The Xbox One had a rough first year, and no other console has had to change its failing strategy so rapidly after launch. One could argue that Nintendo is struggling a bit more in the current market, but Microsoft has shown a willingness to listen to its customers and adapt its product in a way Nintendo seems unwilling, or unable, to emulate.
The Xbox One was announced in May of last year, in what has to be one of the worst product reveals in electronics history. The message was muddled, simple questions from the press were met with conflicting information, and players began to revolt against Microsoft's all-digital future almost immediately.
The Xbox One outsold the PlayStation 4 for the first time in the console's history in the US and UK this November. The two events seem to have happened in two different industries, but that only proves how humble, not to mention nimble, Microsoft became in 2014 when it comes to the Xbox One.
Price, price, price
The problem with the Kinect was never the hardware itself, although it did suffer from false-positives and an inability to play nice with many accents, but the fact that its forced inclusion drove up the price of the Xbox One.
The hardware was more expensive than its immediate competition, and many players didn't see the value of waving their arms at their television to change channels or play a game. You could talk to the Kinect, but it would often misunderstand you.
Microsoft failed to learn the importance of having a low initial price, and the Xbox One found itself in the uncomfortable situation of being the most expensive console due to a piece of hardware that only worked some of the time and was hard to describe to a mass audience.
The Kinect was removed from the system as a forced pack-in in May of this year, almost exactly a year from the console's announcement. This allowed Microsoft to lower the price of the hardware, and sales improved. Microsoft's dream of an always-on camera that listened to you and allowed you to play by waving your hands was gone, but the market itself didn't care.
The result was that prices came down, the system was more immediately approachable and players weren't being forced to pay for a peripheral with limited support that may or may not work in their home. Microsoft became a rare thing in technology: A company that poured a ton of money into a novel technology before putting the entirety of its marketing might behind it ... then ditching it in short order when it was clear the audience was not interested.
Microsoft in 2014 was an amazing example of a company learning from its mistakes and adjusting its strategy. Titanfall was a great exclusive, and the publishing deal that will give the Xbox One what is likely to be timed exclusivity of the next Tomb Raider is a solid investment.
Microsoft failed to learn the importance of having a low initial price
The vision behind the Xbox One, from the digital push to the Kinect, is in ashes, but the company continues to learn, adjust and fight back.
The story of the Xbox One in 2014 is the story of a system getting rid of all its baggage and focusing on the games While many pundits, including myself in the past, have said that this generation of consoles may have sluggish sales while justifying their price with multimedia features, players have shown that they're willing to pay for the consoles that bring the best value to power ratio and put the focus squarely on the games.
Sony has enjoyed its lead mostly due to the fact that it launched with fewer bells and whistles at a better price while providing more power, but to Microsoft's credit the company saw it had made a number of missteps with the Xbox One and worked to fix them.
2015 will begin with three very interesting systems filled with great games, the Wii U included, but it was perhaps Microsoft that had the longest and hardest road to this point. The system now starts at $350, which is a $150 drop from its release price in under two years, and Microsoft has picked up a number of strong exclusives while working toward improving the operating system and giving the system a better sense of identity without the Kinect. The Xbox One is being rewarded for these efforts with the most important metric: Sales.
Welcome back, Xbox One. Let's play some games.
This piece is part of Polygon's 2014 in Review series. Throughout December we'll be exploring the games, people and events that shaped gaming in the past year. You can check out more 2014 in Review stories in our StoryStream.