The head of Xbox just unveiled a new console, but Phil Spencer isn’t too worried about selling you one. “I don’t need to sell any specific version of the console in order for us to reach our business goals,” the told me in an interview yesterday, the day after Microsoft held its annual E3 keynote.

There’s plenty going on with Xbox and gaming at Microsoft. In addition to a big lineup of games, at E3, Microsoft officially unveiled Project Scarlett, its next-generation console that launches next year, and provided a bit of detail on its xCloud streaming service, which will debut in October. Just ahead of the show, the company also brought its Game Pass subscription to PC, furthering its foray into services.

I had the chance to chat briefly with Spencer about all of the major announcements. We talked a bit about the future of consoles, the importance of the cloud, the impending ubiquity of subscription services, and why he doesn’t care what kind of Xbox you buy.

This interview has been edited and condensed for clarity.

With Scarlett, can you talk a bit about the strategy of announcing a console so early? It reminds me a lot of Scorpio. Was there something about the experience with Scorpio that made you think, “This is how we should do it”?

I definitely think doing the announcement of Project Scorpio 18 months-ish before we launched X was good learning and background for us this year. I think that’s definitely true. I think that gave us some confidence that we could keep buzz. We also know that we’re going to have dev kits out, developers building games, and I’d rather not have to pretend that something is not happening when everybody knows it is happening.

So it puts you in this position of people asking you, “What’s the name?” and I say, “We don’t have the name yet.” They ask me about price points and everything else, so you’re in this position of talking about the things that you set. Most importantly, you’re going to talk about what your goals are for the platform. Give people something to look to, so when they hear there’s a game in development that’s launching at a certain date, is it going to support X? And I think our experience with Scorpio gave us the confidence to talk about Scarlett on Sunday.

The Xbox One X came out not that long ago, and you call it the most powerful console. How do you know when to release something that’s even more powerful? It’s not a huge gap in time between the two.

We did the same thing with X where we set a design goal for ourselves. In the case of X, it was about a 4K console. We looked at: could we do a 4K console a year earlier? We didn’t think we could. So we waited a year after the competitors did their thing because we felt we could give a true 4K console with the Xbox One X. I think the end result is a device that, if a developer so chooses, they can do so.

With Scarlett, our goal was to increase the visual fidelity of the games. But equally or even more over what we have today was the feel of the games. Can we really start to get to frame rates where the visuals that are great on-screen are matched by the way the game feels and how smooth it plays? Which was really looking at CPU performance and the growth in CPU and what we could put in. Traditionally, consoles have been heavy GPU, very light CPU. So we were working with AMD on technologies and what their CPU road map looked like. You can see this on X and even S, experimenting with variable refresh rates. So much of your refresh rate, your game loop, and having this synchronization between those things really helps create buttery controls in a game.

Working with AMD, we were able to hit CPU, memory, bandwidth, and even SSD that was going to allow us to stream data fast enough to get to frame rates where we felt like the increased visual fidelity would be matched by the feel that we would be able to bring. And that was a design goal that we set for ourselves with Scarlett.

So is Scarlett one console? Or is it like the Xbox One where you have a high-end, a middle class, and a cheaper one?

The video that we showed is talking about Project Scarlett. That’s the focus that we have, on that console and hitting that specification. That’s the console that we’re talking about.

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