Phil Spencer, the head of gaming at Microsoft, hasn’t been shy about his interest in developing an Xbox handheld device to go head-to-head with top-tier handheld gaming PCs like the Steam Deck OLED and Asus ROG Ally X. However, in a recent chat with Bloomberg, Spencer revealed that we shouldn’t hold our breath for its release just yet.
In the conversation, Spencer mentioned that while there’s an “expectation” for Microsoft to eventually enter the handheld market, we won’t be seeing it materialize for several years. “Long-term, I’m a fan of us creating hardware,” he shared, adding that their team is capable of delivering some groundbreaking innovations, but they want to draw inspiration from the current market trends first.
For now, Microsoft is concentrating on enhancing the Xbox app’s performance on existing PC gaming handhelds. They’re looking at how Xbox’s features and games function on these devices. Recently, Microsoft rolled out a UI update for the Xbox app on Windows, introducing a “compact mode” tailored for mobile devices. Windows 11 has often been highlighted by critics, including myself, as a less than ideal platform for handhelds like the ROG Ally and Lenovo Legion Go.
The interview also touched on Microsoft’s ongoing interest in further acquisitions, following their hefty $69 billion purchase of Activision Blizzard in 2023. They’re also working on mobile game stores, although those plans have hit some delays.
Back in early 2022, the Steam Deck set the trend for modern PC gaming handhelds. Even with the OLED update, it hasn’t received a more powerful gaming chip. Valve has indicated that there’s no immediate update in the pipeline. Most of the popular Windows handheld systems run on AMD’s Ryzen Z1 Extreme, which means the handheld gaming market is still largely in its infancy.
Meanwhile, despite being in third place behind Nintendo Switch and PlayStation 5, Spencer noted to Bloomberg that the Xbox business is thriving: “The business is performing right now, and I think that means a more healthy future for hardware and the games we build.” This growth is fueled by a rise in PC and cloud gaming, complementing their console line.
For an Xbox handheld to stand out in the crowded market, it will need to offer something unique compared to the Steam Deck and devices from Lenovo, MSI, and Asus. The coming years promise to be quite thrilling, so a delayed entry could mean Microsoft needs to pull out all the stops and deliver something truly spectacular.
