Seamus Blackley, one of the key people behind the original Xbox, says he believes Asha Sharma’s job is not a bold revival, but to “gently” guide Xbox toward the exit while Microsoft treats CoreAI as the real center of gravity.

In a GamesBeat interview, Blackley argues that Satya Nadella’s massive bet on generative AI has redefined how Microsoft frames every business problem. In his view, Xbox – like many units that are not part of the company’s “core AI” effort – is effectively being sunsetted, even if Microsoft does not say so out loud. He links that outlook directly to Sharma’s appointment, emphasizing that her background is in SaaS and AI rather than the games business.

Blackley’s central metaphor is blunt: when leadership holds a generative-AI “hammer,” everything becomes a “nail,” including games. He says this mindset pushes the company away from a creator-driven content model, which is why he thinks it would have been surprising to see a leader genuinely passionate about games put in charge. Blackley frames the broader goal as steering business units “into the new world of AI,” and he expects that logic to shape Microsoft’s gaming strategy as well.

The comments landed amid Microsoft Gaming’s leadership shake-up, with Phil Spencer stepping aside and Sarah Bond also departing, while Asha Sharma took over the top role. Blackley acknowledges that outsiders can succeed in games, but he stresses that games are not simply a compute, rendering, or software problem – they are a content business. In his view, that is where the clash with an AI-first corporate strategy becomes most visible.

Source: WCCFTech, GamesBeat