Scott Hillis
SEATTLE: Microsoft Corp.'s Xbox video game console is not selling as well as
expected in Japan, though the software giant says customers there and around the
world are buying more games than they did for Sony Corp.'s PlayStation 2.
"Japan is going well on the software side and probably is a little
behind where we want to be on the hardware side," Xbox director Robbie Bach
told Reuters in an interview.
"But we always expected things would be tough. Microsoft has
demonstrated patience and persistence there before and I think we will do very
well," Bach said. Bach declined to give specific sales figures or comment
on a gaming magazine report last week that said the Xbox had seen a slow start
in Japan, with sales of just over 190,000 units since its Feb. 22 launch.
By contrast, Sony's market-leading PlayStation 2 sold 980,000 units in just
three days when it launched in Japan in March 2000. However, Bach pointed to
software sales as evidence that the Xbox was gaining popularity around the
world.
Game sales are crucial because they are highly profitable, unlike the Xbox
hardware, which Microsoft sells below cost in order to keep consumer prices
down. Japanese customers had bought an average of 1.6 games per Xbox so far,
compared to one game per PlayStation 2 at the same point after its release, Bach
said.
Bach said he was confident Japanese game developers, many of whom are said to
be highly suspicious or even hostile to Microsoft as it tries to crack a market
dominated by Japanese firms, would eventually fully support the Xbox.
"We're seeing lot of strong support there. We expect our relationships
there to grow. It's not something you can jump in, and in three weeks you have
great relations with everyone. It takes three months, or three years," Bach
said. "There is still more work to do in Japan."
Growing the installed base
In the United States, where the Xbox debuted last November, customers had so far
bought an average of 3.8 games, while in Europe, where the console launched
about three weeks ago, they had bought 2.3 titles, Bach said.
"It really speaks to the strength of the games, the breadth of content,
and in the end it really is all about the games," Bach said. Moreover, the
Xbox's premier game, a science fiction combat title called "Halo", had
now sold 1 million copies worldwide, reaching that mark about twice as fast as
the top PlayStation 2 game, Bach said.
The second-biggest seller was street racing game "Project Gotham",
with about 500,000 units sold, while martial arts fighting title "Dead or
Alive 3" was in third place, with sales of about 400,000, Bach said.
However, the video game market was expected to slow in the middle of the year
before getting its seasonal boost in the fall as the industry starts building
buzz heading into the holidays, Bach said.
Microsoft would preview several upcoming games at the main video game
industry trade show in May, as well as reveal some of its plans for starting
launching online gaming, Bach said.
"The critical next step for us is scaling the platform from being a
successful launch to being a broad-based success with a big installed
base," Bach said. "The second thing ... is our online plans. That
should be very infesting. We have some fun things to talk about, some fun things
to show."