described his vision for Microsoft as "software-powered world," a "mobile and cloud-first world,”. Mr. Nadella’s direction for the company derives from his many years heading the company’s successful enterprise and cloud services division.
Spinning off the Xbox division may be a deathly blow to Microsoft, as the much beloved Xbox platform has become a staple of the company. Much like what Windows and Office platforms have for the last several decades.
More importantly it keeps their chief competition, Apple Inc. at bay. Apple is poised to release a product on the Smart TV market, but this is an area where Microsoft has a strong foothold with the Xbox One.
The Xbox One is the quite essential all in one media entertainment device for the living room, and with the promise of the future ahead of it. The Xbox platform can be the number one division within the company, much like what PlayStation is to Sony in its product portfolio.
Mr. Nadella should take heed from his predecessor, Steve Ballmer and continue to position Microsoft as a devices and services company.