Microsoft's Greenberg: We're Less Than Halfway Through The Console Cycle

Sales of Xbox 360 in the U.S. reached 241,000 units during the month of June, a 9 percent year-over-year increase -- but Microsoft's hoping the industry takes a macro view of the first six months of 2009. "Our console sales for the first half of the year actually grew 20 percent from January to June versus the same six months last year," Microsoft's Xbox 360/Xbox Live group product manager Aaron Greenberg tells Gamasutra in an interview conducted alongside the June 2009 NPD results. "We're the only console that grew in the first half of the year." For Microsoft, this means more than evading the "industry slump" created by the challenging comparisons to last year's summer blockbuster release months. According to Greenberg, this continued growth is evidence of the Xbox 360's market duration. "I think what's interesting there is we were the first to market, so in many ways we're showing a lot of longevity," he says. And part of that, Greenberg claims, is attributable to the burgeoning online marketplace, which NPD numbers do not track. "Xbox Live data is kind of this untold phenomenon," says Greenberg. "There are 20 million people there, but what are they doing? Are they buying more stuff?" This month, the company's got data to share: In the first half of the year, Greenberg says paid downloads increased 73 percent over the 12 months through June. "That significantly outpaces what we saw in growth for console sales or software sales," says Greenberg. "It's continuing to become a bigger and bigger part of our business." Alongside the growth of digital distribution in the games industry has come a focus on user statistics, which are often in danger of falling into a fuzzy math zone. Many online services post high numbers of accounts, but that sheds little light on their activity levels, what they're downloading and what they're spending. But Microsoft's got a little data for that too: 17 million unique users out of Live's 20 million actives have downloaded content over Xbox Live, although the stats don't get more granular than that regarding their quantity and frequency. "Content" also includes the service's television and movie content, now totaling 12,000 movies and TV shows. Having sold nearly 250,000 units in the U.S. in June 2009 despite the downturn -- significantly more than the PlayStation 3, but less than the Wii -- Microsoft is relatively happy with its growth at this stage of the console war. But this prompts the question: Just where in the present console cycle does the company feel we are? "We believe we're less than halfway through this generation," says Greenberg. His stance is that now that price points for the platform are more affordable, adoption can accelerate -- but that the console's success is attributable to "the sum of the parts," and not only its price positioning. Greenberg says audiences are excited about the software lineup demonstrated at E3. "Beyond that, Natal is really going to make the console much more accessible to a wider audience," he says. "We're focused on delivering new experiences, some this year and some beyond. Our belief is that we've got a long future ahead of us." By expanding the user interface, Project Natal then becomes a major part of the console's next stage of growth. But with rival Sony preparing its own alternative control scheme, is there a race to market, and will it make a difference who hits first? "I don't think so," says Greenberg. "I think they're pretty distinctly different. Everyone asked if we could do a motion controller -- that's something we could have easily done. But we really challenged the team to think beyond that." The big idea behind Natal is "delivering these experiences that will allow us to appeal to a much broader audience -- people that are intimidated by the controller, and intimidated by video games," he says. "So it's an apples and oranges type of conversation." But capturing the early adopters in the core market first, and then expanding outward to ever more mainstream audiences has always been part of the company's strategy, says Greenberg. "We started in the inner circle, and we'll continue to deliver those core experiences... going after them first was important," he explains. "I think for Sony, what in many ways kind of threw them off that strategy was what happened with the PS2 and the DVD player phenomenon. They kind of expected that to happen with the PS3 and the Blu-ray." Sony's current trend toward focusing somewhat more on the AAA gaming experience is "probably the right thing for them to do," says Greenberg. "For us, we're demonstrating there's an entirely new way to think about Xbox 360." Calling focusing on core gamers "the easy stuff, and we'll do that," Greenberg asserts: "We're not just a game console anymore." Heading into the holiday, Greenberg says he's confident about the lineup of games launching on Xbox 360, from exclusives including Forza 3, Halo: ODST and Splinter Cell: Conviction through desirable multiplatform titles like DJ Hero and Rock Band Beatles. Still, he says it's hard to say whether the economic challenges the industry's been facing will let up. "We've kind of bucked the trend of the declining market," he says. "I hate to promise or speculate what the second half will be for us or for the market, but I think it will be tough comps for the entire industry, and we hope we can continue to buck that trend, too."