MI­CROSOFT NEEDS EX­CLU­SIVES MORE THAN EVER.

EDGE - - XBOX ONE -

“I run first­party stu­dios, so I’m all about ex­clu­sives,” Spencer says. “When we talk to people, that exclusive con­tent is the num­ber one rea­son that gamers buy a given con­sole, so I’m go­ing to stay ex­tremely fo­cused on bring­ing great exclusive con­tent to the box. It’s crit­i­cal.”

De­spite this, in­for­ma­tion is baf­flingly scarce. 343 In­dus­tries’ new Halo will doubt­less form the back­bone of Xbox One’s Q4 lineup, and In­som­niac’s open-world shooter Sun­set Over­drive is also ex­pected this year. Those aside, lit­tle is known about Mi­crosoft’s plans, and Spencer won’t talk specifics. He’s teas­ing a big re­lease from a “won­der­ful” Ja­panese stu­dio – his choice of ad­jec­tive spark­ing spec­u­la­tion that Plat­inum Games is the de­vel­oper in ques­tion – but un­til Mi­crosoft shows its hand at E3, it’s hard to see where the next big thing is com­ing from. Halo de­fined the first Xbox, and Gears Of War did like­wise for 360. New games in both those se­ries are com­ing, the lat­ter in de­vel­op­ment at Black Tusk Stu­dios af­ter Mi­crosoft bought the IP from Epic Games, but new con­soles are rarely sold on sequels alone. Spencer says E3 will be “great… a real mo­ment for us in this gen­er­a­tion”. In the mean­time, he has lit­tle choice but to talk up Ti­tan­fall. “That’s a de­fin­i­tive ex­pe­ri­ence for us. Cloud-pow­ered, mul­ti­player, it looks beau­ti­ful, it plays beau­ti­fully: all the things that have been [at­trac­tive] about an Xbox [One] game, it em­bod­ies a lot of them.”

Yet these days, a con­sole’s soft­ware lineup is about more than big-budget block­busters. While Mi­crosoft’s lack of a plan for in­die games at Xbox One’s launch is per­haps the most con­fus­ing of its litany of over­sights, it has be­lat­edly got things back on track with ID@XBox, an in­die self-pub­lish­ing pro­gramme whose first 25 games were un­veiled last month. “We’ve been inun­dated with ap­pli­ca­tions,” Har­ri­son says. “Two- hun­dred-and-fifty de­vel­op­ers al­ready have de­vk­its and are build­ing games for Xbox One; that is more than the en­tire in­de­pen­dent de­vel­oper count on 360 through­out its en­tire life­time. To have that many de­vel­op­ers, and that much in­ter­est, is re­ally healthy for play­ers, and it’s also su­per-healthy for the game in­dus­try. It’s a bet­ter on-ramp for de­vel­op­ers to get into our space.”

That ramp, though, is not with­out its bumps. Chief among them is Mi­crosoft’s no­to­ri­ous par­ity clause, which for­bids de­vel­op­ers from re­leas­ing their games any­where else be­fore they’re avail­able on Xbox. Not hav­ing an equiv­a­lent is why Sony was able to show off such a spread of in­die games at E3 last year: many of them ei­ther al­ready have, or will, hit Steam be­fore launch­ing on PS4. The par­ity de­mand is a pol­icy that served Mi­crosoft well in the early days of Xbox Live Ar­cade, when com­pe­ti­tion was scant, but these days Mi­crosoft needs indies much more than indies need Mi­crosoft. Small stu­dios have plenty of op­tions else­where, not least a ri­val plat­form holder that is will­ing to han­dle the port work for them. Barely a month goes by with­out an­other an­nounce­ment of a cov­eted in­die ti­tle head­ing to PlayS­ta­tion, and in­de­pen­dent stu­dios have played a vi­tal role in flesh­ing out PS4’s re­lease sched­ule. A Mi­crosoft rep told us ear­lier this year that the par­ity clause was up for dis­cus­sion on a caseby-case ba­sis, while the GDC ru­mour mill had it that it will soon be dis­carded. That would have been un­think­able from Mi­crosoft in the 360 gen­er­a­tion, but the po­si­tion of strength it en­joyed is gone. It would be no sur­prise to see that out­moded pol­icy thrown on the bon­fire with all the oth­ers. And the longer it stays in place, the greater the op­por­tu­nity for Sony to fur­ther in­crease its stand­ing. On the eve of GDC, Sony’s VP of pub­lisher and de­vel­oper re­la­tions, Adam Boyes, tweeted a pic­ture of a mocked-up pre­sen­ta­tion slide ti­tled “Plat­forms that you are not al­lowed to re­lease a game on prior to re­leas­ing it on PlayS­ta­tion plat­forms”. Be­low it was a blank list of bul­let points. A cheap shot, per­haps, but Sony reaps the mind­share re­wards with ev­ery blow it lands, and Mi­crosoft keeps leav­ing its guard down. Har­ri­son says he laughed at Boyes’ tweet, but it was a timely re­minder that exclusive and in­die games, im­proved dev tools and user in­ter­faces, and even re­vised poli­cies will only take Xbox One so far. Its big­gest prob­lem re­mains Sony, which of­fers the more pow­er­ful box at a more at­trac­tive price, and has a bet­ter

stand­ing among de­vel­op­ers and play­ers alike. The hubris that gave rise to PlayS­ta­tion 3 has gone, as are many of the ex­ecs as­so­ci­ated with it.

It may help Mi­crosoft that many of the faces as­so­ci­ated with Xbox One’s bun­gled be­gin­nings are also now gone. Don Mat­trick, for­mer pres­i­dent of Mi­crosoft’s In­ter­ac­tive En­ter­tain­ment Busi­ness (the di­vi­sion re­spon­si­ble for Xbox), quit to go work at Zynga. CEO Steve Ballmer has re­tired. And on the eve of GDC, chief prod­uct of­fi­cer Marc Whit­ten left to take up the same po­si­tion at wire­less au­dio leader Sonos. Mi­crosoft has a new CEO, Satya Nadella, and IEB has a new pres­i­dent in for­mer Nokia CEO Stephen Elop, but Molyneux be­lieves that the most sig­nif­i­cant de­par­ture of them all will be Whit­ten’s.

“He was very in­flu­en­tial,” Molyneux ex­plains. “Per­haps more than you re­alise, be­cause he was in charge of all of the soft­ware – the op­er­at­ing sys­tem side. A lot of the things Phil Spencer’s group wanted to do, quite of­ten they didn’t hap­pen be­cause they weren’t im­ple­mented on the op­er­at­ing sys­tem side. Him leav­ing softens quite a few lines.”

It leaves Har­ri­son and Spencer as the pub­lic faces of Xbox, and be­ing able to put two ex­ecs with ex­ten­sive ex­pe­ri­ence of the game in­dus­try in front of press, play­ers and cre­ators will surely help with im­age re­pair. Epic CEO Tim Sweeney says the two Phils “have done a great job of open­ing up to the com­mu­nity and talk­ing as real hu­man be­ings about Mi­crosoft’s plans, and that’s a re­ally wel­come change from what was pre­vi­ously a very PR-driven com­pany. I’m very hope­ful Mi­crosoft is get­ting through this long win­ter of mis­man­age­ment. It came from the top, de­spite the best ef­forts of the guys in the trenches, and I’m hope­ful they’ll do a lot of good things.”

Yet even those man­age­ment changes have brought on bad head­lines. When he was in the run­ning for the CEO gig, Elop was re­ported to be con­sid­er­ing sell­ing off the Xbox busi­ness, some­thing in­vestors and an­a­lysts have long called for. In his first memo to staff af­ter tak­ing up the CEO role, Nadella spoke of a “soft­ware-pow­ered world” and a “mo­bile- and cloud-first world”, which on the face of it doesn’t seem to leave much room for Xbox. The fi­nan­cial press be­lieves Nadella will seek to sell the di­vi­sion, or spin it out into a sep­a­rate com­pany for which he would not be ul­ti­mately re­spon­si­ble.

“You’ve never heard that from us,” Spencer says. “Xbox is maybe the most rel­e­vant brand that Mi­crosoft has with con­sumers to­day. We’re go­ing to main­tain our con­sumer fo­cus. We’re spend­ing a ton of money, bring­ing in Nokia [with] 30,000 people join­ing the com­pany to go build con­sumer phones. Con­sumer is part of what this com­pany is. You think about the Xbox brand and all the eq­uity around it, people lin­ing up at mid­night out­side of Game to go get the con­sole – how many Mi­crosoft prod­ucts have that? It’s an as­set that’s ex­tremely valu­able, and since our fu­ture am­bi­tion is to grow our con­sumer rel­e­vance, Xbox has to be at the cen­tre of that. When I have dis­cus­sions with Satya, or Stephen, or [EVP of op­er­at­ing sys­tems] Terry My­er­son, it is more about how we make this brand, this prod­uct and this propo­si­tion more rel­e­vant to our cus­tomers, and not at all in the op­po­site di­rec­tion.” These words are en­cour­ag­ing. Xbox One’s trou­bled start had many causes, but none would have been quite so dis­as­trous had Mi­crosoft’s mes­sag­ing not also been so in­cred­i­bly mis­guided. The com­mon per­cep­tion cre­ated was of a box built not to serve play­ers or de­vel­op­ers, but Mi­crosoft’s busi­ness goals. With the suits who de­fined those goals now gone; a man­age­ment team in place fo­cused not on the needs of those sell­ing the box but on the people work­ing and play­ing on it; patches to solve many of its teething trou­bles; and the worst of the PR nightmare now hope­fully be­hind it, Xbox One is in its best po­si­tion since May 2013 and its dis­as­trous un­veil­ing. Mi­crosoft should also be able take heart in Sony’s ex­pe­ri­ence with PlayS­ta­tion 3, which be­gan with $599 and Gi­ant En­emy Crabs and ended with The Last Of Us, PlayS­ta­tion Plus and even­tu­ally even bet­ter sales than Xbox 360. Whether or not Nadella and Elop give Har­ri­son and Spencer enough time to see things through is an­other mat­ter.

“TWO-HUN­DRED-AND-FIFTY DEVS AL­READY HAVE DEV KITS AND ARE BUILD­ING GAMES FOR XBOX ONE”

Though Bungie is no longer helm­ing, Halo re­mains an ap­peal­ing and key part of the slim suite of Xbox One­ex­clu­sive games

Bay­o­netta cre­ator Plat­inum Games is ru­moured to be de­vel­op­ing for Xbox One

Clock­wise from above: for­mer Stu­dios head Marc Whit­ten now works for Sonos; Don Mat­trick left for Zynga; CEO Steve Ballmer has also stepped down, but has yet to leave

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