Exclusive Microsoft interview

Question: Please can you tell us about the European price cut in the broadest sense…

Paul Fox: The price of the Xbox in the United Kingdom is to be reduced from an estimated retail price of £299 to £199, and from 479 Euros to 299 Euros. The other thing that we feel is especially newsworthy about what we’ve done which sets a new precedent in the industry is we’re putting together a value package for our early adopters, the guys and girls that bought the console between March 14 and April 26. This value package amounts to one controller and two games of their choice. We are guaranteeing any first party titles and we are currently attempting to finalise deals with third-party partners so there are certain to be third-party games as part of that choice.

Q: Isn’t all this a little embarrassing?

PF: What, that we’re putting together this fantastic value pack for our early adopters?

Q: No, what we mean is, is the scale of the price drop embarrassing so soon after launch?

PF: The whole way that Microsoft has entered this industry has shown that we are prepared to listen and show that we’re prepared to do stuff differently and break some of the rules. OK, nobody’s ever cut the price of a console this soon; fair enough. But then again nobody before, in the wake of a price cut, has offered such a powerful value package to reward existing consumers. We’re not afraid to break convention.

Q: We’ve noticed a shift in the outlook of Microsoft towards the gaming industry in as much as in the early days of the Xbox the company took a very bullish stance. It seemed to many analysts that you as a company thought that if Sony just walked in from a different context and completely dominated the market, that another company of a greater magnitude with arguably better technologies under its belt should be able to do the same thing. What do you think of the shift of the public and industry faces of the company within the time-frame to the present day?

PF: Back at the original European preview for the Xbox at Nutopia we announced all the developer and publisher partners that we had and we were rightfully very proud of that achievement; getting so much support so quickly. The other thing that we’ve done, on and off the record, is to really acknowledge the tremendous success that Sony has had in helping make gaming a ‘now’ industry and a mainstream phenomena. I don’t think that we ever really thought that what Sony had achieved was so easy. Sony took the games industry from the toy industry to the mass-market, and I’d like to again put on the record how respectful we are of that achievement.

Q: Both Acclaim and THQ have recently publicly spoken out to say that they believe a price cut for the Xbox in Europe was essential. Was the pressure from publishers taken into account when deciding upon the price cut for the Xbox?

PF: A lot of factors were taken into account when we decided the price cut.

Q: Does this set a precedent for the price point around the world? In the US, the Xbox has gained a strong foothold in the market, being as it is the same price as the market leader, though more powerful and better equipped, do you think that the revised price point for Europe will be reflected in the Japan or the States?

PF: The only price cut that we are announcing is the price cut in Europe. I wouldn’t be the person to tell you any other news.

Q: Can you comment on the recent sales figures in Japan?

PF: We always knew that Japan would be a challenging market and it’s proving to be as challenging as we thought it would be (laughs).

Q: Any comment on being outsold by the Dreamcast in the first week of April?

PF: Not by the figures that we’ve seen. But if you’ve seen different figures then I’ve not seen them.

Q: Can you tell us about the next round of Xbox first party games?

PF: Okay, the new round of first-party titles are: Crimson Skies, Mech Assault and Quantum Redshift. We’re very proud of them, they’ve come from Microsoft Game Studios and hopefully they represent only the tip of the iceberg that people are going to be excited about at E3.

Q: As far as E3 is concerned, is there anything we should be looking out for?

PF: Us! All the new first-party games will be shown and given a lot of profile at E3. In addition to that, there will be some pretty interesting announcements as you’d expect from us. We’re keeping them under our hat at the moment but E3 will be an interesting time to be watching Microsoft and watching the games industry as a whole. I’m sure that Sony and Nintendo will be doing some exciting some stuff too.

Q: You have a press conference scheduled two days before E3 commences. A mixture of informed speculation and common sense would suggest that this almost certainly going to include an American and Japanese price cut for the Xbox.

PF: The press conference is going to focus on all of our show news – that’s clear. It will be an exciting press conference. We’ve got a lot to say.

Q: So what now for Europe? What are you hoping to achieve from this price cut?

PF: What we are trying to achieve is to make it clear in no uncertain terms that we are very, very serious about succeeding in this industry. And not only that, we’re serious about our long-term success. We want to be very careful about managing your expectations and the expectations of your readers. It’s not going to be an overnight, dramatic change in any of our sales or figures. What we’re trying to do is set ourselves up for success now, success this holiday season, and the success beyond that. This is not a knee-jerk reaction to cause an instant jump in sales: this is something that is going to see us on the path to long-term success.

Q: The GameCube is due to enter the market in two weeks, does that have any bearing on the price cut decision?

PF: As I said, it was another of many factors – yes.

Q: To clarify to another point, both Richard Teversham and Michel Cassius have both confirmed that Metal Gear Solid X is scheduled for release for Xbox. In fact Richard Teversham said he was delighted that Metal Gear Solid 2 had come out for PlayStation 2 as he said that the Xbox version will be much better. Konami, on the other hand, refuse to confirm the existence of the game. Hideo Kojima himself refused to make any comments. Can you clarify this point for us please?

PF: I have nothing to add to what my colleagues have already said, I would say that for the most up to date information you should go direct to Konami. We have to respect our relationship with them; it’s a Konami game, not a Microsoft game.

Q: Is there anything that you want to add?

PF: I’d just like to stress that what we have done with the value pack is an unprecedented move for the industry.