How Xbox's Red Ring of Death helped fuel console war marketing

Peter Moore, former executive at Xbox and accessory to the death of the Sega Dreamcast, owned up to helping fuel the console wars during the era of the Xbox 360. Speaking plainly on the Front Office Sports podcast (via IGN), he admitted that his team encouraged the conflict between players of the Xbox 360 and Sony's PlayStation 3. 

Console wars have been a part of the games industry for decades, and while some developers just want to focus on the games, a console maker such as Sega and Sony have had no trouble playing into that division to promote its own console. 

For Moore, the reason for a console war was simple: to drive competition between Xbox 360 and PS3, "not to create division, but to challenge each other," as he put it. This competition was extra vital, according to him, as the 360 was in the midst of its Red Ring of Death hardware bug. 

Had Microsoft gotten out of the games industry following the hardware debacle, "Gaming would be a poorer place for it," said Moore. "Two big behemoths like Microsoft and Sony investing billions of dollars each is good for gaming." Though his focus was primarily on Xbox and PlayStation, Moore was also happy to bring up Nintendo's booming success with the Switch. "The industry's never been healthier."

The Red Ring of Death was an error code prevalent in Xbox 360 consoles, caused by the failure of one or more internal hardware components, that would render it completely unplayable. Moore, then-VP of Microsoft's interactive entertainment business division in 2007, announced a three-year extended warranty for every 360 console from date of purchase, and instituted a repair or replacement program for those affected said to have cost Microsoft an extra $1.15 billion.

Moore helped launch the Xbox 360 in 2005, and is maybe best known for revealing the release date of Bungie's Halo 2 via tattoo. He later left Microsoft to become the head of Electronic Arts' sports games division, then departed EA in 2017 to become the CEO of Liverpool Football Club.

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Since Moore left the games industry, competition has expanded into a larger digital ecosystem encompassing games for mobile players of all stripes and games from unexpected sources such as Netflix. 

For Microsoft, its Xbox Game Pass continually increases, even when its overall video game business takes a small bruising during quarterly financials. Game Pass has been so successful for Xbox that Sony's attempting to have its own subscription-based revenue by tweaking its PlayStation Plus program.  

Another form of competition between Microsoft and Sony has been about acquisitions. In recent years, Microsoft has been acquiring as many studios as possible, from decent-sized companies such as Obsidian Entertainment to entire publishers like Bethesda and Activision Blizzard. 

Sony has also been acquiring studios, but not quite at the rate or scale of Microsoft. It acquired Bungie earlier this month, though its plans for Bungie and its sci-fi shooter Destiny may extend more to the realm of television and film. Another recent acquisition was in the form of Haven Studios, co-founded by Ubisoft Toronto's Jade Raymond and at work on an original IP.