Microsoft to launch Xbox on Nov 8

Scott Hillis

LOS ANGELES: Microsoft Corp. will launch its $299-worth Xbox video game

console on Nov 8, the software giant said on Wednesday, using the crucial

holiday season to challenge industry leaders Sony and Nintendo for dominance in

the $6.5 billion-industry.

The launch date gives Microsoft just a few weeks to build a buzz around the

Xbox before the holiday season, when it needs to make a big splash in the race

to catch up with Sony Corp.'s popular PlayStation 2. Nintendo Co. Ltd. is

launching its next-generation GameCube console around the same time.

But despite the competition, Redmond, Washington-based Microsoft said it

expected to sell from 1 million to 1.5 million Xbox consoles through the

holidays.

"Neither one of us (Microsoft and Nintendo) are going to have any

trouble selling hardware this holiday season," Robbie Bach, Microsoft's

"Chief Xbox Officer", said in an interview at the Electronic

Entertainment Expo (E3), the video game industry's annual trade show.

The Xbox entry is controversial because some analysts doubt the market can

support three different platforms, pointing to the failure this year of Sega

Enterprises Ltd.'s Dreamcast machine.

Microsoft plans to back the Xbox with $500 million in marketing over the

first 18 months, making it the company's biggest product launch ever. It expects

to have 600,000 to 800,000 units on store shelves for the Nov 8 launch, Bach

said. He touted the game's high-powered hardware, which will let players compete

with each other and talk to each other online. He also said he did not expect

the kind of production delays that plagued the launch of Sony's PlayStation 2

last year.

"The components are all there. We don't expect any bottlenecks.

Everything is going really well," Bach said. The price tag is in line with

the $300 that analysts had expected. Console makers sell the hardware at a loss,

hoping to build a user base quickly and then make profits on the games. A lower

price makes the machine a more attractive buy, but means a bigger upfront loss

for the company. Conversely, a higher price cuts initial losses but could put

off cost-conscious consumers.

Based on the same technology found in a personal computer, the Xbox is a new

entrant into the console market dominated by the PlayStation and Nintendo's N64

system. Nintendo was expected to announce details of its all-new GameCube system

later on Wednesday.

Microsoft boasts the Xbox hardware will outperform both the PlayStation 2 and

the GameCube, but analysts said all that power won't do any good unless software

developers make great games that are fun to play. Bach said Microsoft will have

about 15 to 20 game titles for the Xbox launch, and it has dozens more lined up

for launch in the following months.

Bach also highlighted Microsoft's plans to develop online games for the Xbox,

promising players will be able to join an online game with a single click and

will be able to talk to each other while playing. Microsoft's online plans

contrast with those of Sony, which on Tuesday announced a deal with AOL Time

Warner Inc. to let PlayStation 2 users access the Web, chat and send e-mail

using the AOL service.

"All you have to do is ask game players what they want. People don't

want to send e-mail from their couch, they don't want to browse from their

couch, they want to play games," Bach said in an interview on Tuesday.

"Our online environment is about games, it's not about e-mail, it's not

about other things, it's completely and totally focused on games," Bach

said.

(C) Reuters Limited 2001.