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Microsoft readies for hot holiday video game season

Last Updated August 30, 2007

Summer isn't even over yet but the video game companies are already ratcheting up Christmas hype. Microsoft Corp. this week held its annual "X" show in Toronto to preview the games it will be releasing over the next few months for its Xbox 360 console. Jeff Bell, the company's corporate vice-president of global marketing, discussed some of the releases and the company's strategy going into what will be a heated holiday competition against rivals Sony Corp. and Nintendo Corp.

How important is Halo 3 for Xbox and Microsoft's ventures outside of its core software business?

Halo 3 The hotly anticipated Halo 3 is the third instalment in Microsoft's flagship video game franchise.

Halo 3 is the biggest franchise in the history of video games, and we say that based on the success of Halo and Halo 2. This is the end of the trilogy and the third time is a charm. We want everyone to know that you don't have to play the first two games to enjoy the third, and the third is the most expansive, the most graphically stimulating. It has a lot of cool features like four-person co-op and multiplayer online experience.

What it means for us as a business is it not only demonstrates the technical capability of the Xbox 360 and our online community Xbox Live, it also continues to grow the consumer base that is purchasing and participating in the Xbox 360 family. Our tagline is "jump in" — it is an invitation for everybody. Whether they define themselves by playing games or just play games occasionally, Halo is one that shows the true breadth of story-telling capability and the technical prowess of the platform.

This has been an interesting year in gaming, with the success of the Nintendo Wii and games like Guitar Hero 2, both of which have brought in a non-traditional audience. Where is Microsoft going in terms of that direction?

This predates me because I've only been with Xbox for 15 months now, but the first generation was about getting credibility. We're the newbie. Our competitors have been at this — one of them for almost a hundred years of games in one way, shape or form. I think we got the credibility with the first Xbox.

The Xbox 360 has a very thoughtful plan, which is to continue to expand our appeal to more and more people while clearly maintaining our credibility with the hard core, but also expanding into more casual game players. You do that through the games themselves.

Mass Effect Mass Effect is the latest role-playing game from Edmonton-based BioWare.

Sports is critical for us. Here in Canada we have a huge commitment to the NHL franchises with Electronic Arts and 2K sports. We're also expanding into role-playing games, this holiday in particular, with Blue Dragon launching today [Tuesday] from Sakaguchi-san, the creator of Final Fantasy. Canada's own Bioware is going to launch what I think may be the biggest role-playing game of this holiday season, Mass Effect.

In the racing genre, Forza 2 has already been a success and Project Gotham 4 is coming out this next month in September.

So what you see is a very clear commitment on our part to say we have games for everyone. Xbox Live Arcade, whether it's Bomberman Live, which we just launched, Sonic the Hedgehog, retro games as well as new games, they're much more accessible. We've got games of every genre, of every variety.

Are games becoming more social?

We clearly believe that people should have a party in their homes. We don't see gaming as a solitary event. Whether it's Halo 3 with four-player co-op at the same time or it's our strong partnership with Guitar Hero 2 and now 3, and the anticipated Rock Band coming. We're launching Scene It with the new big-button pad controller, four of which come with the game. That's to encourage people to have a social experience. Viva Pinata Party Animal will also have four people playing. It's a very fun pick up and play game, with 50 games on one disc.

That's in the living room. With Xbox Live and seven million members, you can be by yourself in the living room but you can play with unlimited people around the world. We're excited about adding to the Vision camera and the Windows Live Messenger chatpad, which is the Qwerty pad that clips into the controller so you can do text messaging. So for us, clearly getting out of the home — people having all these Guitar Hero parties and celebrations — our retail partners are excited. Whether it's at a bar or other social activities built around games, all of those things are really focused on the joy of gaming.

You mentioned Nintendo's Wii � its success has surprised even Nintendo. But I'm thankful that they've demonstrated that people love to play games, because games lead to joy. They help with self-esteem, they help you connect socially. We want a robust economy of gaming so we're thankful that we've got good competitors like that, who are showing that everybody likes to play.

This holiday season is going to be the real first clash, where all three next-generation consoles are well established. How much of an advantage do you have with the one-year head-start, and do you see bloodshed coming this Christmas?

We have very specific goals and we're playing to win. We do wish to sell the most consoles and we're already selling the most games. We're actually outselling both of our competitors on games where they're available on all the platforms. So this holiday, we feel really good.

Here in Canada just recently there was a price change [on the Xbox 360]. We learned from our first-generation experience that you do need to have an appropriate pricing strategy over the life cycle of the console to be able to grow that install base, which allows third-party publishers like an Ubisoft or a Bioware to succeed on our platform. We also have to expand the types of games you have available.

You've seen in Canada that bundles have been very successful so we'll probably stick to the things that work for us. So you'll see more value and more choice as well as what is without question the biggest blockbuster lineup of games.

How important are exclusive games to a console's sales? In this day and age, how do you convince somebody like an Electronic Arts to produce an exclusive title for you? Or does that not happen?

A lot of it is frankly economics and the success of your platform. This is one of the things that is different from our first-generation to the Xbox 360. Bioshock is exclusive to the Xbox 360 and Games for Windows. We were terribly excited with our growing partnership with Namco Bandai. Beautiful Katamari, which is also going to be super-fun casual play and family game play, is going to be exclusive to the Xbox 360 for the first time. Ace Combat 6, a game we haven't talked a whole lot about from Namco, is exclusive to the Xbox 360.

They're doing that because they're in the business to be successful and make money and they see we have the largest install base and that we have the greatest opportunity going forward of selling more consoles. Nothing succeeds like success is the old adage. Before we probably had to convince people to develop for our platform <…> but we've put a lot of time into serving the development community. I think they find it easier to make their games on Xbox 360 and right now we see some of those advantages in complete exclusive or time-bound exclusive because they're able to launch with us earlier than they can with our competitors.

What does your new boss bring to the game, no pun intended?

Obviously it's an honour to work for a Canadian, Don Mattrick coming over from EA and most recently Prometheus Software. He knows the game business. I think it's so exciting that he was an entrepreneur, founding his own software game development company in Vancouver and then later running EA's software and game development business. He gets it and this is the time for us to focus on flawless execution.

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