Interviews// Peter Moore: The Exclusive and Essential Interview: Part One

Peter Moore was an interesting signing for Microsoft some two and half years ago. With a platform-holder pedigree and a passion for evangelising - a key component of any Xbox executive's armoury - Moore didn't as much as fit the required mould as cut it around himself during his time at Sega. But herein lay an issue with the gaming hardcore that would be difficult to overlook. Could a man globally renowned for fighting the corner for Sega - now an established underdog with a loyal hardcore following - make the jump to an unknown console from one of the world's biggest (and arguably most unpopular) companies?

And another problem also presented itself, perhaps one misperceived by Microsoft as a bonus - Moore would essentially be saying the same things about the Xbox as he did about the Dreamcast...

In this frank and in-depth interview, Peter Moore offers a rare insight into the development of the Xbox program. Conducted on-site in Redmond, Washington, this interview should represent all you need to read on the emerging 360 platform and how Xbox emerged from a bare concept, became a rank outsider, and now represents a global brand worth billions.

SPOnG: Let's start with Xbox - the original Xbox. How do you feel it performed and what are it's successes and failures? And how does this set up the emerging 360?

Peter Moore: Well, we grade ourselves globally-by-regionally, so we feel incredibly good about the progress we've made since launch here in the US. I think we feel fine about Europe and we know we have a lot of work to do in Asia and specifically in Japan. So, when you think about it globally and you remember that Xbox simply didn't exist four years ago, that it was only launched in November 2001, we've built an incredible brand that has relevance all over the world. We have built some intellectual property that I think any publisher or platform holder would be proud of - be it Halo or Forza or Project Gotham or Jade Empire or Fable. And more importantly, what it takes to be successful in videogames - what we call the ecosystem - relationships with retailers and publishers... People forget that we didn't have a retail relationship at Microsoft. While we do some retail stuff, mice and keyboards and so on, you don't find a lot of Microsoft 'stuff' at retail, at least that level of goods requiring such shelf-space and marketing. So we've built expertise all around the world.

We've built from scratch a brand, I think we've built credibility in the marketplace and I think we've built our ecosystem, be it our relationship with publishers, with retail. We have a hugely positive relationship with developers, something we are extremely proud of here. The DNA of Microsoft is building platforms. Creating something and then inviting everyone to come and play with it and come and make money on this stuff we have. Xbox is no different. You hear us talk a lot about it as a platform and it's this combo of hardware, software and services that all come together to create this platform.

There's a culture here of self-flagellation. We are always looking at what we can do better - when we drive into the parking lot, we'll look at the line and wonder if we could have done better. Only a B-? Not good enough.

As positive about how we feel Xbox has performed, there are lessons to be learned from it. We've got to rebuild the brand for growth, we have to take the architectural, industrial design of this thing [taps a nearby Xbox] and transform it into something that is far more mild and organic. From wild and architectural to mild and organic. So what could we have done better in the first generation? We could have made the brand a little more approachable. It's still dark and hardcore and we need to broaden it out. And the MTV special...reaction to that ranged from interest to ridicule depending on who you are... and I'd like to take this opportunity to point out that that wasn't aimed at a gamer audience by any means.

I think we've come a very long way. A measurement of this is, some people said, 'why not just buy Nintendo?' Another is, if we were to look at the market today, at where Xbox fits and it's worth, it's in the billions and billions of dollars, if somebody wanted to buy Xbox today...

SPOnG: But on core investment alone it's worth that...

Peter Moore: Say, I don't know, Disney or Universal. If they wanted an end-to-end business that has hardware, has huge software support, market expertise and a brand, I mean the brand alone is worth hundreds of millions of dollars. Xbox is worth billions of dollars already.

SPOnG: So how was the Microsoft team put together? It's such a massive undertaking...

Peter Moore: Well, the team started off as Bill Gates and Steve Ballmer. This was something they believed there was great opportunity to make a difference in. Over the years you've talked about 'The Trojan Horse' and asserted there's an end game here that's not about videogames. That we want to infiltrate your living room and just attach a cash register to your broadband connection.

SPOnG: But in fairness, there were many Microsoft executives going on record in 2000 and 2001 to say that there would only ever be games and that there would never be any other content throughout the project, and they said this repeatedly.

Peter Moore: When Robbie Bach stands up and talks about 'digital entertainment' and the headline 'Lies Exposed!', and remember that I read SPOnG every day, and then I read on your site that [Ken] Kutaragi said, 'this is never a games machine', and I wait for the next day for the same reaction and it never comes.

SPOnG: But Sony has always said that though, since the PlayStation 2. It has always been their published plan.

Peter Moore: Yes. But they have never delivered. The element of what we're trying to do - we believe that games are at the core of interactive entertainment in the future. That when we look at what people will be doing with their televisions next year or the year later - well the TVs themselves are now built for videogames and interactive entertainment. The 18-30 male demographic has beautiful televisions but they ain't watching television on them. They're playing games, they're on Xbox Live. They're bringing gaming out of the bedroom to where it really belongs - with your cool TV, 16 x 9 aspect ratio, surround sound system... Games offer a more compelling entertainment experience than television and we know we can make a difference and compete. We know we can be a major player in interactive entertainment and we know that investment into the game space is what we need to do. We've done that as you well know, to the billions of dollars, and we'll continue to do that.

You asked me about the team... In the early days the team was cobbled together from Microsoft guys who were gamers. We've been making games for two decades as a company and that's something people often forget. We're far more experienced at making games than Sony ever was. Perhaps one could ask, 'what took you so long to get into the console business?' So what happened was, I was still at Sega at the time, I stood on stage at E3 2001 and gave my support to what was, if you will, the handing of the baton, of the dream, from Dreamcast to Xbox. Xbox was to take my dream of social gaming on a global scale onwards. At that time, when we made the decision about what needed to happen to Dreamcast as a piece of hardware, Microsoft was the first company to call. On January 31st, 2001, a sad day when I had to lay off 50 people from Sega America. A tragic day, stuff that stays with you.

So Microsoft was the first company to come to our support and I never forgot that.

SPOnG: There was a relationship there already from Dreamcast, wasn't there?

Peter Moore: Yes, there was the Windows CE relationship. They were evangelists from a development point of view but there was never a consumer relationship. There was a strong relationship. Okawa-san and Bill Gates had a good relationship in those days, so ATG came to Sega and said, 'We understand you are changing into a third-party company. How do we help you? So Microsoft came in and Sony, I believe, did not. And that has stuck with me as well.

So the team started to build. Seamus Blackley, Kevin Bachus, Robbie Bach at the helm. J Allard then came in and the team was reaching critical mass. Xbox was then launched and was met with critical acclaim. The games looked and still look spectacular. And despite the fact that Halo was something of a debacle at E3 - the frame rate was choppy and blah, blah, blah, the rest is history. Then the industry started to take note. So when you walk these halls, you'll find people who've been Microsoft people from the get-go and bring with them the sheer brilliance of the average Microsoft employee. People from Konami, Activision, Capcom, Namco, EA... on top of that you have Disney people, people from Hollywood...we've built a subculture within a culture. We're still part of Microsoft of course, but we're in a campus that's away from main campus. The culture here is about gaming, but driving to the future of gaming, rather than trying to merely replicate what everyone else has done.