Retro gaming is going through a wild time at the moment, thanks to decompilations and recompilations that are letting gamers port classic titles to new devices, or merge code from two different games into a single new experience.
Microsoft has witnessed skateboarding being modded into Call of Duty and Halo being played in a web browser , and the company is now officially embracing the chaos of this new AI-powered era of game modding.
Microsoft is putting together a new Xbox Labs group to explore the rapid emergence of these mods, many of which use AI models to help modders remix games in ways we’ve rarely seen before. Xbox Labs will be a “small group of game makers, engineers and scientists whose job is to turn emerging ideas into things our players and developers can experience,” says Xbox CEO Asha Sharma .
“We’ll build in the open, learn from what people do, and measure success by whether more people are playing and creating.”
Sharma thinks the experiments we’ve seen in recent weeks, where Windows PC builds have been translated to run on Apple Silicon or ported to run inside browsers, “challenge long-held assumptions about our industry: the tether between software and hardware, the boundary between creation and play, and how people discover and experience games.”
“While it is hard to predict the future of gaming, it is easy to see the possibilities in making great games easier to access, giving old games new life and allowing more players to become creators and co-creators,” says Sharma. “These are unmistakably good outcomes for players, even when (and sometimes because) they challenge our existing business models.“
Modders are now doing the type of work that Microsoft has been doing for decades with its Xbox backward compatibility program, letting old games run on modern hardware. But they’re doing it without the business model restrictions that Microsoft is tied to. It’s starting to feel like we’re just a model or two away from even more breakthroughs that decouple more modern games from their intended hardware.
Sharma clearly sees an opportunity here, particularly for AI agent use at Xbox. “I think Xbox has an important role to play here,” says Sharma.
“Coding became the first major workload for agents because they can write, run, and test software. Games share many of those same properties, and people spend more than 72 billion hours a year playing XBOX games, roughly five times the estimated time spent writing code worldwide.”
Xbox Labs is clearly a way for Microsoft to experiment with how AI will shape where games are played, and Xbox will share any tools and learnings with developers. The bigger question is how Microsoft will respond to decompiles and recompiles of games where modders take its precious IP and make it freely available.
Modding is fun, but I can’t see Microsoft and other publishers seeing the fun side if modern console games start to appear where they shouldn’t.
I asked Microsoft to comment about unauthorized IP use, but the company didn’t respond in time for publication.
Here’s Sharma’s full memo:
Team,
The first video games emerged some 75 years ago. In the time since, there have been booms and busts, but every year there are more great games to play, more devices to play them, and best of all, more people than ever playing.
That growth helped make XBOX what it is today, and we’ve helped shape the industry in return, from bringing hard drives to consoles and online gaming through Xbox Live to Game Pass and cloud gaming, alongside franchises that have brought millions of people together.
In recent weeks, we’ve seen games rapidly decompiled and rebuilt to run on hardware they were never originally designed to support. Windows PC builds have been translated to run on Apple Silicon or ported to run inside a browser through WebAssembly and WebGPU, the latter now approaching 90% global browser support.
Perhaps more surprisingly, we’ve seen many of the biggest games in the world have been remixed into the source code of another.
These experiments challenge long-held assumptions about our industry: the tether between software and hardware, the boundary between creation and play, and how people discover and experience games. While it is hard to predict the future of gaming, it is easy to see the possibilities in making great games easier to access, giving old games new life and allowing more players to become creators and co-creators.
These are unmistakably good outcomes for players, even when (and sometimes because) they challenge our existing business models. To explore these possibilities, I’ve asked Scott to stand-up XBOX LABS, a small group of game makers, engineers and scientists whose job is to turn emerging ideas into things our players and developers can experience.
We’ll build in the open, learn from what people do, and measure success by whether more people are playing and creating.
I think XBOX has an important role to play here. Coding became the first major workload for agents because they can write, run, and test software.
Games share many of those same properties, and people spend more than 72 billion hours a year playing XBOX games, roughly five times the estimated time spent writing code worldwide. We’ve spent 25 years learning how to make great games, and I want our game makers to help shape what these new technologies make possible.
As we learn, we’ll share the tools we build with developers across the industry, just as we always have.
Our priorities aren’t changing. We remain committed to the 4Cs, to making great games, to our hardware and to being responsible stewards of IP and the communities built around it. LABS gives us a way to explore new technology without abandoning the work already underway.
Asha
