Q&A: Microsoft Australia talks Halo 3 sales figures

It comes as absolutely no surprise to anyone that Halo 3 is eating up and spitting out the Australian game sales charts. According to independent retail tracker GfK Australia, in just its first six days of sale, Halo 3 generated A$7.5 million in software sales in Australia, and A$9 million in revenue including accessories. The game has sold 70,000 units, which lets it sit comfortably in the second highest-selling Australian Xbox 360 game spot since the console's launch last year.

We caught up with Nick Segger, Microsoft Australia's Xbox marketing manager, to discuss Halo mania, the effect on console sales since the Australian price cut, and where Master Chief hangs out in his spare time.

GameSpot AU: Xbox 360 hardware sales increased by 55 percent over the week ending September 23. What sort of sales increase has Microsoft seen across all SKUs (stock keeping units) since announcing an Australian price cut?

Nick Segger: What we've seen since the price cut is that our sales have built week-on-week. Off the top of my head it's in the 160-170 percent increase since the price drop. It's gone up significantly based on, obviously, the price drop. The Core system has performed really well at the same price at the Nintendo Wii, but we also launched the Xbox 360 Elite SKU and the Halo 3 limited edition SKU as well. The Pro SKU continues to be the bread-and-butter of the business, and it's probably 50-60 percent of the business.

GS AU: You've said the Core system is very strong here. What are the plans for Australia receiving the Xbox 360 Arcade system?

NS: I don't think we've got anything specific to announce on that at this point in time either here or globally. The Core for us is still going well as it stands, particularly around the mass merchants, the Targets, the K-Marts and the Big W's. So we're still focusing on that product at this point in time, on any other SKUs around that price point.

GS AU: What, if any, are your plans for an Australian Xbox 360 hardware bundle with Halo 3?

NS: I can't tell you anything about that. Halo 3 is doing a great job of selling systems for us, as you've seen from the stats; our console sales in the week Halo 3 launched went up 55 percent. Halo 3 is doing a great job of selling itself to the install base as well as selling consoles for us. The other thing about that is that our whole view around Xbox is choice for consumers, so forcing people to buy things is something we try and avoid at all costs. HD DVD is a good example of that--choose to upgrade when you want. There's nothing specific around any Halo 3 bundles, the stats speak for themselves, and it's a great console and has been selling a lot of games for us.

GS AU: So why then was Halo 3 not bundled with the limited edition Halo 3 console?

NS: The reason we chose to do that was that we had three specific Halo 3 SKUs. We wanted to make sure that people could get the SKU of Halo 3 that they actually wanted rather than forcing them to put a specific SKU with the console. The decision was made around that, that we wanted to put a console out there that was a limited edition offering that was to mark the entertainment launch of Halo 3, but still give people the choice to pick up the SKU whether it was the standard, the limited, or the legendary that they wanted the most, rather than forcing the decision on them.

GS AU: What is the current SKU sales breakdown on various versions of Halo 3?

NS: The legendary is pretty much gone now; everything we brought in was presold for launch.

GS AU: How many units was that?

NS: Probably in the region of ten and a half thousand, somewhere around that. The legendary probably represented about 12 percent and then standard and limited were split pretty much 50/50. So it would be 40-45 percent on both those two other SKUs--the standard and the limited--and the legendary took up the rest.

GS AU: Halo 3 has sold 70,000 units in its launch week, already making it the second-best-selling Xbox 360 title. Is that behind Gears of War?

NS: Yes, that's right, Gears is the number one title, obviously that launched last November. Over the weekend, we'll surpass Gears of War sales, so it will be the number-one-selling Xbox 360 game.

GS AU: What sort of forecasting has Microsoft done for Halo 3 in terms of predicting run-on effects to both hardware and software sales?

NS: We expect Halo 3 to continue selling well through the Christmas period. So you will have noticed (or maybe not noticed) that our advertising campaign on Halo 3 hasn't kicked in fully yet. There's a lot of stuff to come on Halo 3. We expect that will continue to sell really well and drive console sales, but again when we look at the slate of games we've got lined up between now and Christmas, some commentators have said that it's the best lineup of games that has ever happened in that type of period. We expect games like Halo 3 along with games like PGR4, Mass Effect, Call of Duty 4, Assassins Creed, as well as some of those more casual games, like Scene-It, which is coming in November, Guitar Hero 3, all those games will continue to drive Xbox 360 sales between now and Christmas.

GS AU: Why was Halo 3 such a low-key launch compared to Halo 2? You said you'll be ramping promotion for it, but why did you wait until after it launched?

NS: We specifically made the decision on Halo 3--there was a lot of hype and awareness and anticipation for the title on a global basis building up to the launch anyway. What we really wanted to try and do was really think about this as not just as a game launch, but as an entertainment launch. Specifically, we built a campaign around that, but we're looking to bring people into Xbox 360 from the gaming category with Halo 3 after launch, [people] who might not have not have necessarily come in had we spent a lot of our money on day one. We're looking for some longevity in the campaign and to bring people into it, and I guess having played it yourself it's a pretty special game in terms of single-player experience and the epic nature of that. But also the multiplayer side of things, just because it is so easy to use and there's so many different multiplayer functions in the game that we think this is a great opportunity to not only get people buying into buying Halo 3 on a console, but also get onto Xbox Live, as well to try online gaming and really enjoy it. It was a decision made around bringing more people into the category, and we think that will bear other fruit, and obviously the first-week numbers speak for themselves in terms of success. We think that Halo will just continue to go from strength to strength.

GS AU: What can you tell us about your plans for promotion of Halo 3?

NS: There's not a lot that we have announced at this point in time, but you'll see it coming from a lot of different mediums, from cinema to outdoor, and a lot of extensive online. We're really keen to get the whole epic nature of Halo 3 out there with Master Chief as this epic hero, so you'll see a lot of Master Chief being the focus around that campaign. There's also Halo 3 dioramas which were produced, so we're keen to show that to show a different take on the game and the epic battles in it. There's a variety of things, but I think a lot of people will be very impressed and look for further information on the game. As well as that, there's also the Red V Blue campaign, we have the charity promotion that we announced recently with Red V Blue and Halo 3, so again, I think if you're into V8 SuperCars and you like watching Bathurst, you'll notice Master Chief out and about there as well. It's a pretty extensive campaign.

GS AU: Halo 3 was the biggest entertainment launch in Australian history. What does this milestone signify for the Australian gaming industry, and more importantly, the other entertainment formats?

NS: The first part of that question, what does Halo 3 mean for the gaming industry? It's one of the things we've talked about for a long time. We firmly believe at Microsoft that gaming is as credible a form of entertainment as music, movies, DVDs, and this really again puts it on the map. It's not just a niche group of people playing these games. It's very much a broad entertainment phenomenon, and Halo 3 is the pinnacle of that. What we're seeing with Xbox 360 sales is that a lot of people are getting in and experiencing games like Halo 3 and buying Xbox 360. It puts it there as an entertainment form up there with any other type of entertainment people consume.

GS AU: Should movie and book retailers now be concerned that they now face the risk of falling behind gaming?

NS: I don't think it's a concern for anyone, I think it's just a complementary thing. People choose to use their time in different ways, but my perception is that gaming has had this stigma attached to it that it's not sociable; it's not as fun as doing other types of entertainment whether that be movies or music. Whereas the releases of games like Halo 3 show that there are a lot of people interested in the gaming category, and a lot of people buying games like Halo 3, and a lot of people buying systems like Xbox 360, so it shouldn't worry other categories, it's a complementary use of putting gaming as a part of everyday life for people that choose to relax and unwind after a hard day's work.

GS AU: Nick Segger, thanks for your time.