Microsoft reflects on Kinect

Today, the industry-tracking NPD Group released its US retail sales figures for the month of November, which showed the Xbox 360 to be the best-selling console in the country for the sixth month running. That run started with the unveiling of the redesigned Xbox 360 at June's Electronic Entertainment Expo and was bolstered by last month's debut of the heavily hyped Kinect motion-sensing camera peripheral.

Microsoft's group product manager for Xbox, David Dennis, took time to talk with GameSpot today about the system's run atop the charts, the Kinect's retail debut, and third-party appraisals of the peripheral's performance. Dennis also addressed how the camera fared upon its launch in Japan, a market Microsoft has struggled to succeed in ever since the original Xbox's release.

GameSpot: How are the Kinect software attach rates looking?

David Dennis: They're good. I don't have an exact number. Our data guys are still poring over everything, and attach is one of those ones that's not right there. You need to do some calculating to parse out Kinect games versus others. In general, we've got quite a few of the Kinect games in the top 15-ish overall, so we feel really good about just the general basket attach we saw overall at retail.

GS: Of the 1.4 million 360s that were sold, do you know how many were Kinect bundles?

DD: We do, but that's not a number we break out. That's just a historical thing. We just never have. We've never said, "this many Arcades," "this many Elites…"

GS: Can you say anything about the ratio of first-party software sales to third-party sales?

DD: I haven't actually seen that data come through from the guys chewing over the NPD stuff. But the feedback I've heard anecdotally from third parties was that getting to 2.5 million in the first 25 days blew their expectations away. For third parties, it's all about the installed base and how many people out there would be wanting to pick up your software. So if you built a Kinect-specific game for launch--I think to see that we've invested to the level we have and moved 2.5 million units--I think third parties are generally pretty excited about the potential for Kinect. And you'll see that reflected in the sales for third-party games.

Microsoft Game Studios built four of the titles--some were second-party published by us, and some were pure third party. Some we knew were going to be breakout successes, like Dance Central and some of the games we've showcased at our various events over the last year and a half or so. In general, I'd say we feel really great about the momentum we've got fueled by Kinect and the catalyst for growth it's pushed for us this holiday.

GS: Were there any games that surprised you with how well they did?

DD: No, I think our guys that manage the third-party portfolio have a pretty good gut for what's going to be a big success and what may be just an OK game. I think the games we saw showcased--Dance Central or Your Shape by Ubisoft--I think generally those have been the highest-performing games, because our team certainly has a good eye for it.

GS: This makes six months at the top of the console hardware race. You've been on top before, so how long do you expect this run to last?

DD: Well, I would sort of flip that and say I don't see any reason why it wouldn't continue. For us, it's about continuing to innovate and bring new experiences to the platform through Live, bringing Netflix, Facebook, ESPN… We're always talking to partners about ways we can bring other types of entertainment experiences, as well as reinvent the platform overall so it continues to feel fresh and new. And you couple those Live services with amazing games. The more services, games, and experiences you bring to a platform, the more reasons you give people to buy it, but also to turn it on day after day. To the extent we can continue to do what we're doing, I think the trajectory is poised to continue.

Obviously, because of the [NPD] rules, I'm not able to give out anybody else's numbers, but I can say we're the only console showing double-digit growth. We feel great about where we're at, and we wouldn't trade places with anyone at this point.

GS: Do you expect the 3DS launch to have any impact on console sales when it comes out?

DD: Obviously, you're looking at share of wallet. And I think a lot of it comes down to what the games are that are coming with it. It's a steeper price point than the regular DS was, so we'll see. We've got some folks on our team here who are former Nintendo folks, and it's interesting talking to them at the watercooler. What they've said is that typically a handheld purchase is an individual decision, where a console is more of a family decision. So the consumer purchase behavior goes through very different approvals and blessings needed.

GS: I know the Japanese market has been problematic for the Xbox since the original system launched there. How's the Kinect faring in Japan so far?

DD: It's good. It's doing as expected. Obviously, it's a challenging market. We continue to invest there and feel good about where it's at. And I would say Kinect is mirroring as we had expected to do based on the installed base there. They had a solid launch from everything I was able to see and observe. The team there feels very confident in what they're bringing to market with the games and experiences specific to the Japan market. So we'll see. I haven't seen hard numbers, but I know anecdotally the team feels pretty good about it.