Phil Spencer says Xbox Keystone was scrapped because "it was more expensive than we wanted it to be"

Xbox's streaming box Keystone was scrapped due to it being "more expensive" than the team wanted it to be.

Last month Xbox boss Phil Spencer shared a photo of his shelf which contained what looked like a tiny version of the Xbox Series S. It later turned out that this was actually a prototype of the company's upcoming streaming box called Keystone. As we now know, Keystone has since been scrapped, and in a recent interview with The Verge's Decoder podcast, Spencer gave an insight into the product's development.

When asked about the product, Spencer said: "The console we built, that now people have seen [Keystone]. It was more expensive than we wanted it to be when we actually built it out with the hardware that we had inside." Elaborating further on this, Spencer explained that with the Xbox Series S priced at $299, and even less during the holiday season, the Keystone would have had to have been a lot cheaper than the Xbox Series S, and obviously much cheaper than the Xbox Series X.

Article continues below

"I think in order for a streaming-only box to make sense, the price delta to S has to be pretty significant," Spencer said. "I want to be able to include a controller in it when we go do that," he continues, "it was really just about whether we could build the right product at the right price." Instead of pursuing the Keystone, Microsoft decided to focus more on the Xbox TV app with Samsung - which Spencer says the team is "really happy with."

So how much would the Keystone have to cost in order to go to market? Well, as Spencer also revealed in the podcast, the streaming console would have had to have been priced at around $99 - $129, which if bundled with a controller, just wasn't financially feasible.

The CEO of Microsoft Gaming clearly has a soft spot for the little box though, hence why it's on his shelf: "I love the effort. The reason it’s on my shelf is because the team rolled up their sleeves and in nine months they built that thing. A bunch of us took it home and it worked. It worked really, really well." Unfortunately for the rest of us, it just wasn't meant to be.

Still enjoying your Xbox console? Take a look at our upcoming Xbox Series X games list to find out what you can look forward to playing soon.

After studying Film Studies and Creative Writing at university, I was lucky enough to land a job as an intern at Player Two PR where I helped to release a number of indie titles. I then got even luckier when I became a Trainee News Writer at GamesRadar+ before being promoted to a fully-fledged News Writer after a year and a half of training. My expertise lies in Animal Crossing: New Horizons, cozy indies, and The Last of Us, but especially in the Kingdom Hearts series. I'm also known to write about the odd Korean drama for the Entertainment team every now and then.