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Tom Warren

Tom Warren

Senior Correspondent

Senior Correspondent

    More From Tom Warren

    Tom Warren
    Tom Warren
    Nadella’s email about making cloud mainstream.

    The FTC reads a document from Microsoft saying it “continues to lead in the fast growing gaming cloud gaming market.” Nadella says:

    As a software company, I always think software-first, so I always want to be able to work on all platforms.

    Nadella is now looking at an email where he discusses Microsoft’s “north star vision” for cloud gaming with Xbox chief Phil Spencer.

    Another email about Meta’s quest event, where Microsoft was part of the launch of a new VR headset and promised to bring Teams and other software to the device

    I want to make it clear to the world that Microsoft is focused on cloud-first approaches. Teams, Windows 365, xCloud as the future... I want to basically use every opportunity to make cloud streaming more mainstream.

    Tom Warren
    Tom Warren
    Nadella says cloud gaming includes Xbox Live.

    The FTC moves on to ask Nadella about cloud gaming and how it can be used on TVs. “Cloud streaming can essentially transcend any device but that’ll be one use case,” says Nadella.

    I don’t think of it as strictly substitute for the console. I mean, at least the market feedback to date has been people love their consoles, people love their PCs, people love their phones and use cloud gaming as an adjunct.

    Nadella says it’s “possible” for cloud gaming to become a breakthrough market, but that it’s not something that has happened yet.

    Nadella says streaming is a “minor” part of his definition of cloud, which also includes Xbox Live:

    Just to make sure that it’s clear. Whenever I think about the cloud in the context of the Xbox pillars of content, cloud, and community, Xbox Live is part of the cloud. So even when you’re thinking about a console or a PC, the cloud is actually very integral to the experience. So it’s not just streaming alone when I think about the cloud.

    GERMANY-VIDEO-GAMES-FAIR-GAMESCOM
    Photo by INA FASSBENDER/AFP via Getty Images
    Tom Warren
    Tom Warren
    FTC highlights Microsoft’s gaming targets.

    FTC is now referring to Nadella’s own self-assessment, which includes a senior leadership team (SLT) metric to track performance of top Microsoft leaders.

    There’s also an SLT metrics slide for Microsoft’s gaming business, with a series of footnotes for the metrics. The document is confidential, and highlights Microsoft’s target for the gaming business and it’s actual achievement.

    FTC: Microsoft exceeded its metric for the gaming business, is that correct?

    Nadella: Yes, we set it low

    The FTC is now digging into Nadella’s compensation.

    Evidentiary Hearing Held In San Francisco As FTC Seeks Injunction In Microsoft And Activision Blizzard Merger
    Nadella appears at court for FTC v. Microsoft.
    Photo by Loren Elliott/Getty Images
    Tom Warren
    Tom Warren
    FTC quizzes Nadella on Xbox market share.

    Nadella is now looking at evidence the FTC is submitting. It’s a presentation about Xbox Series S / X consoles, and how Microsoft took share for two quarters in a row, and how Microsoft was the market share leader in the US, Canada, UK, and Western Europe.

    Another document says Microsoft “sold more consoles life today than any previous generation of Xbox One” and was “the market share leader in North America for three quarters in a row among next-gen consoles.”

    Nadella confirms that was all accurate.

    Tom Warren
    Tom Warren
    FTC is questioning Nadella first.

    The FTC’s lawyer is questioning Nadella first, before Microsoft’s lawyer will also speak to Nadella. We’ll likely hear Judge Corley asking Nadella questions, too.

    Nadella is largely confirming facts about Microsoft’s senior leadership team and earnings calls right now.

    Tom Warren
    Tom Warren
    Microsoft also had some redacted document issues.

    We weren’t supposed to know Microsoft was looking to acquire Bungie, Sega, and others. After the court in FTC v. Microsoft cleared the documents following the Sharpie incident, it only has one document remaining that includes Microsoft’s acquisition targets.

    It’s now heavily redacted compared to the version we saw the other day. There’s no more final “watchlist” for potential acquisition targets. Oops.

    Tom Warren
    Tom Warren
    90 minutes until Satya Nadella, let’s recap.

    We have a 90-minute break until testimony continues with Microsoft CEO Satya Nadella. There’s an unfolding drama around a Sony document that wasn’t redacted properly, but inside the courtroom we’ve covered testimony from Microsoft’s economics expert Dr. Elizabeth Bailey:

    • The Nintendo Switch argument kicks off again for the 1000th time

    • Microsoft argues it’s how gamers spend their time that matter

    • How many Xbox Game Pass Ultimate users actually use cloud gaming?

    • FTC picks apart Dr. Bailey’s opinions

    Then we heard from the vice president of Nvidia’s PC business, Jeff Fisher:

    • Just listen to how Fisher says RTX 3080 Ti first

    • Fisher thinks PC gaming will always be better than consoles

    • Nvidia might be a little steamed about Xbox dismissing cloud gaming

    We’ll be back at 1:30PM PT with Microsoft CEO Satya Nadella.

    Sony’s confidential PlayStation secrets just spilled because of a SharpieSony’s confidential PlayStation secrets just spilled because of a Sharpie
    Tom Warren
    Tom Warren
    It’s time for Nvidia’s Jeff Fisher video deposition.

    Tie or Ti in a GeForce 4080 Ti? Jeff Fisher at Nvidia has tried to answer that in the past, and the vice president of Nvidia’s PC business is now appearing via a prerecorded video deposition. Nvidia was against Microsoft’s Activision Blizzard acquisition until the Xbox maker struck a deal earlier this year to bring Xbox PC games to Nvidia’s GeForce Now service.

    Nvidia’s Jeff Fisher.
    Nvidia’s Jeff Fisher.
    Image: Nvidia
    Tom Warren
    Tom Warren
    The court has pulled all its exhibits after the Sony redaction mess.

    While we listen to Dr. Bailey’s testimony, a storm is unfolding elsewhere in the FTC v. Microsoft case. The court uploaded a document earlier from Sony that included confidential financial information that wasn’t properly redacted. Now all the documents have suddenly disappeared.

    It looks like some redacted the documents with a pen and when you scan them in it’s easy to see the redactions. Reporters and Sony’s competition will have downloaded all the documents as they were in the public domain, so the damage is done:

    • Horizon Forbidden West apparently cost $212 million over five years with 300 employees

    • 1 million gamers play nothing but Call of Duty

    • Sony says only one more Call of Duty game was guaranteed to come to PlayStation

    SKOREA-JAPAN-GAMES-FINAL FANTASY
    Photo by ANTHONY WALLACE/AFP via Getty Images

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