Xbox has been in the news a lot lately, and not for the best reasons, with reports claiming that Microsoft was abandoning plans to make future console platforms. Microsoft denied those reports, but one former executive, Mike Ybarra, said recently that Microsoft getting "out of hardware and exclusive games" might actually be a good business decision in this environment.Ybarra said it "makes sense" that Microsoft did not put the Xbox operating system on the recently released ROG Ally X, opting for Windows instead. It makes sense, Ybarra said, because he believes Microsoft is "out of the hardware and exclusive games" business."That includes the dedicated OS, which is essential for any console device (ease of use, security, etc). They are a publisher who will embrace Windows. Most will just pirate all the games to the devices unless they use Steam. Why does Steam help piracy? Because it's a flawless experience with a great return policy," Ybarra said, adding that Windows is "far from a flawless experience."Microsoft no longer making its own dedicated hardware could be good for business, but only if Microsoft can "make good games" and embrace putting games on Steam, PlayStation, and Nintendo. That's a big "if," Ybarra said."Only a moron would continue to make console hardware when the games all go (or will go) third-party. To shift, they’d have to go back to exclusive, make great hardware at a loss, and strive to win the living room," he said. "That's not their strategy (which is fine), but for some reason they just keep riding the middle, not being clear, doing more harm for no reason."Microsoft, like Sony and Nintendo, once focused on creating games exclusively for its own platforms in part to help drive sales of those platforms. However, Microsoft started putting its own first-party games on rival platforms in a significant way earlier this year and has expanded the program since then. The formula appears to be working, at least by some measurements, as Xbox games are dominating PlayStation sales charts.Ybarra went on to say it's imperative for Microsoft to highlight a "clear strategy" so the company can "rip the band-aid off and focus on execution." Right now, without embracing this strategy, Microsoft is facing "death by a thousand needles" for its gaming business, Ybarra said."Needles > cuts. It just feels like they keep pushing the needles in further and further. Cuts heals--I don't see any healing happening--just more needle pushing deeper and deeper," he said.Ybarra also sounded off on Microsoft's "This is an Xbox" ad campaign, which aims to remind people that they do not need to buy an Xbox to play Xbox games because some of the devices they may already own play Xbox games. Ybarra said of this marketing campaign: "Wrong idea, wrong time.""Xbox is about games--games always rule the world. And if they don't have parity between the console and any other 'device' … then it's just not an Xbox. Confusing--whoever came up with this clearly doesn't play games," he added.Xbox president Sarah Bond recently told Variety that Microsoft has "next-gen hardware in development," following the announcement of a big multi-year deal with AMD."We are always listening to what players and creators want. When there is demand for innovation, we'e going to build it," she said.Microsoft has also faced backlash recently regarding the 50% price hike on Xbox Game Pass Ultimate, which is souring the appeal of the subscription service for some. Microsoft has also cut jobs, closed studios, canceled games, partnered with Israel's Ministry of Defense, and pledged billions of dollars to AI.Ybarra worked at Microsoft for 19.5 years, starting as a systems engineer in 2000 and rising to become corporate vice president at Xbox. He joined Blizzard in 2019 and was its president until May 2024. He then joined PrizePicks later that year and is its current CEO.