MS: the battle is over!

**Sventax** · 04-16-2009

INTERVIEW: MICROSOFT'S CONSOLE WAR

Xbox 360 group product manager Aaron Greenberg gives Next-Gen an in-depth view on the console war from Microsoft's vantage point, getting a few digs against PS3 in the process.Microsoft has been lamenting Xbox 360 hardware shortages this year, which the company claimed allowed PlayStation 3 to outsell the Xbox 360 in January and February.

However, the Xbox 360 was able to edge out PS3 in terms of hardware sales in March in the US, according to the NPD Group. But not by much: 262,000 versus PS3's 257,000.

Nevertheless, Microsoft remains utterly confident in the battle against its closest games rival (we'll just mention briefly that the Nintendo Wii sold a mind-boggling 721,000 units during the same month). Here, Greenberg talks Grand Theft Auto IV's impending release and its expected effect on hardware sales, why he believes Microsoft has effectively "won" the core gaming audience at Sony's expense, and how the Xbox 360 hopes to succeed in PlayStation-loving Europe.

Next-Gen: This month, the Xbox 360 edged out the PS3. Does this mean that supply is back to normal?

Aaron Greenberg: Yeah, I think we're happy with where we're at with supply. We definitely started to see improvements in the month of March and that is reflected in some of the sales you're seeing there. We weren't exactly where we wanted to be, but there's definitely much improvement. But we're definitely back in the game, and we're prepared for the launch of GTA IV next month.

But yeah, it's always good, even if it's close, to beat the PS3. For us, one of the things we've said is that we're going to be really careful to watch any sort of signs for the Blu-ray impact, and it seems pretty clear that while Blu-ray may have won, consumers don't care. PS3 sales have actually declined week over week and month to month since the format war has ended. Games are what sell systems, and we feel pretty good about where we're at in that position.

At the same time, PS3 and Xbox 360 sales are pretty much neck-and-neck. How does Microsoft hope to expand the gap in its favor?

moscalloutWe expect we'll end the year with a two- to three-times larger installed base than the PS3./moscalloutSupply. We had a lot of shortages where you couldn't even find Xbox 360s on sale in January and February. That really impacted our ability to effectively market at retail in March. We had retailers pull a lot of circular ads, we weren't being featured in-store. We were on-shelf for most of the month, but the barn was sort of empty. Believe it not, those retail circulars do drive part of the sales. We didn't have that support in March, but we will have that in April and around the launch of Grand Theft Auto IV.

What kind of hardware uptake are you expecting with GTA IV? Are you getting a better picture of that yet?

Actually, it's interesting. Based on what we're hearing from retailers right now, both in the US and in the EMEA, we're seeing our preorders for GTA IV outpacing the PS3's by a 2:1 margin. We've seen some really good signs early on about how presales are going. We think that similar to titles like Madden, Guitar Hero, Rock Band, etc., that GTA will be another multiplatform title that will lead and sell better on Xbox 360, in addition to the fact that we have exclusive content coming.

Back to hardware sales, are you concerned at all that PS3 appears to be keeping pace with Xbox 360?

One thing you have to realize is that this is the time of year when games are primarily sold as opposed to hardware. So it's a slow time of the year for hardware sales. 70 percent of all hardware sales happen in the second half of the year. We think we'll continue to extend our lead over the PS3 over the course of the year. We expect we'll end the year with a two- to three-times larger installed base.

...Frankly, we'll see most of the growth in the second half of the year. Titles like GTA are the exceptions to that rule. We think that title will help move hardware sales when that launches.

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