Xbox and AMD deal explained: What are they working on?

In short, Xbox is working with AMD to create a 10th-generation console and handhelds, with the latter most likely to be made by third-party vendors such as Asus.

The partnership alone does not come as much of a surprise, as the Xbox One and Series consoles are all powered by AMD SoCs (Silicon on a Chip). These SoCs feature both the CPU and graphics processor on one chip, much like in your phone or in a thin-and-light laptop.

It’s also not the first announcement of this sort for the next generation of consoles, as Sony already announced its partnership with AMD, dubbed “Project Amethyst”, which seeks to utilise AMD's next-gen hardware and AI technologies.

We’ll no doubt see the fruits of Project Amethyst’s labour in the next Xbox, as PS5 lead-architect Mark Cerny said during the PS5 Pro Technical Seminar that "Amethyst is not about proprietary technology for PlayStation," and went on to say that “Both SIE (Sony Interactive Entertainment) and AMD will independently have the ability to draw from this collection of network architectures”.

With Microsoft being an AMD customer, it’s fair game then.

But Microsoft’s announcement does go a step further, as Bond laid out a grand vision of sorts of what the Xbox brand will mean going into the next generation, saying: “At Xbox, our vision is for you to play the games you want, with the people you want, anywhere you want.”

Bond continued: “That’s why we’re investing in our next-generation hardware lineup, across console, handheld, PC, cloud and accessories.”

With the reveal of the ROG Xbox Ally X, the handheld front is already covered, as is console, PC and cloud. So what’s new?

As part of that reveal, Microsoft was keen to emphasise the improved functionality of Windows 11 on handheld devices.

SteamOS from Valve, as found on its handheld, the Steam Deck, has long offered a PC gaming experience that is navigable with a controller, with its Linux desktop ready to be dipped into, but not taking centre stage.

It’s not just in function that Microsoft wants to emulate SteamOS, however, but also in spirit, as it would appear Microsoft sees its longstanding monopoly on PC gaming as its way of revitalising Xbox, by way of blurring the line between console and PC as Microsoft seeks to deliver "an Xbox experience not locked to a single store or tied to one device". and is "working closely with the Windows team to ensure that Windows is the number one platform for gaming".

That certainly sounds mightily a lot like how a PC functions, where users can install Steam, the Epic Games Store, GOG and so on.

Microsoft games are already becoming platform agnostic, with titles such as Gears of War coming to PlayStation, something unthinkable back in 2006, so expanding where you can buy games from on an Xbox doesn’t feel like much of a jump beyond that.

If Xbox is to become more PC-like, it could spell trouble for backwards compatibility. Not so much for older generations of Xbox, which could be achieved by computational brute force, but for Xbox Series games, which even PCs in the near future would have trouble emulating.

Microsoft seems to have figured something out, though, as they ensure that whatever variety of Xbox you are playing, it will maintain “compatibility with your existing library of Xbox games".

How this will be achieved is not quite clear yet, but Microsoft has laid down the gauntlet. They’ve also delivered on this front before, with PowerPC-code Xbox 360 titles working flawlessly on the Xbox One in 2013.

But by having storefronts such as Steam available on the next Xbox console, this puts Sony in a tricky situation.

PlayStation still enjoys a good spread of exclusives, which then make the jump to PC after a period of time. To date, this affords the PlayStation brand a certain sense of prestige that Sony will be keen to maintain, but the illusion may be shattered if titles in iconic franchises can be played on an Xbox.

Going multiplatform has lined Sony’s pockets too, with PC ports bringing in $650 million in fiscal year 2024, it’s a drop in the ocean compared to the PlayStation Store revenue, which came to $16.5 billion.

To avoid a world where Intergalactic and a future Last of Us game come to Xbox, could Sony potentially afford to put a stop to PC ports?

With Stellar Blade selling over a million copies in just three days, that future doesn’t seem particularly likely, but it’s anyone’s guess as to how Sony will navigate it.

As Sarah Bond puts it: “The next generation of Xbox is coming to life, and this is just the beginning."

Check out more of our Gaming coverage or visit our TV Guide and Streaming Guide to find out what's on. For more from the biggest stars in TV, listen to The Radio Times Podcast.