Bach spins 360 progress

Microsoft's entertainment and devices division president talks Halo, price cuts, original IPs, and why the company lost billions--and didn't buy Nintendo.

In a newly published interview with the San Jose Mercury News, Microsoft entertainment and devices division president Robbie Bach discussed the company's attempts to break into new markets with the Zune portable music player and its television content over broadband networks service, IPTV. Naturally, Bach also spoke about Microsoft's last big push into a new market with the Xbox and its follow-up, the Xbox 360.

The Xbox 360 started the transition to the next generation of gaming systems with its release in November of 2005, and was recently joined in the market by Sony's PlayStation 3 and Nintendo's Wii. While some expected the software giant to drop the price of the Xbox 360 to steal some thunder from the new arrivals, Bach told the Mercury News it wasn't a tough decision to keep the system's two versions at their launch price points of $299 and $399.

"When your competitor is supply constrained, it's not clear what price buys you," Bach said. "Let's be clear, Sony is going to sell as many units as they can ship in the US... I don't know that a lower price would make a difference in the outcome."

Despite that, the cost of an Xbox 360 is still a big concern for Microsoft. When asked if Microsoft was already cooking up the next generation of the Xbox line, Bach said the engineering team was always thinking ahead, but the "first order of business" was to get the manufacturing costs of the 360 down. According to a recent survey by electronics-research firm iSuppli, Microsoft is currently turning a $75 profit on each 360 unit, up from a $126-per-unit loss at launch. Microsoft's Xbox division has lost money every year since its inception, but Bach previously said he expects it to turn a profit in the company's 2008 fiscal year. According to the Mercury News, the Xbox and Xbox 360 have cost Microsoft a net loss of $3.8 billion to date. The paper then asked Bach if there was any limit to the amount Microsoft was willing to spend to establish itself in the gaming world.

"The amount of investment, in particular on Xbox, has been a large number," Bach said. "So, compare that to the alternatives and some of the alternatives would have been, 'Well, go buy somebody big.' So, you could have looked and said, 'Go buy Nintendo.' And Nintendo at the time would have been a $15 billion acquisition. So, by any stretch of the imagination, a much bigger investment."

Finally, the paper brought up the hit Halo franchise--recently expanded with the announcement of its first spin-off, the real-time strategy title Halo Wars--and asked why Microsoft "hasn't exploited Halo the way that Electronic Arts would."

"The balance we have to strike with a property like Halo is taking advantage of the intellectual property itself and not wearing out the franchise," Bach said. "Electronic Arts has an advantage in a way with sports where it is self-renewing. And it's not even their doing. It's the nature of the sport, with new players, new stadiums, and new teams.

"In something like Halo, you have to look at how do we maximize the intellectual property. We could do eight things, but that's probably too many. It's also important for us to have more than just Halo. That is why Viva Piñata is important. That's why Forza Motorsport 2 is important. It's why Project Gotham Racing is important. It's why Gears of War is important. It's important for our first-party group to have a range of titles."

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295 comments
matty_sen
matty_sen

"halo 3" man,will it fill the hype! is just a month away i haven't herd any gameplay themes like tactical play or 100s of weapons and is just next month

charlietuna720
charlietuna720

Relative to the huge losses on the Xbox consoles, I wonder how much Microsoft has profited from Xbox Live and exclusive game sales and downloads. My guess is that, other than the consoles, they are doing pretty well.

redsnake9111
redsnake9111

He seems to not really care about making enjoyable games. Just to break open new markets. I think there needs to be a change of focus in Microsoft. First they should think: Let's make a kick-a** gaming system that blows the competition away! Then they should think: And we'll make money off of it two! providing new jobs for people and advancing computing technology in the process. But no. This is what true capitalists should think. This is why I hate Microsoft in a nutshell.

Shadow_Fire41
Shadow_Fire41

Yoda: 'looking at staff of this game' release this game this year you will. Staff: maybe. Yoda:......crap

Evanrocknuma
Evanrocknuma

I am more excited for halo 3 but I already know the basis on how it will be played... however I am more interested on how Halo wars will turn out. The peter jackson part scares me though. He wants to make the game PLAY like a MOVIE, wait did he just combine those two words... oh god. If you guys havn't noticed he kind of screwed up the story line of king kong and goes a little overboard on digital animation which most ppl would think is good but no If you go to high above the bar it ****s up the story line and can make the game pretty much unplayable. For instance I watched my friends dad play Dreamfall which was pretty much the same concept to add a movie feel to a game... yea good and great but I was up there for like an hour and only saw cutscenes after cutscene. Too much movie for my taste. Hopefully since he is the lord of the rings film creator he will make this game play a bit more like battle for middle earth 2 but better because I am still debating whether I want to pay 50 bucks for an RTS that can get boring after a while and the camera can not zoom in far enough... but I cant really complain either because it is probably one of the best games out of its kind. Halo wars here is my tip go for more of that feel but better get it? than you will have a better game that doesnt have cutscenes as long as it took me to freaking write this. XD

Shadow_Fire41
Shadow_Fire41

it would appear that there are alot of Spartans, not just Master Chief......sweeeeeeeet!

gforce007_basic
gforce007_basic

You guys are even bigger morons than gates and ballmer if you think being rich qualifies you as being intelligent. The fact remains, there are more creative and more talented people in the computing industry who have done a lot more for it than they have.

mansmanman
mansmanman

HAHAHAHAHA, lawn mower, that's about right Grand17. I do think there is a bug difference in the systems....

matty_dub
matty_dub

Let's not forget about Bethesda and Blizzard now... You can truly tell that they sacrafice some of their money and time to create their masterpieces. Even though I understand no corporate company is peaches an' cream, they seem to be lesser of evil... Along w/ the designer of Halo, im glad he hasn't over-franchised Halo (too quickly). Can't wait too see how this Halo Wars turns out... ************************************************************************************* all of you ignorant people who keep knocking on corperations are wasting your breath and making everyone more and more ignorant with every word that escapes from your mouth. There are a few things that you need to realize and accept. 1. Making millions of dollars is the "American Dream" in most people's eyes, so if they want to spend their entire life building a corperate empire then that is their business, if you want to sit around and play nintendo the rest of your life and life in the middle class then feel free to do so. Stop ripping on everyone's life decisions and worry about yourself. 2. If you are going to rip on the gaming companies about giving people what they want (more sequels to popular games) then start your own gaming company and make people wait for what they want....not a very good business plan but your decision none the less. 3.To automatically say that corperations are evil is extremely ignorant due to the fact that i garauntee that you do not know one corperate CEO....Do not judge unless you know. In addittion to that most folks do things for one good thing or another, while you may see making a lot of money as trying to take over the world and screwing people over they may just be trying to feed their 35 illegitimate children.....you just never know so keep your incoherentness (probably not even a real word) to yourself as to not infect vulnerable minds. I could probable go for days but i would like to hear a response. What do all of you people think? Are your most pressing issues in life really trying to tear down corperations that are only that big because someone wpent their whole life building it from scratch. Or may it is the fact that some of you have nothing better to do than sit on your backsides, play great, innovating games, and then find the smallest of reasons to rip apart someone's hard work. I apologize to whoever it was that i quoted, this is not a direct attack on you what so ever. I just quit smoking cigarettes and drinking so i a little cranky and had to vent somewhere Chillin Matty Mcgee

grand17
grand17

ps3 may be the size of a microwave but xbox360 is louder then a lawnmower neither system is much better then their predecessor

cenz_is
cenz_is

looks like Microsoft knows what their doing

kujel
kujel

The console makers are all after money so are the game publishers and some of the people involved in making the games but there are still people who just love games. I'm currently studying programming so I can get into game design and it has nothing to do with money. I agree that it's good M$ didn't but Nintendo: the competition is good and the Xbox line is great. From what I have seen the PS3 cost way too much and doesn't do things as well as the Xbox 360, the WII has a neat but novel interface and most of their games are pretty sad (poor graphics, game play and control schemes). I think this gen M$ has it in the bag and we may see Sony drop out of the industry or maybe Nintendo (that would depend on who takes second place). I see it takes four things to make a great game: great game play, great control scheme, great story and great graphics/art (in that order). In the end we'll see what happens but I would bet money on M$ going out on top this time round.

monkkito
monkkito

ricsuave gforce007_basic Bill Gates and Steve Ballmer are complete retards. ============================================================= Yet they are worth about 100 billion dollars more than you are from a company they built and developed from scratch. Hmmmm, so what would that make you..........? ************************************************************************************* LMAO!!! good point.

ricsuave
ricsuave

gforce007_basic Bill Gates and Steve Ballmer are complete retards. ============================================================= Yet they are worth about 100 billion dollars more than you are from a company they built and developed from scratch. Hmmmm, so what would that make you..........?

feartrain999
feartrain999

Let's not forget about Bethesda and Blizzard now... You can truly tell that they sacrafice some of their money and time to create their masterpieces. Even though I understand no corporate company is peaches an' cream, they seem to be lesser of evil... Along w/ the designer of Halo, im glad he hasn't over-franchised Halo (too quickly). Can't wait too see how this Halo Wars turns out...

Raven87
Raven87

Please will everyone stop thinking that these companies are anything other than that. Yes there are individuals in those companies that love making games. But the companies themselves (including Nintendo whom people seem to think are the only saints in a pool full of sinners) are not trying to make great games for your enjoyment, they want you to give them your money to enjoy great games. Though it is nice to see the 360 console starting to give a return so early in its' lifespan. Yes I knows its' hypocritical to say that after the first stuff.

gforce007_basic
gforce007_basic

Having read the Businessweek article about J. Allard in addition to the Robbie Bach interview, M$ has made the right moves but for them to think they could have bought Nintendo is completely laughable. Nintendo would refuse to be bought, no way in hell they lose their creative independence. I would have liked to see them try but I really question their thought process, thinking that they could actually buy Nintendo. Even worse, they thought they could make a game system run a version of windows and then get Dell to build it lol. Absolute nonsense. Bill Gates and Steve Ballmer are complete retards. If anybody helps Microsoft survive through the Google Age of Computing, it sure as hell wont be those two buffoons.

Virus013
Virus013

Hey, there are still developers out there and video game designers who don't do it for money, I know personaly quiet a few.

ryokinshin6x3
ryokinshin6x3

its a business, they really dont giv a **** about valuing customers unless it gives them more money, stop dreaming about the "good" corporation

Virus013
Virus013

Yeah right now the bigest thing they are working up in this time of the season is "who makes the most GROSS in the buisness side of these things." Though PS3 is very hot right now, they have two things going against them: lack of systems to ship which take time to build and ship in bulk out of the factory and console and game issues. To be honest, I think Microsoft isn't going to lower down for any reason theat price of 400.00 because you are getting for a very good and balanced system for the price you are paying for. In addition to it being next Gen ofcourse. But hey Gsk, on the bright side it cost developers already as it is allot less to make next gen games on the Xbox plus I hear they have better and easier tools. Hopefully we will see this in the next few years.

riccochet
riccochet

gsk, I'm sorry to dissapoint you, but it's always been about making money.

gskehans97
gskehans97

Ok...Buying out Nintendo sounds REALLY good! but is makeing money every thing now?? It's about makeing Great Video Games for all us GAMERS! Sure...i'd love it if Microsoft bought them out! more money for them, that's what they want. us as GAMERS Hopefully we will get great games for our Consoles and/or handhelds....

GloverD
GloverD

"microsofts plan and vision is great -windows live, zune, x360, vista" Sorry M8 But Zune will never beat the iPod, and Vista is going to be the hackers dream of **** it up even more. Ill stick with XP. 360 is a great console but none the less isnt a big step up from the XBOX1, All i see is 3 core processors and wireless technology. nothing special i see a new console coming out by 2008-09 seeing how the og xbox only lasted 4 years.

VengenceZero
VengenceZero

exactly, the PS3 is the size of a microwave

Sacif
Sacif

I think that their ideas are good, they aren't trying to exploit the market by making a zillion spin off games. I like their attitude, but either way, I just hope they drop the price of the 360.

lavalleema
lavalleema

Heh, on the topic of Sony Fanboys I have to admit I think it's hilarious that no one's said anything about the sheer SIZE of the PS3. For years I've heard constant trash talk from Sony Fanboys about how "I'd never own something as large as the Xbox" and the like. Now, however, the PS3 is larger than the original Xbox and the Xbox360. Yet no one is saying anything.... hmm... I'm with Pathogenb: "Do yourself a favor and play more games, be a retarded fanboy less." I couldn't have said it better. I'm a fan of playing games, who cares what system they are on as long as you enjoy it. Geez....

pathogenb
pathogenb

"What a great achievement GoW was.. its a game full of gimmicks! " it is a great action game. do yourself a favor and play more games, be a retarded fanboy less. way to go, Sparky!

nikefreak
nikefreak

"its a game full of gimmicks! " lol... I smell a Sony fanboy. You want gimmicks? Go for the PS3. Ripoffs galore on that console, including the waste of time and now canceled GT HD. rofl... Not a single Sony fanboy should be talking at this point. Their system is getting worse by the day, not better like the 360 has consistently done.

Psycho_Teen
Psycho_Teen

you ok there brainmckenna? Anyways I think ms should buy bioware or konami if they were going to buy another company, Sega is a little to much.

brainmckenna
brainmckenna

Finally, the paper brought up the hit Halo franchise--recently expanded with the announcement of its first spin-off, the real-time strategy title Halo Wars--and asked why Microsoft "hasn't exploited Halo the way that Electronic Arts would." "The balance we have to strike with a property like Halo is taking advantage of the intellectual property itself and not wearing out the franchise," Bach said. "Electronic Arts has an advantage in a way with sports where it is self-renewing. And it's not even their doing. It's the nature of the sport, with new players, new stadiums, and new teams. "In something like Halo, you have to look at how do we maximize the intellectual property. We could do eight things, but that's probably too many. Maximize the intellectual property.. they are just clinging to halo because its such a simple game... if they were any good they would have made a new story by now like quake 1 to 2. What a great team bungie is... with Halo 2, they implimented shot-assist! That is why Viva Piñata is important. That's why Forza Motorsport 2 is important. It's why Project Gotham Racing is important. It's why Gears of War is important. It's important for our first-party group to have a range of titles." WOW WHAT A RANGE OF TITLES!!! What a great achievement GoW was.. its a game full of gimmicks!

MonkeyMangler
MonkeyMangler

I'm with pants... i own every sega system and 79 genesis games and countless others... sega is the video game god... micosoft should've bought that god...

PantsOfFury
PantsOfFury

I still say Microsoft should have bought Sega... then I never would have had to suffer seeing Sega games on a Nintendo or Sony system. Now that the Sega Fanboy in me has had its say I just think it's nice that Microsoft is actually making a profit for each console it sells now rather than losing money. Making a step in the right direction is always nice.

RaiKageRyu
RaiKageRyu

Hmm, that's a good way to think about things.

Maarz
Maarz

Raven754: ""Yeah because the last thing anybody wants is graphics.WTF! are you really that stupid? nintendos would sell double time if they played half decent games and had decent graphics. The world could be theirs within the week but oh no they want to be innovative. "" We've got sony and microsoft to give us graphics and badass games, nintendo is there to do everything else.

Kholdstare_fire
Kholdstare_fire

Owned at sucking, rofl. wewt M$! Next zune will take over the mp3 market.

sinceps1
sinceps1

I wish they would get Starcraft Ghost published on the Xbox360. But then they probably don't want PC gamers on the Xbox 360? I heard they finished the game and then didn't publish it which is wack.

Deckarus
Deckarus

Microsoft haves the momentum, I just hope their execs. keep moving in this aggressive manner, and they will win. And we (the gamers) will have a a lot of fun. :P

PSP360Gamr83
PSP360Gamr83

microsoft was looking at buying out nintendo to build the first xbox according to j allards article in newsweek, im very glad they didnt because microsoft has done a great job with the console.

GFofgaming
GFofgaming

U have to admit, 360 is really building up its First party titles brilliantly. GOW was lucking F***** HELL. I bet same thing with Mass Effect, Splinter Cell 5, HALO 3, Alan Wake all will come next year.

tH3_cH3a7_027
tH3_cH3a7_027

yeah it owned at sucking. go 360 and Wii!!!!!!!!!!!!!

kampz1
kampz1

[This message was deleted at the request of a moderator or administrator]

gam3r3OOO
gam3r3OOO

Microsoft has put itself firmly in the market, with lots of advertising etc. Sony with its woes and expensive system is likely to do worse than expected. Nintendo seems to be the only big competitor with Microsoft this generation of games. If Microsoft had bought Nintendo...I would hate to think what would happen to gamming. Maybe it would be for the better. Maybe it would be for the worst. But one thing is for certain: competition makes for better games period! If Microsoft bought Nintendo I think the quality of games would steeply go down as Microsoft wouldn't have to try as hard to get more consoles sold and quality would go down just like we have seen with EA. Just think if EA had an equal competitor how much better their games would be.

Hoopin4thelove
Hoopin4thelove

microsofts plan and vision is great -windows live, zune, x360, vista unlike the crappy ea but much like the genius upstart company we all know and love they are headed in a new direction and if you can see it u will soon. p.s check out j allards news week article

Jerian
Jerian

Heres my confession, I was very skeptical about Xbox1. Partly as I had a general dislike of Microsoft, & partly because the system seemed like a watered down gaming PC (Which in all fairness it was) not a console in the traditional sense. I was much happier at the time enjoying my games on PS2 & Gamecube. I knew that Halo was a great game but no other title really stood out from the rest of the lineup and got my attention. It took awhile for Microsoft to make good on their initial promises for the system but once games like KOTOR & Panzer Dragoon Orta came out I realized these were titles that were not possible on my beloved PS2/Cube. In time I was hooked & found myself waiting inline with hundreds more for Halo2 at a midnight release at EB. I realize now how much I would have missed out on as a gamer if Microsoft had not entered the race. It would not have been the same if they had simply bought out Nintendo. Nin makes some of the best games on earth but they are not Halo/Gears Of War. Also having Western influence/competition on an otherwise Japanese dominated Market was much needed. Likewise id like to see more influence from Japan on my other platform the PC. Each culture has its own unique artistic influences that are Both needed for the games we love. Love em or Hate em X is here to stay.....That being said, am I the only Gamer who would love to see a console from Apple in the mix. I mean look what the POD did tor the portable music scene!

kamicolo
kamicolo

Halo spin-offs / merchandise: I've seen the graphic novel / comic book, action figures, busts, posters, t-shirts, stickers, of course games, cardboard cut-outs, movie is on itz way As long as there is no Halo fighting game(Onimusha melee game) or racing game (Crash Team Racing...), I think Halo spinoffs will be fine

mynamesdenvrmax
mynamesdenvrmax

Its simple for me, the xbox 360 has MUCH more that I want, for the right price. PS3 doesnt offer what I want out of a gaming system. I dont like their games, their business plan (especially now) and their price quite unfriendly. While the Wii on the other hand offers too little, but has a decent price tag. I think anyone whos really buying a PS3 right now either: 1. Wants to sell it 2. just wants to be the "first"/ I mean..who is really that excited about their game line up this time?

Impostorzim
Impostorzim

I know one thing out of all of this. If Microsoft buys Nintendo, You'll be looking at a really depressing age when the same company as Windows has rights over Mario. I don't think I could bear to play Halo anymore. I think Game Companies should stop taking leaps. Its really scary, and in the end its all about the money.