Q&A: Microsoft's Phil Spencer, Part 1

Q&A: Microsoft's Phil Spencer, Part 1

By Michael French and Rob Crossley

September 7th 2009 at 7:30AM

MGS head Phil Spencer discusses the publisherâ??s software strategy

Many would argue that the Xbox 360 has a reputation for exceeding expectations.

With little sign that the console manufacturers will be seriously investing in the next generation anytime soon, the Xbox 360 has already outsold its predecessor by a cool 7 million units, and continues to hold a bigger slice of the market than Sony’s PS3.

More importantly, the 360’s catalogue of games holds with it some of the most critically-acclaimed titles of the past decade.

The console will soon come bundled with Natal, clearly the biggest ever threat to Nintendo’s dominance. At the same time, some of the world’s biggest independent developers – including Valve, Epic and Bungie – remain reluctant to develop for the PS3.

However, despite these triumphs, Sony has around twenty internally-owned studios at its disposal, while Microsoft has less than half that figure. In fact, Microsoft has fewer in-house developers than it did five years ago.

Sony could – like it did with God of War, Ico and Gran Turismo – announce a world-beating internally-owned IP at any moment. It clearly has the workforce, and impetus, to do so.

Develop sits down with MGS head Phil Spencer to discuss how the publisher is aiming to stay ahead of the game.

You became Microsoft Game Studios head a year ago after stint in the UK to found MGS Europe. What’s changed since you took over?
I was in the UK for just under two years and then last year I came back to head up worldwide studios. I’ve been at MGS since Xbox 1 so I had a lot of history with the organisation and Shane [Kim – former Microsoft Game Studios boss, now head of biz dev for Xbox] is someone I had worked with for a while.

When I took the new position there were things I wanted to optimise for – it was about focus. As a first party, we have to be making the big bets that define our platform.

At that point Natal was one of the things we wanted to do and wanted that to be the big focus across the studios; and Kudo [Tsunoda, MGS’s Natal chief] was someone I wanted to place as the real creative director behind all that effort. At the same time I wanted to see the same kind of leadership around Live.

I asked: how can we make the organisation more focused around our key strengths and make sure that all the games exist for a reason? Because it’s easy to look at a game and get focused on its financials or what competitive titles are doing, and justify that project based on the marketplace and what others have done. But as a first party it is important to define our own space.

So I cut back on a few things I thought were nice, but not necessarily strategically aligned with where we were going. That meant also starting to make investment in people and companies working on the areas that were important: Natal, Live and Core games.

I know consumers sometimes get worried about our affection for core games but I am a core gamer – and was a huge fan of MGS titles like Crackdown – so I know what we need to deliver.

I take it that affection for Crackdown led to its sequel. What’s caused the change in tactic? Two years ago you and I discussed how there was no sequel planned.
There’s quite a bit of background to this, but really it’s all about that development team. We own the Crackdown IP and we could have just found another developer out there and done something called Crackdown 2 but as you and others know, it’s one of my favourite games of all time; so I personally wanted it to be special if we went ahead with a sequel.

When Billy [Thomson], the lead designer of the game, left Realtime Worlds there was an opportunity. But at the same time, I consider Dave Jones [CEO of Realtime Worlds and creative director of the first Crackdown] a good friend, and think APB is brilliant – and I didn’t want to undermine that studio.

That meant that when Billy and Gary [Liddon, Ruffian co-founder] formed Ruffian, my first call was ‘Guys, I’m not going to sign this game right now. You need to establish yourself as a studio and I don’t want to be the cause of pain at Realtime Worlds.’

Now, there will always be a bit of tension in that kind of situation, but I’ve since spoken to Dave and Ruffian have turned themselves into a fully-staffed self-sustained studio. And they have the same design and technical people that worked on Crackdown – with that team in place it meant the time was right for Crackdown 2.

But still, the time between Crackdown shipping and the sequel going into production was quite protracted – why was that?
If there was anyone that was a stickler about commissioning a new one, it was me. I didn’t want to just turn the crank.

We sold 1.7m of the first Crackdown and if you also look at the number of Live users and the pre-owned market there are a lot of people that have put in Crackdown and played that game – well over 2m have played it on Live, that doesn’t include the offline numbers.

It would have been easy to chase the money but, again, I wanted to make sure that anything we work on is correctly nurtured. We had to find the right team who really understood what game it is – and that was Billy and the team at Ruffian.

You’ve expanded the Microsoft Game Studios with the acquisition of Big Park and their game Joyride. It’s fundamentally different from other Xbox games; for a start it’s free. What’s the strategy there?
Yes, it’s a great game and a great studio working on it. First-party games should be all about doing the things that other people won’t. So things like Joyride, which will be completely free to play, and titles like 1 vs 100 which we also recently launched, are about finding new areas for Xbox.

1 vs 100 attracts huge numbers – 50,000 people playing a single game, not sharded or on different servers. That’s a different kind of game – something no one has done before. Maybe third-party developers will come and do something similar if we prove it out.

On Joyride, the idea is the same: let anybody come in and play, let the community drive it – we’ll have systems where once all the players hit a collective experience level we will unlock more content. And they can buy new content.

How will that play out? Well, the answer we’ll really find by doing it – it’s unproven on consoles.

Have you taken much inspiration from Kart Racer?
Yes, but the console space is very different. You have 20m people on Live, so it’s not that comparable to just the internet; the dynamics are different and communication is different – we use voice chat for one thing. So we’ve tailored the experience to that, and Gamertags, Avatars and players’ personas play a big part too.

If the game shares some elements with Kart Rider, can Joyride increase the platform’s appeal in Asian markets where Kart Rider is popular? Is that a priority for this release?
It definitely is a priority – global expansion in terms of both hardware and Xbox Live is critical to long-term success. And we’ve got lots of ways to do that. Including different price points – we’re the cheapest console out there, cheaper than Wii, cheaper than PS3 – and different types of content, such as the games which are free to play, or lower priced XBLA games and the full-price retail products. We need to have that spread because consumers in each territory have different values – and today players want to choose their level of immersion and entertainment.

One long-in-gestation product Microsoft has talked about recently is Alan Wake. It has taken a while – most other publishers wouldn’t allow a game to live in the production phase for so long. Why has Microsoft indulged it for so long?
We believed in it. We believed in the team and the idea. Don’t get me wrong –to make a hit property you make a lot of bets, and sometimes you have to shut things down, not because it’s personal or a business decision, for creative decisions.

Microsoft Game Studios is not going to ship 20 games a year – that’s not what the 360 customer needs. It’s not about having the third shelf of decent games – we want the top tier to include our eight to ten games to be a gold standard for Xbox.

And that’s what has been important for Alan Wake. If you’re going to emotionally engage the player in a way that draws them in to build a connection with the story… well that’s something different that not many games are doing today. It was important for us to work with it and support it. And Remedy we value very much. That’s why we closed the software part of the E3 press conference with that game; I was very proud to see it as part of the climax of the show.

Interview by Michael French.