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Phil Spencer on Xbox One Demand and Halo

by William Schwartz

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The introduction of the Xbox One was troubled to say the least. With memorable quotes like “#dealwithit” “Backwards capability is backwards” and “We have a system for those who don’t want Internet connection. The Xbox 360”, Microsoft dug themselves a deep hole, much to the benefit of Sony. While Microsoft has made a bunch of reversals, there is still a general discontent with them. With Sony announcing their pre-orders have numbered over 1,000,000, some have wondered how Microsoft had been faring. In an interview with the Wall Street Journal, Phil Spencer elaborated on the demand of the Xbox One, the next Halo, and the impact of smartphones on consoles.

When asked about the demand for the Xbox One and whether he felt that Microsoft “stumbled a little” Spencer replied, “If you look at the metrics that matter for the business like pre-orders, buzz around the launch portfolio and the content, we feel incredibly good. Our pre-order numbers are bigger than they were for the original Xbox, bigger than they were for the 360. Now you want to turn pre-orders into actual sales. I actually think this generation – and the fact that it’s head-to-head competition this holiday – is probably going to play out more next holiday and beyond. This holiday, I think you have a lot of people lining up, because they’re fans of the franchises and the platform, but over a two- or three-year period, you start to get some of those swing consumers making decisions. I would take a longer term view.”

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When asked about the next Halo, he said, “The journey begins in 2014. I like to say it’s the reason why I still have a job, because, in many ways, the original Halo justified the original Xbox as a gaming platform. It became the breakout hit. It was foundational in creating Xbox Live when Halo 2 came out. I’m really excited to see what 343 does with Halo on Xbox One. I think that’s going to be great.”

Some have wondered why Microsoft didn’t have the next Halo as a launch title. Spencer elaborated, saying, “Halo is our most important entertainment franchise at the company. It’s a $3 billion franchise if you look at all the products that have been sold for Halo. As a standalone business, as a standalone entity, it’s a really important franchise. You want to make sure you have the right product in market. There’s the axiom that a game is only late once, but it’s bad forever.

 There’s the axiom that a game is only late once, but it’s bad forever

You want to make sure when that game comes out that it’s true to the heritage of what Halo is. Halo’s been a strong franchise for us for over a decade and I want to keep it that way. We’ve got 23 launch games this year, more launch games than we’ve ever had. It’s an incredibly strong line-up of existing franchises and new things coming. There’s also at some point more content than what people can consume.”

Finally, he was asked how smartphones and tablets have impacted the “traditional” console. Spencer said, “A standalone gaming device could be seen as something from a previous generation. When we started with the Xbox One, it was about how do we design a device that integrates into the ecosystem that people already know and love, letting them bring their devices into the play experience with SmartGlass, letting me watch TV, play games browse the Web, Skype with my friends on an interface that feels very familiar to people. We’re trying to turn that television sceen into an interactive screen like any other screen that I work with. I think it’s important that consoles come up to speed with what these other devices do.”

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