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The battle to control
the entertainment pipe
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00:00:02,503 --> 00:00:04,713
into your living room
just got a bit more interesting.
3
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Microsoft's Xbox announcing
some landmark news today
4
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as it moves into the media business.
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It's time for a new generation of Xbox!
6
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And now, Microsoft wants to
appeal to more than just gamers.
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It can also control your TV
and cable box and you...
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Everything from your movies
to video conferencing on Skype
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to doing all kinds of things.
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Casual gaming.
Television. Social, music, and video.
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The game console will transform
into a next-generation entertainment hub.
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For both gamers and non-gamers alike.
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What if I told you, that going forward,
our competition is not going to be
14
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Sony and Nintendo,
but television and media.
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Oh, God.
16
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There's a new contender
in the video game wars.
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Xbox is going to be...
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- The future.
- Truly the future of video games.
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Xbox.
Taking over the living room.
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Limitless connected
digital entertainment.
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You guys never understood!
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The company is going
to face fierce competition.
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Sniper. Nooo!
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It's a ticking time bomb.
25
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It makes me very nervous
to actually play this for you.
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Xbox, getting a major overhaul.
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A bold vision for the future of gaming.
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It's the Xbooooooox!
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On May 21st, Microsoft will unveil
its latest Xbox system.
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Xbox has been the best-selling gaming
console for 27 consecutive months.
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We're expecting a slew
of entertainment options
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including possibly
taking over your cable box.
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And also delivering web content
in easy and attractive ways.
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It was exciting to think about
what a single purpose,
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dedicated entertainment console could be.
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So we picked that as a path with Xbox One.
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We wanted a broad device that touched
all parts of gaming and entertainment.
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Go on. Put your hands in.
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00:02:06,210 --> 00:02:08,837
We wanted
to bring new audiences into Xbox,
40
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people that were outside of what
traditionally was thought of
41
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as our core gaming audience
that was really the intent at the time.
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Within the company
there's always a sense
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of do more, and grow.
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But I think Don was looking for like,
what's that next big leap after Kinect,
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and I think there was a sense
that TV could be that thing.
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Microsoft's gaming platform
is becoming a true entertainment hub.
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It just announced that for the first time,
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people are using the Xbox
more for entertainment,
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TV, movies and music,
than for playing video games.
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Having our team
think not only about gaming,
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but television, movies, stories that lived
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inside our gaming community,
was something that I believed in.
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Okay, this is an interesting idea.
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Microsoft's going to get
behind linear entertainment as well.
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Xbox Entertainment Studios.
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The idea was to take Xbox
the brand from gaming
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to Xbox the brand as entertainment.
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Movies, music, television.
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There was going to be
a number of documentaries.
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We all had big eyes for that, it's like
whoa, we're gonna go Hollywood now.
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Aaaand, action.
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After years in development,
Microsoft's next generation console
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was finally ready to be unveiled
at a media event codenamed Newcastle.
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Coming off the success of the Xbox 360,
expectations were through the roof.
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Good morning everyone.
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On behalf of the entire team,
we're thrilled to unveil
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the ultimate all-in-one
home entertainment system.
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We did a stream from,
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around the world, and invited a bunch
of media and influencers up to watch.
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We gathered everybody
into the conference room,
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we have it streaming on our television,
we're all really excited.
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Team Xbox is on a new mission.
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To become the all-in-one system
for every living room.
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The place where your games, TV,
and entertainment come alive.
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We're driven to build
a future-proof system
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that brings together the cloud,
smart devices, new content.
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We are really excited
to bring the world of Halo
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to Xbox as a premium television series.
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We're sitting there
listening to it the whole time,
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and I remember one of our engineers,
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said like, "They're not even talking
about any of the games yet.
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Are they gonna talk about games?"
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With Kinect, we made you the controller.
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This is human control
for a human experience.
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It was all about entertainment.
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Even a partnership with Steven Spielberg,
and they showed a TV guide.
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At the reveal event.
I mean that was really like, the vision.
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This is the beginning
of truly intelligent tv.
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Xbox.
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Watch TV.
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You said television.
We wanted to hear video games.
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You know, we showed a few games.
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But core gamers were left unsatisfied.
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We're all in the green room,
and as each person would get offstage,
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you know, the execs in the room would ask
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what the pulse is on social
and it was not good.
97
00:05:05,973 --> 00:05:07,349
This is not going well.
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This is not going well at all.
99
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I am really, really disappointed.
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I think I'm going to go into mourning now.
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That's how I feel about you, Xbox One.
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There were hypercuts released minutes
after the initial unveiling of the Xbox.
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Watch TV. TV.
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- TV remote.
- TV.
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- TV. TV. TV.
- Television.
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Television. Television.
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- TV. TV.
- Television.
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Television. Television.
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That was not the right way to unveil
the next generation of gaming.
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Wow.
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That was the worst gaming event
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that I've ever watched, ever.
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Probably could have done a better job
of reassuring people
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that we were committed
to excellence in gaming.
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00:06:01,069 --> 00:06:06,158
The response was so negative,
and that was when I knew our lack of focus
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00:06:06,241 --> 00:06:07,951
was going to hurt us
with our core audience.
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I can't... I can't even start.
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The Newcastle reveal really was about
showcasing the entertainment proposition
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that was going to come with the Xbox One.
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00:06:20,839 --> 00:06:23,926
We knew that E3 coming up
in a few weeks was about games,
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00:06:24,009 --> 00:06:26,178
we'll talk about all games
when we get to E3.
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00:06:27,304 --> 00:06:29,223
In hindsight,
definitely not the right decision,
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00:06:29,306 --> 00:06:31,850
you don't tell console gamers
to tune in to something
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and then not show them the games.
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The next evolution of gaming is a
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voice remote control for your television!
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00:06:43,779 --> 00:06:47,115
The Xbox One reveal had
obviously underwhelmed fans,
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00:06:47,324 --> 00:06:51,662
but Microsoft saw an opportunity
to right the ship just 3 weeks later,
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00:06:51,870 --> 00:06:54,206
on the game industry's biggest stage.
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00:06:54,289 --> 00:06:56,500
This is an exciting day for our teams.
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00:06:57,125 --> 00:07:00,712
And as we've been promising,
it's all about the games.
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00:07:01,505 --> 00:07:03,674
We're excited to share with you
a stunning lineup
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00:07:03,757 --> 00:07:06,802
of world premiere gameplay
and announcements.
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00:07:07,302 --> 00:07:10,931
The ball's in Microsoft's court, and they
come out and they show some games.
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00:07:11,974 --> 00:07:14,726
And then right at the end
of their press conference,
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00:07:14,810 --> 00:07:17,563
I remember looking up at the teleprompter.
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00:07:17,646 --> 00:07:20,357
Xbox One will launch this November
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00:07:20,566 --> 00:07:25,070
in 21 markets around the world,
at $499 in the US...
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$499.
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At the time,
the ideal price point was $399.
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00:07:33,412 --> 00:07:37,666
Anything over $399,
you're in for a real struggle.
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00:07:42,921 --> 00:07:47,217
The issue was that, with
Xbox One, Don's view was the new Kinect
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00:07:47,301 --> 00:07:49,803
was going to be required
as part of the box.
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So it was no longer just a peripheral,
like the original Kinect,
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now you were going to be
forced to buy one.
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00:07:54,975 --> 00:07:56,768
This is a terrible mistake.
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00:07:56,852 --> 00:07:58,353
A huge mistake.
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00:07:58,437 --> 00:08:00,522
It definitely caused a disconnect.
149
00:08:00,606 --> 00:08:02,983
Why are you charging me more money?
I don't want this.
150
00:08:03,066 --> 00:08:05,027
Kinect had so much promise.
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00:08:05,194 --> 00:08:10,616
It just wasn't ever going to be a thing
that hardcore gamers wanted.
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Especially when it upped the price
by a hundred dollars.
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00:08:15,621 --> 00:08:16,955
Felix!
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00:08:22,127 --> 00:08:27,674
And then, later that day, Sony
announces the price of the PlayStation 4.
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I'm very proud to announce that
PlayStation 4 will be available at $399.
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We were surprised by the $100 difference.
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You know. Didn't, this, like, it, that's
a pretty big headwind to come back from.
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You have
essentially the same hardware
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00:08:47,361 --> 00:08:49,696
but one device is $100 cheaper...
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00:08:49,780 --> 00:08:51,990
"Cool. I'm going to go with that one."
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And that's where they lost.
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360 set us up for being
the best box for developers,
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00:09:01,583 --> 00:09:03,460
the best box for core gamers.
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00:09:03,836 --> 00:09:08,298
And we then flipped it around
and said this isn't a dev box,
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00:09:08,507 --> 00:09:10,300
this isn't a core-gaming box.
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00:09:10,384 --> 00:09:12,678
This is an entertainment device.
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00:09:12,803 --> 00:09:15,556
People didn't know what to think,
they were just confused.
168
00:09:15,639 --> 00:09:18,267
You know they wanted to
push into this digital future.
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00:09:18,350 --> 00:09:20,477
The idea was, all connected, all the time.
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00:09:20,561 --> 00:09:25,357
The console would have to be able
to check in with Microsoft servers,
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00:09:25,607 --> 00:09:27,276
or else the games wouldn't work.
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Your content is available
and it's stored in the cloud.
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There were gonna be benefits to this
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00:09:32,155 --> 00:09:35,576
but Microsoft did a bad job
of messaging those benefits.
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00:09:35,659 --> 00:09:37,536
You don't always have to be connected,
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but for a lot of things
like multiplayer gaming
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or streaming content from the Internet,
you're gonna need an Internet connection.
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That's, that's the world we live in.
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00:09:45,752 --> 00:09:47,963
One of the biggest points of confusion
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00:09:48,046 --> 00:09:50,382
was how the new always online device
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00:09:50,507 --> 00:09:55,846
complicated the selling, trading, and
gamers' biggest concern, sharing of games.
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00:09:56,180 --> 00:09:58,557
We knew the digital age
and era was coming.
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00:09:58,682 --> 00:10:01,310
We knew it. And the original concept was,
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00:10:01,435 --> 00:10:04,021
you were going to have to be
connected to play your games.
185
00:10:04,104 --> 00:10:05,981
You're gonna play your games
on your Xbox One.
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00:10:06,064 --> 00:10:07,191
Here's a disk.
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00:10:07,274 --> 00:10:11,028
Load it in, and you were gonna have
to get a license for that disk,
188
00:10:11,236 --> 00:10:13,155
but you had to be online
to buy the license.
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00:10:13,530 --> 00:10:17,242
So it was a great way to not have
people doing big downloads,
190
00:10:17,326 --> 00:10:19,161
but here's the disk,
and just pass it around.
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That's it. Simple as that.
192
00:10:21,246 --> 00:10:23,332
Well, that wasn't clear.
193
00:10:23,415 --> 00:10:24,541
It seems like every single outlet
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00:10:24,625 --> 00:10:25,876
got a slightly different statement
195
00:10:25,959 --> 00:10:28,420
- on used games.
- Yep.
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00:10:28,504 --> 00:10:29,963
You can't share games between friends.
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00:10:30,047 --> 00:10:32,466
- You don't own the game you're buying.
Yeah.
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00:10:32,549 --> 00:10:35,344
Don't, don't pretend like you own
this thing that you just paid for.
199
00:10:35,427 --> 00:10:37,346
And then, stuff got really ugly.
200
00:10:38,138 --> 00:10:42,226
Sony came out, guns blazing, with the
immediate response to the Xbox One.
201
00:10:43,310 --> 00:10:45,312
This is how you share your games on PS4.
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00:10:49,942 --> 00:10:51,193
Thanks.
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00:10:51,276 --> 00:10:53,695
One person just hands
another person a disk.
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00:10:54,112 --> 00:10:57,783
Because you, you weren't gonna be able to
do that with this always online Xbox One.
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00:10:57,866 --> 00:10:59,034
Your game is your game.
206
00:10:59,117 --> 00:11:00,202
You own it. You can sell it.
207
00:11:00,285 --> 00:11:03,497
You can trade it in.
That was, that was brutal.
208
00:11:12,589 --> 00:11:14,925
As a team you've gotta take some bets
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00:11:15,008 --> 00:11:17,761
on things that you believe in
and put that thing out.
210
00:11:18,846 --> 00:11:20,472
Clearly in hindsight it was wrong.
211
00:11:21,849 --> 00:11:26,270
People didn't want to spend $499 for a box
to plug into their television to watch TV.
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00:11:26,478 --> 00:11:28,856
They weren't wrong, Microsoft wasn't wrong
213
00:11:28,939 --> 00:11:32,484
that gamers wanted and expected
more from their consoles.
214
00:11:32,693 --> 00:11:35,904
Absolutely. In fact,
it was Microsoft's fault if anything.
215
00:11:35,988 --> 00:11:41,702
They were too far ahead of where
their users thought they should be.
216
00:11:42,244 --> 00:11:44,872
And there was this whole backlash
that they didn't expect.
217
00:11:45,998 --> 00:11:48,083
In 2013, the world wasn't ready for it.
218
00:11:48,166 --> 00:11:51,295
We got pushback from consumers,
from some journalists,
219
00:11:51,628 --> 00:11:54,715
questioning whether we'd made
the right choice as a company.
220
00:11:54,840 --> 00:11:58,468
It was a valid criticism,
but it was a very binary choice.
221
00:11:58,552 --> 00:12:01,930
And we chose to bet on online.
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00:12:03,849 --> 00:12:06,518
It was a dark, dark,
dark, dark moment for us.
223
00:12:06,602 --> 00:12:09,521
And, ah, very, very, very painful.
224
00:12:17,654 --> 00:12:21,783
News raced around the tech blogs Monday
that the man behind Microsoft's
225
00:12:21,867 --> 00:12:24,912
future console, the Xbox One,
is leaving the company.
226
00:12:26,288 --> 00:12:30,709
I wish that I would have had
an opportunity to stay,
227
00:12:30,918 --> 00:12:34,171
to execute on the vision
and the capabilities
228
00:12:34,254 --> 00:12:38,091
that the team had created,
but I ended up in the summertime
229
00:12:38,175 --> 00:12:40,219
announcing that I was going to be leaving.
230
00:12:40,302 --> 00:12:43,430
I just remember getting
an email from Steve Ballmer
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00:12:43,514 --> 00:12:45,933
that essentially said
Don Mattrick has left.
232
00:12:46,016 --> 00:12:48,477
I think we all just sort of
looked at each other
233
00:12:48,560 --> 00:12:51,104
and were like,
"Okay so, what happens now?"
234
00:12:52,523 --> 00:12:53,690
There was no fear.
235
00:12:54,816 --> 00:12:55,901
No failure.
236
00:12:58,779 --> 00:13:00,030
But the rules have changed.
237
00:13:06,328 --> 00:13:09,540
It was a long road,
and a long path from there,
238
00:13:09,748 --> 00:13:12,334
but the team didn't give up,
didn't wanna quit,
239
00:13:12,417 --> 00:13:14,461
didn't feel like
we couldn't overcome this,
240
00:13:14,545 --> 00:13:17,923
and, we still had to come out
and deliver the console.
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00:13:18,006 --> 00:13:21,093
Well it's here. Xbox One, finally on sale.
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- Xbox One!
We had a line of people
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at the launch event,
people were excited about it.
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We had kind of an early signal
that maybe things were okay.
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The MBD group has revealed that Xbox One
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led console sales in December,
and with its $500 price point,
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the Xbox One led annual hardware sales
on a dollars basis.
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But, by April, we were outsold six-
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or seven-to-one in the market,
maybe eight-to-one.
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This was really bad.
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Like catastrophic bad.
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The reality is when you
have moments like this,
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the, the future of the brand is at stake.
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You question whether or not
you're gonna be here in five years.
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It's never a given that you're gonna get
to make another generation of a console.
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Brands die every day.
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No one's playing on an Atari anymore,
like nobody is playing on a Sega Genesis.
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We felt like our future was at stake.
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I think Microsoft learned the hard way,
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if you take your eye off the ball,
and if you don't put gamers and games
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at the center of your ambitions,
it's going to come back and bite you.
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Our fans had lost faith.
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It's collapsing.
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Move it! Move, move, move!
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How do we re-earn the trust of customers?
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One thing that was very clear,
more of the same was not gonna work.
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Today Microsoft has announced
that the Microsoft Studios
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corporate vice president Phil...
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Spencer is the new head of Xbox.
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Let's talk about your new role.
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What are you gonna be doing?
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The emergency glass was shattered
and Phil was pulled out and put in
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to right the Xbox ship that was sinking.
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He was there early days,
studied under Ed Fries,
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so he knew exactly what made
the original Xbox work.
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He was a gamer. But he was also
a longtime Microsoft guy,
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so he's sort of the perfect hybrid.
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He is a proxy for gamers.
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They believe in Phil.
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I play lots of games with Phil
on weekends and evenings,
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and he's always thinking
about the player first.
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Having someone lead the platform,
who comes from that place.
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It was a big turning point for us.
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We needed somebody that could lead us,
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that we trusted,
that cared about the team.
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I had no training
in running a team of that size,
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or the platform team or the hardware team.
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So I knew that it would be a challenge.
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One of the things that was really hard
about the Xbox One launch was,
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Phil had more than a broken business,
he had a broken culture.
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There were people who would
literally come up to me in, in tears.
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Who had killed themselves
to try to get a product into market.
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The product did not make gamers happy.
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So I knew we had to get the team onboard,
we have to believe in why we're here.
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The first thing that Phil did
was he went after culture.
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I wanted to try to continue to see Xbox
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be an important brand in gaming,
but it's not just about me.
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As a leader you realize
that if we can't empower our great people
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to do great things that we should give up.
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I knew that this effort
would take the entire team,
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and it was gonna be incredibly hard.
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Under Phil's leadership,
and with a green light from Microsoft,
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the Xbox team launched a plan to pull back
from the edge of console obscurity.
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Xbox had a lot of plates to spin.
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They had to gain the trust of developers,
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they had to make
a statement with the gamers,
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reverse all of the messaging
that they made,
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and that's not a switch
that you flip overnight.
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That can take years. Years.
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I don't think there was a question
around where I wanted to focus.
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We know that day-one customer
every year has to be the gamer,
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you expand from that gaming audience out.
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With Phil being in charge, it sort of
cemented putting a game face back on Xbox.
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- Marty? Big news today.
- Yeah?
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Yeah, bombshells.
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Microsoft announced that a
Kinect-less Xbox One is coming June 9th.
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Yeah. For $399.
Yeah.
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One of the decisions that we had made
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is that we were gonna offer
Xbox One without Kinect,
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and lower the price by $100.
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This is what everyone wanted.
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Xbox Entertainment Studios,
which is better known
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as the TV division, has been shut down.
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Shutting down Xbox Entertainment Studios
was really just tradeoffs we had to make.
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All of the investments that you're making
in that entertainment, the movies,
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the TV shows, and things,
are going to come at the expense
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of making the same investments in games.
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And, we still had more games
we needed to make.
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Microsoft has announced a new platform
for independent developers
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looking to bring their games to Xbox One.
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Game content is the thing
that's gonna drive our success
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as much as anything else that we do.
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We needed external independent developers
to be successful on our platform.
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Independent developers
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have fundamentally changed
the way we play games this generation.
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The smartest move that Microsoft made was,
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they took Chris Charla,
who was a developer,
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00:18:45,542 --> 00:18:47,377
and said we're gonna allow self-publishing
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and this is the guy who's gonna
really help with that.
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Players don't care
if it's from a big company,
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or a single person,
they just wanna play fun games,
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00:18:55,344 --> 00:18:58,805
and our job as a platform holder
is to make that happen.
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This was a guy who was a developer,
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smart guy, he understands the community,
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he's been there himself,
he was great in that role.
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00:19:06,063 --> 00:19:08,315
Major League Baseball
publishes a baseball game
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through the ID@Xbox program.
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00:19:09,983 --> 00:19:13,028
Fortnite, from Epic,
came through the ID@Xbox program.
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We have the ability to get, you know,
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our small, cool little ideas
up on the big screen.
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It's just an amazing experience
that none of us really saw coming.
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Back when Microsoft said
Phil's gonna be in charge,
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our faith went way up
that things were gonna change
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and then right away they did,
and then when Microsoft showed
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that they were making these moves,
you were like, this has all the
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opportunities to really go the right way,
but the gamers were still upset,
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and you're like,
"Well look, it's a big ship,
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but the changes they just made,
give them a chance."
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While lowering the price
of Xbox One and reprioritizing developers
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were major steps towards getting back
into the good graces of gamers,
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a desire to enlist
an entirely new generation of players
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inspired Xbox to go somewhere
it had never been before.
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Let's go to a place
where everything is made of blocks.
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Where the only limit is your imagination.
365
00:20:08,709 --> 00:20:13,046
The team said, how many kids have
their first experience with any video game
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with mom or dad's cell phone
in the back seat playing Minecraft?
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The company that is known
for Windows and word processors,
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will pay two-and-a-half billion dollars
for Swedish game developer Mojang,
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that is the company behind the wildly
successful, ever-popular Minecraft game.
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No, they're gonna mess it up!
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Right after the acquisition,
all of the public perception
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when you read about in the press
was that evil Microsoft
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was going to come ruin Minecraft.
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00:20:40,032 --> 00:20:43,785
Can Microsoft keep its hands off Minecraft
and just keep that, that pure experience.
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00:20:43,869 --> 00:20:47,623
There was an assumption, you know again
that old console war thinking,
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00:20:47,706 --> 00:20:54,087
that Microsoft would pull it off of any
platforms that weren't Windows or Xbox.
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00:20:54,421 --> 00:20:57,382
There certainly could have been
a decision that look, we just paid
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00:20:57,466 --> 00:21:01,470
a bunch of money for this game,
we need it to go help Xbox so from now on,
379
00:21:01,595 --> 00:21:04,097
the only place you're gonna be able
to play Minecraft is on Xbox.
380
00:21:04,681 --> 00:21:06,517
There's gotta be something
bigger going on here.
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00:21:07,434 --> 00:21:11,730
But I'm grateful that Phil Spencer
understood that what we had
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was a cultural phenomenon
and what we had acquired
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almost as much as a game
was the community that came with it.
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Go Red Side, go! C'mon Red Side! C'mon!
385
00:21:22,324 --> 00:21:23,659
The world is changing
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00:21:23,742 --> 00:21:27,788
and the idea that limiting the places
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where people can experience your games
is not always right.
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00:21:33,168 --> 00:21:35,587
Whether you're playing
on an Xbox, PlayStation,
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an Android, iOS device,
our goal is to continue to evolve
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and innovate with Minecraft
across all those platforms.
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Woohoo!
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The decision to make Minecraft
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accessible across all platforms
surprised the industry,
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00:21:52,271 --> 00:21:56,108
but Xbox had something on the horizon
that would upend it.
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Wondering what's going on, eh?
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00:21:58,610 --> 00:22:00,654
Wonderful. Let's get started!
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00:22:00,737 --> 00:22:03,156
With all of the things
that we're trying to go do,
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00:22:03,240 --> 00:22:06,827
creating Game Pass,
was a decision that was gonna be
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00:22:06,910 --> 00:22:08,579
disruptive to the industry.
400
00:22:09,705 --> 00:22:10,747
Oh, hey!
401
00:22:10,831 --> 00:22:12,541
Game Pass was the first service
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00:22:12,624 --> 00:22:14,334
where you'd have access
to a library of games
403
00:22:14,418 --> 00:22:17,129
and you could download and play the games
in their full fidelity locally.
404
00:22:19,923 --> 00:22:23,385
We heard from people who said
buying multiple $70 games
405
00:22:23,468 --> 00:22:25,345
is actually just
economically not possible.
406
00:22:25,804 --> 00:22:28,307
And people wanted to play across devices.
407
00:22:28,390 --> 00:22:30,976
With Game Pass, you now have
a shared library with your friends,
408
00:22:31,059 --> 00:22:34,688
and you can just decide to say, "Hey,
let's go, let's go jump on and play this."
409
00:22:37,065 --> 00:22:39,651
What we learned as part of it
was kind of not necessarily
410
00:22:39,735 --> 00:22:42,196
something we do at the beginning,
it became this part of the journey
411
00:22:42,279 --> 00:22:44,865
is it also created
enormous value for publishers.
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00:22:44,948 --> 00:22:48,785
Developers that might not have had
the front row or front seat.
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They're in there,
and they're on the same level as Halo.
414
00:22:53,123 --> 00:22:55,542
You know when you're building a game,
if you're not a known IP,
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00:22:55,626 --> 00:22:57,044
it's really easy to get lost.
416
00:22:59,922 --> 00:23:03,717
The biggest thing about Game Pass
is the amount of players.
417
00:23:04,384 --> 00:23:08,555
I can put a game into Game Pass
and 10 million players
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00:23:08,639 --> 00:23:11,433
can show up the next day
who might not have decided
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00:23:11,517 --> 00:23:13,685
to plunk down $60 for my game.
420
00:23:13,769 --> 00:23:16,146
It lowers the barrier to entry,
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00:23:16,230 --> 00:23:19,650
it makes it easier for you
to experiment and choose.
422
00:23:19,733 --> 00:23:22,402
The people that subscribe
actually play more games.
423
00:23:22,486 --> 00:23:26,323
It's just like flick, flick, flick,
oh yeah I'll play this one for a while.
424
00:23:26,406 --> 00:23:29,409
And now you see other companies
considering and moving
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00:23:29,493 --> 00:23:30,786
in faster to the Game Pass model.
426
00:23:30,869 --> 00:23:33,413
Game Pass is probably the future
of how we distribute games.
427
00:23:39,628 --> 00:23:42,798
Game Pass revolutionized
the landscape of video gaming,
428
00:23:42,881 --> 00:23:44,508
but in order to get the most
429
00:23:44,591 --> 00:23:46,760
out of the tsunami of new content
they were providing,
430
00:23:46,844 --> 00:23:49,638
Xbox knew it was time to up the ante.
431
00:23:52,850 --> 00:23:57,312
When we launched the original Xbox,
we had this tagline.
432
00:23:57,437 --> 00:23:59,022
"There's no power greater than X."
433
00:23:59,314 --> 00:24:02,109
And we were the most powerful.
And we owned that.
434
00:24:02,401 --> 00:24:03,986
That's what our gamers expected from us.
435
00:24:04,069 --> 00:24:06,446
That's what we had delivered um, early on.
436
00:24:06,530 --> 00:24:08,156
We were always the most powerful console.
437
00:24:08,240 --> 00:24:10,659
And we lost that with Xbox One.
438
00:24:11,535 --> 00:24:13,787
As we thought about broadening
what the Xbox One did,
439
00:24:13,871 --> 00:24:18,208
we had sort of lost sight of first
and foremost, this is a gaming machine.
440
00:24:19,376 --> 00:24:22,504
The PlayStation 4
was a technically superior experience.
441
00:24:23,005 --> 00:24:25,507
You know, one friend tells his friends,
442
00:24:25,591 --> 00:24:28,927
"Hey, it's better on PlayStation 4,
you should play it over there,"
443
00:24:29,011 --> 00:24:30,637
and that just spreads.
444
00:24:30,929 --> 00:24:33,640
You know if we were a car company,
we always made the fastest car.
445
00:24:34,016 --> 00:24:35,767
That's what, was what our brand was.
446
00:24:36,268 --> 00:24:39,563
But for us to get back
to what we were always about,
447
00:24:39,646 --> 00:24:44,359
we needed a console that would be
more powerful than any other console.
448
00:24:44,651 --> 00:24:48,071
It was about reclaiming
the horsepower narrative.
449
00:24:52,743 --> 00:24:56,788
So Phil delivered Project Scorpio,
which they called the Xbox One X.
450
00:24:57,122 --> 00:25:01,919
We went back to our roots of being
the most powerful console ever built.
451
00:25:03,545 --> 00:25:05,714
More power, more pixels, more framerate.
452
00:25:05,797 --> 00:25:09,718
It was all about core gaming goodness.
453
00:25:09,801 --> 00:25:10,969
- True 4
- K gaming.
454
00:25:12,054 --> 00:25:15,015
They engineer
the world's most powerful console,
455
00:25:15,349 --> 00:25:17,935
they win back a lot
of gamer trust with that.
456
00:25:19,228 --> 00:25:25,067
This monster was almost like the rebirth
of the Xbox brand to continue to make sure
457
00:25:25,150 --> 00:25:27,653
there is no power greater than X
as we thought about the future.
458
00:25:29,613 --> 00:25:32,074
The most powerful console,
it's a thing of beauty.
459
00:25:32,157 --> 00:25:34,076
I think the big thing for me
is just games.
460
00:25:37,996 --> 00:25:40,582
How do we deliver
the best games to people?
461
00:25:41,375 --> 00:25:43,669
Get the games that our players love?
462
00:25:43,752 --> 00:25:45,420
We said, you know, content is critical.
463
00:25:45,838 --> 00:25:47,589
And one of the best ways
464
00:25:47,673 --> 00:25:50,092
to get the best games
is to invest in studios.
465
00:25:50,175 --> 00:25:51,426
That's what we like to see.
466
00:25:51,510 --> 00:25:54,137
But making games is hard,
it's complicated,
467
00:25:54,513 --> 00:25:56,306
it's about hey, can a group of people
468
00:25:56,390 --> 00:25:58,809
actually effectively
create something together?
469
00:25:59,560 --> 00:26:00,811
We have to be really thoughtful
470
00:26:00,894 --> 00:26:03,730
and mindful about respecting the culture
471
00:26:03,814 --> 00:26:07,401
and the heritage of the studio
but also infusing, you know,
472
00:26:07,484 --> 00:26:08,944
kind of the power of Microsoft.
473
00:26:09,027 --> 00:26:10,821
There's no magic formula for that,
474
00:26:10,904 --> 00:26:12,865
you know, I think that's more
of an art than a science.
475
00:26:14,241 --> 00:26:15,951
One of the biggest missteps
476
00:26:16,034 --> 00:26:18,954
that we learned from
in the past was Lionhead.
477
00:26:19,955 --> 00:26:23,876
We had already published Fable 1,
and it was a hit, people loved it,
478
00:26:23,959 --> 00:26:27,337
the beauty of that game,
it was basically like a moving
479
00:26:27,421 --> 00:26:30,591
stained-glass window, people wanted more,
and so we bought Lionhead.
480
00:26:31,341 --> 00:26:32,551
Those were good years.
481
00:26:32,885 --> 00:26:34,344
The game was great.
482
00:26:34,511 --> 00:26:35,929
Just everything came together.
483
00:26:36,513 --> 00:26:38,974
But after Fable II, Kinect came along,
484
00:26:39,057 --> 00:26:42,394
and the Fable-Kinect marriage
just never really took.
485
00:26:42,728 --> 00:26:45,314
And then Fable Journey
was a passion project
486
00:26:45,397 --> 00:26:47,733
for a lot of people,
but I think it deviated
487
00:26:47,816 --> 00:26:51,987
pretty significantly from the pillars
of what made Fable 1 and 2 so popular.
488
00:26:52,070 --> 00:26:54,823
Some very, very sad news
coming out of Microsoft today.
489
00:26:54,907 --> 00:26:57,743
They're shutting down Fable
developer Lionhead Studios.
490
00:26:57,826 --> 00:26:59,995
We acquired Lionhead in 2006.
491
00:27:00,454 --> 00:27:02,748
Shut it down in 2016.
492
00:27:02,915 --> 00:27:05,959
A couple years later,
we reflected back on that experience.
493
00:27:06,043 --> 00:27:09,004
What did we learn,
how do we not repeat our same mistakes?
494
00:27:09,087 --> 00:27:12,424
You acquire a studio
for what they're great at now,
495
00:27:12,883 --> 00:27:16,970
and your job is to help them accelerate
how they do what they do.
496
00:27:17,054 --> 00:27:19,431
Not them accelerate what you do.
497
00:27:19,515 --> 00:27:22,976
I wish Lionhead
were still a viable studio.
498
00:27:25,437 --> 00:27:30,609
It is only when you fall
that you learn whether you can fly.
499
00:27:31,777 --> 00:27:35,614
When we launched Xbox One X in 2017,
500
00:27:35,697 --> 00:27:38,867
we knew studio acquisitions
were gonna be huge for us.
501
00:27:38,951 --> 00:27:41,703
The studios we had
were creating amazing games,
502
00:27:41,787 --> 00:27:45,374
but we wanted to have more,
and the challenges that
503
00:27:45,457 --> 00:27:49,461
we went through with Lionhead
taught us what to do this time.
504
00:27:49,545 --> 00:27:51,672
Welcome to E3 2018.
505
00:27:52,005 --> 00:27:54,508
So with the many failures of the Xbox One,
506
00:27:54,591 --> 00:27:58,178
they're a distant second to Sony,
but, to their credit,
507
00:27:58,512 --> 00:28:05,102
they had been doing everything right,
the potential is there at E3 2018
508
00:28:05,185 --> 00:28:09,064
to regain that foothold
in the upcoming next generation.
509
00:28:09,147 --> 00:28:13,777
We know that exclusive games
from our Microsoft Studios
510
00:28:14,111 --> 00:28:17,614
are what originally turned
so many of us into Xbox fans.
511
00:28:17,739 --> 00:28:20,409
The first and greatest instance of us
512
00:28:20,492 --> 00:28:24,955
showcasing what we do for players
is what we do with our studios.
513
00:28:26,498 --> 00:28:28,333
Phil, he took out the credit card,
514
00:28:28,417 --> 00:28:31,378
went on a shopping spree,
bought some amazing companies.
515
00:28:31,587 --> 00:28:32,671
Started promising games.
516
00:28:33,964 --> 00:28:38,635
I'm excited to welcome Undead Labs
to Microsoft Studios.
517
00:28:38,969 --> 00:28:41,180
It doesn't matter what your technology is.
518
00:28:41,263 --> 00:28:43,473
If you don't have the games, we were done.
519
00:28:43,682 --> 00:28:44,850
Content is king.
520
00:28:44,933 --> 00:28:46,351
Ninja Theory.
521
00:28:46,435 --> 00:28:47,978
Compulsion Games.
522
00:28:48,061 --> 00:28:51,273
Brand new Microsoft studio.
The Initiative.
523
00:28:51,648 --> 00:28:52,816
Playground Games.
524
00:28:55,110 --> 00:28:56,320
Yesterday was a huge moment.
525
00:28:56,403 --> 00:28:59,615
You brought not 1, not 2
not 3, not 4, but 5 new studios...
526
00:29:00,240 --> 00:29:03,160
The acquisitions kept coming
at a blistering pace.
527
00:29:03,869 --> 00:29:09,291
We'll be acquiring InExile Entertainment,
Obsidian Entertainment.
528
00:29:09,750 --> 00:29:11,668
We doubled the number of internal studios
529
00:29:11,752 --> 00:29:14,838
to 15 internal studios
and made a big group of acquisitions.
530
00:29:14,922 --> 00:29:17,007
Double Fine Productions.
531
00:29:17,799 --> 00:29:22,429
Buying all those studios, Microsoft
focused back on the hardcore gamer.
532
00:29:22,513 --> 00:29:24,431
We're highlighting 60 games for you.
533
00:29:24,515 --> 00:29:27,809
Fourteen games from Xbox Games Studios.
534
00:29:27,893 --> 00:29:32,940
And over 30 games
premiering in Xbox Game Pass.
535
00:29:33,023 --> 00:29:34,358
Let's jump in.
536
00:29:37,819 --> 00:29:40,531
This volley of acquisitions
created one of the largest,
537
00:29:40,614 --> 00:29:42,574
most diverse catalogs in the industry.
538
00:29:43,200 --> 00:29:45,953
But Microsoft had its eye on more target.
539
00:29:46,036 --> 00:29:48,163
And it was a big one.
540
00:29:52,668 --> 00:29:56,296
We're really delighted to reach
this agreement with ZeniMax
541
00:29:56,380 --> 00:29:58,966
and bring Bethesda
into the Microsoft family.
542
00:29:59,049 --> 00:30:03,637
The move adds eight more studios
to Xbox's first-party portfolio,
543
00:30:03,929 --> 00:30:07,516
including Bethesda Game Studios,
ID Software, Arkane,
544
00:30:07,975 --> 00:30:10,352
MachineGames, Tango Gameworks, and more.
545
00:30:10,936 --> 00:30:15,107
What you really see us doing
is broadening the opportunity
546
00:30:15,190 --> 00:30:18,861
for people to participate in,
you know, what is one of the world's,
547
00:30:18,944 --> 00:30:22,155
you know, greatest entertainment
and leisure-time activities.
548
00:30:22,239 --> 00:30:23,615
It's a game-changer because it's bigger
549
00:30:23,699 --> 00:30:26,243
than anything else
we've ever done in gaming.
550
00:30:26,326 --> 00:30:27,744
It's the third largest acquisition
551
00:30:27,828 --> 00:30:30,372
in Microsoft's history,
which still blows my mind.
552
00:30:30,455 --> 00:30:35,878
So now more than ever like
our commitment to games, is absolute.
553
00:30:40,048 --> 00:30:43,051
Microsoft's commitment
to keeping fans on their toes
554
00:30:43,135 --> 00:30:45,345
was also absolute.
555
00:30:45,429 --> 00:30:47,222
Good evening everyone!
556
00:30:49,433 --> 00:30:52,436
Welcome to the Game
Awards 2019, I'm Geoff Keighley.
557
00:30:53,812 --> 00:30:56,023
Ah, world premieres
are a big part of this show,
558
00:30:56,356 --> 00:30:59,401
and you guys have a lot of expectations
on the Internet, for things,
559
00:30:59,484 --> 00:31:01,111
there are lots of rumors, lots of leaks.
560
00:31:01,195 --> 00:31:05,991
It's pretty rare I think nowadays
that any new tech doesn't leak
561
00:31:06,074 --> 00:31:08,035
and like nobody knows that it's coming.
562
00:31:08,118 --> 00:31:12,664
And then sometimes there's surprises
that come out of nowhere.
563
00:31:12,748 --> 00:31:13,874
Enjoy this.
564
00:31:16,251 --> 00:31:18,462
Let's suppose that
you were able every night
565
00:31:18,545 --> 00:31:20,422
to dream any dream you wanted to dream.
566
00:31:22,925 --> 00:31:23,926
A lot of dreams.
567
00:31:24,343 --> 00:31:26,053
And that you could have the power...
568
00:31:26,428 --> 00:31:28,180
I don't think anybody saw it coming.
569
00:31:28,263 --> 00:31:30,307
It was something completely unexpected.
570
00:31:32,518 --> 00:31:33,769
Uh...
571
00:31:33,852 --> 00:31:34,937
Whoa is it Elden Ring?
572
00:31:35,395 --> 00:31:37,397
Even the video was deliberately designed,
573
00:31:37,481 --> 00:31:40,901
talking about power your dreams
and, you know the visuals of that.
574
00:31:40,984 --> 00:31:42,528
Let's have a surprise.
575
00:31:42,903 --> 00:31:45,197
- Bioshock?
And then...
576
00:31:45,280 --> 00:31:47,241
Wait a minute, what was that?
577
00:31:48,951 --> 00:31:50,744
Wait what?
578
00:31:51,328 --> 00:31:54,957
I just saw a car race through,
and then there was like a soccer scene
579
00:31:55,040 --> 00:31:58,126
and then, by the time
I saw Master Chief...
580
00:31:58,210 --> 00:32:01,755
- That's Halo!
- Halo. That's what I want.
581
00:32:02,047 --> 00:32:06,343
And finally you would dream
of where you are now.
582
00:32:06,426 --> 00:32:09,847
And seeing the streamers that were
streaming, and their reactions,
583
00:32:10,639 --> 00:32:14,768
that element of surprise
is so magical and so powerful.
584
00:32:15,602 --> 00:32:16,687
- That's, that...
- Oh, that's Scarlet?
585
00:32:16,770 --> 00:32:18,939
Oh! Oh! yeah!
586
00:32:19,022 --> 00:32:20,941
Xbooooox!
587
00:32:21,024 --> 00:32:22,568
This is not the new Xbox console.
588
00:32:22,651 --> 00:32:24,278
Wait, this is not the new Xbox console,
what...
589
00:32:24,361 --> 00:32:26,405
They're showing their new box?
590
00:32:26,488 --> 00:32:27,656
What the heck!
591
00:32:29,449 --> 00:32:32,494
For 18 years and three generations,
592
00:32:32,619 --> 00:32:36,248
we've designed Xbox consoles
to power your dreams.
593
00:32:36,331 --> 00:32:37,833
Oh, my boy!
594
00:32:37,916 --> 00:32:39,501
You dog.
595
00:32:39,585 --> 00:32:41,211
Meet the Xbox Series X.
596
00:32:41,295 --> 00:32:45,883
It was nuts-o! Because I had no clue
it was coming, and I was there!
597
00:32:45,966 --> 00:32:51,763
Our fastest, most powerful Xbox
will set a new bar for performance.
598
00:32:51,847 --> 00:32:53,849
Games are going to look better.
599
00:32:53,932 --> 00:32:56,393
You know games are going to play better.
600
00:32:56,476 --> 00:32:58,645
It is in fact the most powerful console
601
00:32:58,854 --> 00:33:00,856
you can have
in your living room right now.
602
00:33:00,939 --> 00:33:03,734
Yes! Yes!
603
00:33:05,527 --> 00:33:07,863
When we talk about freedom to play,
604
00:33:07,946 --> 00:33:13,118
Project Scarlet is the formation
of our future in cloud.
605
00:33:13,202 --> 00:33:16,371
Microsoft meanwhile launching
a video-game streaming service.
606
00:33:16,455 --> 00:33:19,917
All your games can be streamed
right into your phone, or your computer.
607
00:33:20,250 --> 00:33:22,377
The same way the original
Xbox bridged the gap
608
00:33:22,461 --> 00:33:26,673
from early adopters with broadband,
this powerful beast of a machine
609
00:33:26,757 --> 00:33:29,760
that can play games locally,
it's also going to connect to the cloud.
610
00:33:29,843 --> 00:33:32,888
So it will bridge the gap
between traditional,
611
00:33:32,971 --> 00:33:35,516
in-the-living-room local gaming
and cloud-based gaming.
612
00:33:35,599 --> 00:33:38,435
We envision a world where you can play
613
00:33:38,519 --> 00:33:42,898
any game with anyone on any device.
614
00:33:42,981 --> 00:33:46,777
It is the next instance
of what it means to game anywhere.
615
00:33:47,653 --> 00:33:51,823
We're streaming from data centers
around the world to people's cell phones.
616
00:33:51,907 --> 00:33:55,327
We have thousands of people doing it,
in three continents.
617
00:33:55,410 --> 00:33:56,578
Like that's just crazy.
618
00:33:56,662 --> 00:33:59,414
And I'll be damned
if it doesn't actually...
619
00:33:59,540 --> 00:34:01,583
I mean, it works. It actually works!
620
00:34:02,793 --> 00:34:03,877
Where are we?
621
00:34:06,380 --> 00:34:07,506
I'm a big believer
622
00:34:07,589 --> 00:34:11,844
in the technology-access story
of Project Xcloud.
623
00:34:11,927 --> 00:34:14,888
Think about the way
you could unlock community.
624
00:34:14,972 --> 00:34:17,432
One of the things that we were
really focused on with this generation
625
00:34:17,516 --> 00:34:20,978
was making Xbox available
and appealing to the widest audience.
626
00:34:21,061 --> 00:34:23,480
I think we have some
unique responsibilities
627
00:34:23,564 --> 00:34:27,693
to bring people from different backgrounds
into the experience,
628
00:34:27,776 --> 00:34:32,990
and in order for us to succeed in that,
we need to have the right services
629
00:34:33,073 --> 00:34:37,536
and content and creators building things
for all kinds of players.
630
00:34:38,453 --> 00:34:40,455
It's about creating an opportunity
631
00:34:40,581 --> 00:34:43,292
for those that would not
have had it otherwise.
632
00:34:44,084 --> 00:34:45,419
2.5 billion people on the planet
633
00:34:45,502 --> 00:34:47,713
play video games today,
half the connected world.
634
00:34:48,255 --> 00:34:53,093
And that is the scale of opportunity
a company like Microsoft should go after.
635
00:34:53,343 --> 00:34:57,681
Being bold and making bets is part of
the culture of what it means to be here.
636
00:34:58,015 --> 00:35:02,853
I think that's true now,
and it was true from the beginning.
637
00:35:07,858 --> 00:35:11,361
- Where are we going?
- Back to where it all began.
638
00:35:15,949 --> 00:35:17,409
You know, we had some guys at Microsoft,
639
00:35:17,492 --> 00:35:19,453
came and said, "We should do a console."
640
00:35:19,912 --> 00:35:21,914
A Microsoft console?
641
00:35:23,248 --> 00:35:26,126
It's insane to launch a game console
when you're Microsoft!
642
00:35:26,210 --> 00:35:28,253
You made frickin' Windows,
and a spreadsheet.
643
00:35:29,004 --> 00:35:31,006
Bill Gates took a bet on us.
644
00:35:36,136 --> 00:35:39,139
Being able to do something
very different and revolutionary,
645
00:35:39,515 --> 00:35:41,642
was where we were getting our energy from.
646
00:35:41,850 --> 00:35:43,560
Are you ready?!
647
00:35:44,019 --> 00:35:46,146
If you think about
where we were 20 years ago,
648
00:35:46,230 --> 00:35:48,440
when I first moved into the games group,
649
00:35:48,524 --> 00:35:51,610
my dad was horrified
because gaming wasn't a career,
650
00:35:51,693 --> 00:35:53,737
and gaming was something that nobody did.
651
00:35:55,739 --> 00:35:57,407
One of the most incredible things
652
00:35:57,491 --> 00:36:01,912
is this turning point
in how gaming is viewed.
653
00:36:01,995 --> 00:36:04,456
That evolution of people
suddenly seeing the value
654
00:36:04,540 --> 00:36:06,667
of the community that comes with gaming.
655
00:36:06,792 --> 00:36:10,420
There's a fundamental change to the way
we think about human interaction.
656
00:36:10,504 --> 00:36:11,505
There he is!
657
00:36:11,588 --> 00:36:13,173
We can have deep, meaningful relationships
658
00:36:13,257 --> 00:36:15,425
with people a world away
that we've never met in person.
659
00:36:15,509 --> 00:36:17,427
11 years of playing together.
660
00:36:17,511 --> 00:36:19,805
11 years, we finally see each other.
661
00:36:19,888 --> 00:36:23,934
Woohoo! Ha ha ha ha ha!
662
00:36:24,017 --> 00:36:27,354
Even in recent history,
you know throughout 2020,
663
00:36:27,437 --> 00:36:33,151
we saw that people recognized this
as a way to have a social experience,
664
00:36:33,235 --> 00:36:35,195
in a time when we had to be distanced.
665
00:36:36,238 --> 00:36:40,325
The pandemic got people to rethink
how they think about video games.
666
00:36:40,409 --> 00:36:43,829
Children can sit and play
Minecraft with friends and build
667
00:36:43,912 --> 00:36:46,290
and create something and connect.
668
00:36:46,540 --> 00:36:49,710
And at the core,
that's what Xbox is about.
669
00:36:53,547 --> 00:36:57,301
As Xbox continues to grow,
I think it's going to continue
670
00:36:57,384 --> 00:36:59,720
to shape the future
of the gaming community.
671
00:37:00,679 --> 00:37:03,640
It goes beyond how many units they sold,
672
00:37:03,932 --> 00:37:08,896
it goes beyond which generation
they won or were dominant in.
673
00:37:10,731 --> 00:37:14,318
I think a company like Microsoft,
we should stand for something more
674
00:37:14,401 --> 00:37:18,113
than just what place we're in,
and I want Xbox to be around forever,
675
00:37:18,739 --> 00:37:20,073
and I want to be able to look back on it
676
00:37:20,157 --> 00:37:25,078
and say we really used this
opportunity to shape culture.
677
00:37:29,249 --> 00:37:31,668
So I'm announcing the Xbox.
678
00:37:32,044 --> 00:37:34,505
The future of console gaming.
679
00:37:34,588 --> 00:37:40,594
A whole new platform that all of you
are going to take in directions
680
00:37:40,677 --> 00:37:44,139
that we can't even imagine,
and the empowerment
681
00:37:44,223 --> 00:37:47,226
that comes out of this
is going to be amazing.
682
00:37:48,227 --> 00:37:49,770
The power of X.
59014
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