Peter Moore Invades Japan
 
http://www.1up.com/do/newsStory?cId=3146236
 
1UP: So, you guys launched in North America and Europe. How did that go? What are your thoughts on that?
 
Peter Moore: Spectacularly well.
 
1UP: Spectacularly well?
 
Moore: Unless you're a guy who hasn't got one, and then you're anxious, frustrated--
 
1UP: ...like Steve Ballmer?
 
Moore: Like Steve's kids! True story. Steve, I don't know if you're familiar with Sarbanes-Oxley, but that's the law since Enron and everything. If you're the officer of a company, you can't accept a gift. Steve's obviously an officer of a company, so, even if we wanted to give him one, we couldn't. And he can't buy one--because he can't find one. And so the Ballmer boys--Steve has three boys, they're all pretty...I don't want to say "hardcore gamers," Steve would hate me for that, but, they all want to play with the 360 and just can't get one right now.  
 
1UP: So, spectacularly well.
 
Moore: U.S. was sold out actually in minutes, from the point of view of how many were available past the people that had preordered in April and May and June, there wasn't a lot. Some retailers kept some back to allow people at least the opportunity to line up and get one. But the number of people who lined up for what was left was huge. So a lot of people were disappointed. We're replenishing the channel every week, but it's an incredible demand situation. It's by far the number one desired gift for Christmas.  
 
1UP: How did the U.S. launch and the European launch differ from what you have going on here, the Japan launch?
 
Moore: I don't think that they differ too much. Certainly, the software, the games available at launch are different. When you look at the types of games we ve got here, things like Every Party, in particular Ridge Racer, would not be at the European or the U.S. launches. But from the idea of the overall strategy, the branding is exactly the same, the tagline's the same--the TV commercials, the actual tactical marketing, is a little different here, but the strategy of building momentum being part of a global launch, doing something that no company has ever done before, which is delivering all three regions in the world within 18 days of each other. Usually it's 18 months. You know, when we, tomorrow morning, hand that first Xbox 360 to that first lucky gamer in line, we'll have completed the enviable and very difficult-to-achieve task of launching globally.  
 
1UP: You bring up a good point there, though, about the games. The number of games that Japanese players are going to be able to play from tomorrow is fairly limited. You've got six launch titles--a bunch of the big games were delayed. Dead or Alive, Enchant Arm, Ninety Nine Nights those games missed launch. And then the backwards compatible list is only 12 games, only one of which was Japanese--Ninja Gaiden. So, in retrospect, now that you're just about there with the worldwide launch, do you still think that that was the right decision?
 
Moore: Absolutely. It's a marathon, not a sprint. Day one--do you remember PlayStation 2's day one lineup?  
 
1UP: Yes. Very well.
 
Moore: Tell me, what were the triple-A killer games that were a part of that?  
 
   
1UP: That's true, but then again, this is Japan, and we're coming off of Xbox 1 in Japan which everybody knows was not the biggest success. And obviously you guys are trying to turn that around in Japan. Having big titles at launch, coming out of the gate with a bang, I'd think would be important here.
 
Moore: Yeah, I mean, you would like Dead or Alive 4 not to be a couple of weeks after launch. But one thing I will never do, and Itagaki-san would never let me do, is rush a title out to meet launch that he's not happy with. It's non-negotiable, with either he or I. So we made the determination a few weeks ago, look, we've got to get this title where it needs to be, a couple of weeks isn't going to kill anybody, a year from now, everybody will have forgotten that it was two weeks after launch.  
 
Ninety Nine Nights is a deeper title than we ever dreamt from an immersive point of view, and it's going to take time to finish. I think it shows our confidence that we don't feel we need to pack everything in, cut corners, cut features, get 20 games at launch, regardless of quality, that's not what we're about. This is really a marathon that we're committed to for many years. And having the games at the right quality, rather than forcing them into a launch period, is far more important.  
 
We're looking at a long-term strategy of not only Ninety Nine Nights, but then think Blue Dragon, and then think Lost Odyssey--I mean, the fact that we're very comfortable being a year away from Sakaguchi-san's titles coming to market, still being very cool with that, knowing long-term what we're going to do to get behind this platform is indicative of our commitment to this market.  
 
1UP: You said before that the Japanese market is an important one for Xbox. Tell us why.
 
Moore: Well, I think, A), I still see this as the cradle of videogames. I still see some of the most creative people in the industry reside right here in Tokyo. We also see the importance of Japanese publishers, not only to the domestic market in Japan, but also their influence on the U.S. market and the European market, and perhaps equally importantly, to the broader Asian market. So when I think "Konami," I don't just think Konami in Japan, I think Konami with Pro Evo Soccer in Europe. And I think Sega with a great title, Condemned, which has done very well in its launch, Full Auto will come out, I think Sega with Sonic the Hedgehog, Virtua Fighter. I think Namco and Capcom--
 
1UP: So are you saying Virtua Fighter is going to come to Xbox 360?
 
Moore: No, no, I just think great franchises--although I would LOVE Virtua Fighter, what are we at, 5? to get there, and for Yu Suzuki to come back to the franchise and get it going on. But, that's for Sega to talk about.  
 
I think that the importance of Japan is actually threefold. I think that it's still a viable market on its own, a very powerful market, let's say a 25 to 30 million unit console market in this generation. I think it's the springboard to Asia, role-playing games from people like Sakaguchi, great games like the Mizuguchi one we're developing with Phantagram in Korea, Ninety Nine Nights, and I think that it's important to me that when Nakamura-san of Namco or Oguchi-san of Sega walk outside their front door or walk down to Akihabara that they see Xbox 360 as a viable competitor. I also don't want my competitor to have free reign of this market without us challenging them.  
 
1UP: How important is that? To be first out of the gate here. Let's go back to the whole "coming out in Japan at the same time" thing. Would it not have been better for you guys to have more units available in the U.S. where the demand is really great? How do you see the demand here?
 
Moore: Ask me tomorrow night! I sense the demand is strong--I'll be better off 24 hours from now. Yeah, one could argue that you'd be better off, but I think that disses the Japanese consumer. Someone gets shafted along the way, every time, with videogames. Usually the Europeans. And that shouldn't be the case. This is a global economy now. We're at Internet speed. Marketing needs to be advertised across global consumers, not local consumers. And the ability for us to feed off the power of your--let me tell you, the power of the U.S. launch gave us so much momentum going into Europe, it was unbelievable.  
 
There was a feeding frenzy--and it wasn't the marketing that we were doing locally. It was the global aura that we had created, this incredible frenzy in the U.S. which got picked up in real time from, you know--gamesindustry.biz, EuroGamer, CVG, SPONG, for God's sake. All of these, it's real time, they sent correspondents over to the U.S., they report back in real time. They're videotaping outside of U.S. retail stores and feeding that back in the next morning into European websites. We can't think that you can do things in a vacuum anymore. And it actually has benefited us. The Europeans LOVE us. LOVE us, for having delivered them, this holiday, high-definition gaming experiences. When they know that typically they usually have to wait six-to-eight months, if not longer.  
 
And so as a result, yeah, we wish we had more units, demand is unbelievable, but the fact of the matter is, there are a lot of people loving playing Xbox 360 around the world right now.  
 
 
But one thing I will never do, and Itagaki-san would never let me do, is rush a title out to meet launch that he's not happy with.  
 
1UP: Okay, so let's talk about Xbox Live, then. From our experience, we know that in Japan, gamers that play online are not quite like gamers that play online elsewhere. Just as an example, I used to go online with a lot of Xbox 1 games, and when I d play with gamers in America, you d always have the loud, kind of obnoxious guys talking trash to each other--
 
Moore: --trash-talking, yes!  
 
1UP: And, you know--
 
Moore: You need to get a very good Friends List, then. (laughs)  
 
1UP: My Friends List is all the guys at 1UP, they talk trash to me all the time. But, you know, in Japan it's different. Mostly, everybody is very polite. And a lot of our Japanese friends say that they don't actually like to get online because they're shy about meeting people they don't know--does that affect your strategy of how you market Xbox Live in Japan?
 
Moore: Xbox Live, one of the bright spots of the previous generation actually has been the attach rate of Xbox Live to, albeit, a relatively small install base, but we've had a very--in fact, the people that are going to be their tonight are Xbox Live guys, bringing their Gamertags.  
 
What we find over here is that they actually do go to a Friends List type environment, and they find their six or eight buddies, and the appointment game: "I'll be in the lobby" or "I'll be here at 8:00 P.M. tonight, let's all meet up and get going." Yes, it's tough for them to interact, their English is poor, typically, or they're intimidated by the experience online, and find it difficult to either compete or collaborate with people in the U.K., or people in the United States. But our experience, and we know this exactly because we can watch the data servers, is that Japanese gamers will play amongst themselves, keep their Friends List together, and that's just fine. That is just fine. There are more intrepid ones that love to go at it and, you know, they're pretty more hardcore and they fancy themselves at Halo 2 or whatever else and they give it a go, and I love those guys, but, yeah, I mean, it's whatever you want to do online. And in fact, you know, now with Xbox Live Silver, they can go on, and just, talk to their friends. You're really now in an environment--or they can download demos and trailers, or getting Marketplace, or Xbox Live Arcade. It's going to be HUGE. Believe me.  
 
1UP: Are there specific plans for Xbox Live Arcade for the Japanese market? Because one of the few gaming environments where Japanese gamers ARE competitive is the arcade environment, and traditional fighting games. Are you speaking to Japanese publishers about bringing some of those titles to Xbox Live Arcade?
 
Moore: Absolutely. Ohhh, yeah. You think of Sega, Namco--just take those two companies and their incredible background in arcade games. Their intellectual property, their back catalog, the IP that they own. We're just getting up and running with Arcade now. So 10 games go live tomorrow [in Japan]. You'll have the ability to go and play Mutant Storm, Zuma, Geometry Wars, Joust. Joust in high-def, multiplayer online. Who'd've thunk it? But as time comes, you'll see more and more games there. And absolutely. We've been talking to the classic, location-based--the companies that grew up out of the pachinko parlors into the--typically, it's the Segas, the Konamis, the Namcos, a little bit of the Capcoms, but--what an incredible opportunity to bring those old favorites back. You can even think of those old Sega Genesis games that you can reformat and pop up there and play, just cool arcade experiences. Arcade is going to be a killer app.  
 
1UP: A lot of that stuff, downloading demos and things and stuff--well, in Japan you guys are only launching one model. There's no--am I allowed to say "retard pack"?
 
Moore: A lot of people bought the "retard pack" in the last couple of weeks, believe me.  
 
1UP: That was a conscious decision, not to have that here--what was the reason for that?
 
Moore: Well, you ask about distinctive Japanese consumer taste. We looked at what we felt we needed to do in the early going. The fact that you'll be able to get a free beta of Final Fantasy XI tomorrow when you pick up your 360 is a big deal. And we also think that MMORPGs in particular, just using FFXI as an example, are going to be very important. And when we look at what we need to do and when we look at what our consumer's going to be here in the first few months, we didn't see the demand for the Core System that we do everywhere else.  
 
Let me be clear on the Core System. The Core System is built when we look at a five-to-ten year strategy and we roll out what we need to be in 2007, 8, 9, and 10. We need both features and price to be on our side. And the Core System gives us that ability to use price on our side. Don't think of it for the Japanese market, or even the U.S. market, but think of it for markets that, A), got to go into China--price is an issue. Got to go into Russia. Got to go into India. Got to go into Poland, Hungary, Latvia. Those are markets we're going in. We're going to globalize this industry, and price becomes a big issue. The other thing, when you look at Xbox 1, having that hard drive built in cost us a lot of money. Not having the flexibility for a more casual gamer down the line, to sell them an Xbox for $79 that doesn't have a hard drive. Doesn't have it, but I'm just gonna go buy an MU and I'm as happy as a pig in you-know-what playing. We sold every single Core System that we put in the market in both Europe and the U.S. And the Hard Drive wasn't attached one-to-one. So people just went out, got an MU--sometimes didn't even buy an MU! Just went out and played--but it's no different than the PlayStation 2 or the GameCube. You can call it the "retard pack," but what is it? With those two consoles, you've got to go out and buy out an MU, right?  
 
1UP: From the sound of it, you probably could have sold all Premium Packs--
 
Moore: Probably, yeah.  
 
1UP: But what about the developers? This isn't specifically Japan-related, this is more of a worldwide thing, but you know, by having that option--I guess, that the hard drive is not built into every system, you sort of segregate the potential community. The developers, they want to make a game for everybody--
 
Moore: Let the games speak for themselves. Two years ago, we sat down with developers and explained our strategy. The first thing they want overall is, what's the biggest install base you're going to give to me? How are you going to drive to a 50, 60, 70, 80 million install base, 100 million install base. Sat down and talked about our strategy for the globalization and using price and features as two different "weapons," if you will--which, I don't like to use that word, but, that's what we needed to do. When you learn your mistakes from the first one--you can't cost reduce something that's got a fixed hard drive, fixed memory built in there, we just can't cost reduce it to where we need to be. And we need to offer cascading price points in 2008, 2009, 2010, to bring in tens of millions of gamers each year. And the flexibility the Core System versus the Premium SKU gives, is that.  
 
1UP: A question about Japanese developers there s been a lot more Japanese support than a lot of people were expecting. There were games from Okamoto, from Sakaguchi, from Mizuguchi, but we haven't seen any big announcements in the past few months about Japanese development. When can we expect some new information?
 
Moore: So our focus has been over the last couple of months, as you would think, the strategy has been focus on the launch, not focus on continuing to promise things 18 months, two years from now. Once the launch is done--cause we've got enough in the hopper that we feel very comfortable about that--once the launch is done and we're moving in, you're going to see a lot more announcements. There are a lot of games in development right now, in Japan and in broader Asia, that haven't been announced. But you have this, what we call "quiet period" that is a very focused marketing strategy. Let's let the consumer focus on the here and now. Let's not distract him with what's coming in 2008. No, what's coming on December 10th, 2005 is what's important. So, you have a very deliberate PR strategy about what you announce and what you don't announce.  
 
The other thing you need to do as well is, we spend a fortune on places like E3 and GDC and CES. Well, we plan ahead six, eight months at a time in what we call "rolling thunder" for announcements. And, you know, otherwise, why would I spend tens of millions of dollars to go to these things if I have nothing to announce? So, we tend to actually link our announcements to events. X05 being the most recent, of course Tokyo Game Show here. You really want to justify when you have an audience and when people expect announcements from you. So random announcements out of the blue about titles, I think, doesn't serve that purpose.  
 
1UP: So we can expect more Japanese announcements of the caliber of Okamoto and Mizuguchi and stuff like that?
 
Moore: Potentially, yeah.  
 
1UP: You mentioned MMORPGs. What do we hear about True--
 
Moore: --True Fantasy Live Online?  
 
1UP: Yes.
 
Moore: You don't hear anything about it because it isn't going to happen.  
 
1UP: It's not going to happen.
 
Moore: I keep telling you it's not going to happen. Nobody believes me when I said that a year ago, and...  
 
1UP: Do you still have a relationship with Level-5?
 
Moore: With Hino-san? Yeah, absolutely. Level-5 is a great developer, and we still have a "relationship." Is there a game? Uh, no. Does that mean there won't be MMORPGs from other places? No, that's not the case either.  
 
1UP: One more question. If you could have one dream Japanese game on the Xbox 360 - this is a serious question - any game from an existing franchise that you don't already have from Japan, what would it be?
 
Moore: I'm trying to think what we DON'T already have... Mario. (Everyone laughs)  
 
   
1UP: Well, okay...how about something more realistic? Wait, we just confirmed you guys are buying Nintendo.
 
Moore: Yeah, let me see how much I've got in my pocket. MARIO!  
 
1UP: Mario.
 
Moore: What's wrong with that?  
 
1UP: Well, there's nothing wrong with that.
 
Moore: I love Mario.  
 
1UP: I guess we were thinking of something we could realistically look forward to, like a third-party game. There have been a lot of franchises that have gone from being PlayStation exclusive to being PS3 and Xbox 360 both. But if you could get one franchise to jump ship over that hasn't done it yet, what would it be?
 
Moore: From Japan? Well, a couple of games come to mind. That I could own, and call my own. Things like Animal Crossing, Kingdom Hearts, things like that, you could argue. Things that, I think...I think we feel very comfortable about our Square Enix relationship. I dunno. But seriously, Mario is the one, I love Mario. I can still see me playing that game, driving me nuts, mushrooms, and [starts making Mario jumping noises].  
 
1UP: So the Revolution controller is just gonna be an add-on for the Xbox 360, huh?
 
Moore: ...Well, we'll see. [laughs] I love the idea of the controller. We'll what see what it pans out to be.  
 
1UP: Thanks very much for your time today, and good luck with the launch tomorrow.  

Les japonais ont bien de la chance, puisqu'à l'occasion du lancement de la Xbox 360 sur leur territoire, une chaine japonaise a diffusé ce reportage de 10 minutes consacré à Ninety Nine Nights. On y découvre quelques séquences inédites. La qualité n'est pas extraordinaire, une autre version devrait être disponible demain. Bien entendu c'est intégralement en japonais.