The first video game console born in pandemic
Xbox products arrive on deadline, even if not quite according to plan
The debut of a video game console is a carefully choreographed event. It matches state-of-the-art electronics with complex software and bigbudget games. It takes years of development and billions of dollars in collective investments, all building to a single deadline. The Xbox Series X was the fourth go-around for Microsoft Corp., and the company had a plan to improve upon the lacklustre performance of its last console.
Then on Jan. 20, the first confirmed U.S. case of the coronavirus was reported in a suburb of Seattle. Over the next six weeks, the area surrounding Microsoft’s headquarters became the country’s first hot spot. After the virus claimed some of the first lives in a nearby nursing home, Microsoft closed its doors to most employees on March 4.
“Everyone has a plan until a global pandemic punches you in the face,” said Jerret West, the marketing chief for Microsoft’s Xbox.
At first, Microsoft worried about whether manufacturers, many of which are in Asia where the virus originated, would be able to deliver hardware on time. But China soon contained the spread, and the supply chain issues proved to be less severe than anticipated. The biggest problems for Microsoft were at home.
The games planned for the Xbox Series X couldn’t be developed on the kinds of laptops people have lying around the house. So Microsoft and its game development partners went to work on a Plan B. They shifted to cloud computing tools and bulked up their network infrastructure to enable workers to remotely access more powerful machines located in dark offices. It still wasn’t enough for some Microsoft engineers, who took turns ransacking the office and piling heavy equipment into their cars, one executive recounted. For one star employee, Microsoft explored running a fiberoptic cable underground to his home in the woods.
After a chaotic final year of development, Microsoft releases on Tuesday a pair of new game consoles, the Xbox Series S and X. The products arrive on deadline but not quite according to plan. Microsoft delayed the most-anticipated game, Halo Infinite, after a tepid reaction from fans to an early demonstration. That leaves the new Xbox without a single major exclusive game this year.
The rival console, Sony Corp.’s Playstation 5, debuts Thursday with a stronger game lineup and momentum from its predecessor. That will make it difficult for Microsoft to catch up, but analysts said the new Xbox is compelling enough to chip away at Sony’s lead from the last generation of consoles, which began in 2013. The Playstation 5 is expected to sell 4.6 million units this year, compared with 3.2 million for the Xbox Series S and X, according to market research firm Omdia. Microsoft has said it expects to sell every Xbox it ships this year.
In Japan, where Sony is based, the outbreak was far less severe, and lockdowns were minimal. The virus isn’t solely to blame for the discrepancies between the two products, but it had an impact. And the consequences for Microsoft’s games will linger into next year and maybe longer, said Phil Spencer, head of the Xbox division. But Spencer is optimistic that Microsoft can reverse the fortunes of its previous console, the Xbox One.
“I feel so much better about our readiness for this launch than I did Xbox One,” he said in a video interview from his home office. “And we did this in the middle of a pandemic.”
Microsoft released the original Xbox in 2001, along with its hit game Halo. That began the modern console wars between Microsoft and Sony. (Nintendo Co. was typically off doing its own thing.) With each new console, the two companies trade places in the U.S. The Playstation 2 outsold the Xbox. The Xbox 360 outsold the Playstation 3. The Playstation 4 outdid the Xbox One.
The next console is an opportunity to learn from past mistakes, and Microsoft knew what it needed to do this time. With the Xbox One, it misjudged the market by charging more for gimmicky motion controls and focusing on television content and entertainment features, alienating gamers who felt they were no longer central to the vision. When Spencer took over the business in 2014, he cut prices and refocused on games.
The new Xbox is designed to capture the full spectrum of consumers. For $500, the Series X caters to diehards with the most powerful game system ever made. For $300, the Series S offers access to a slightly watered-down version of the latest games at a price competitive with the old systems.
Microsoft, as it does for any major new product, had contingency plans for a lot of scenarios in case things went wrong. No one planned for a pandemic. The conditions especially imperiled the game development process. Artists, sound designers and programmers each rely on specialized equipment at the office. Development kits, which include early versions of the new consoles, are given under contracts that often stipulate they cannot leave the office.
One team at Xbox offered a temporary fix. Microsoft had built an app for creating and testing games over the web as part of its streaming service xcloud. Microsoft repurposed the tool so that developers could access high-end hardware in the office from their home computers. The xcloud team made the app capable of displaying higher resolutions, and it can reproduce audio in surround sound. Nearly 60 studios, including some of Microsoft’s own and the Activision Blizzard Inc. team behind the new Call of Duty, used the tool to develop and test their games. Microsoft also used it to fix bugs with the hardware.
“It enabled us to ship our console on time,” said Daniel Kennett, principal software engineering manager for xcloud.
Meanwhile, Microsoft looked for ways to simulate the office environment. For example, the xcloud tool lets employees connect to each other’s machines to collaborate on changes or new art. Then someone can share their creation through Microsoft Teams with a group of coworkers over a video conference.
“That restored a level of normalcy,” Kennett said. “Being stuck at home and not being able to walk around the floor and see where stuff’s at is brutal.”
Amid a cascade of intense deadlines, Alan Hartman needed to figure out how to distribute tacos to his team. Hartman runs Turn 10 Studios, the Microsoft-owned division that makes the car-racing simulation Forza Motorsport.
Hartman’s group assembled in late April to produce a video that would introduce the new Forza game to the world. In an annual crunch-time ritual known within the group as Battle Week, they left an audio chat room in Microsoft Teams running all day.
In normal times, Hartman might have rewarded the labour with a party at the office. Employees had to settle for home deliveries arranged by the marketing staff, consisting of oversized buckets of multiflavored popcorn, Champagne and taco-making kits.
As is typical for a console launch, the Xbox will be hard to find this holiday season.
“I feel good about our supply,” Spencer said. “Would I take more? Definitely.”
The new timing for Halo Infinite could work in Microsoft’s favour, Spencer said, if it can help sell more consoles when supply catches up with demand. In the meantime, the new Xbox is poised to benefit from the pandemic video game boom of 2020. It gives people something else to occupy themselves with during quarantine.
No one planned for a pandemic. The conditions especially imperiled the game development process.