Happy 10th Birthday, Xbox?

Okay, it hasn't been 'available to buy' for ten years but I feel the Xbox story starts before the release of the original console. I'm sure you have all noticed that the article title contains a question mark. This is very much intentional as I intend to determine the answer to a simple question... Have Microsoft ultimately failed with the Xbox gameplan?

Many of you will scoff at the question and dismiss it out of hand saying "Of course not! The Xbox, and especially the 360, have done amazingly well." Some of you might even accuse me of going on a pure "anti-Xbox" rant with this article so I'll go with the usual disclaimer by stating "I already have an Xbox 360".

The Xbox console - 2000 to 2006:

Yes, the original Xbox console didn't get released 'til late 2001 but I think the story truly starts with its unveiling. As soon as that behemoth was shown, Microsoft lost most Japanese interest almost immediately with such a console. Not to mention the controller. With Japan being the biggest game market in the world at the time, not to mention their home grown PS2 hitting the streets earlier in the year, it would have taken a miracle for Xbox to have hit the floor running in Japan. Especially when, at the time at least, such a large proportion of high quality games came from Japan (you could argue that this has since changed completely but that's another debate).

To counter these concerns, Microsoft spent millions of dollars in order to coax developers, particularly Japanese developers, to work on their new console. This did work out quite well from a gamers perspective with some great exclusive games coming from the east such as Dead or alive 3, Gun Valkyre, Otogi, Panzer dragoon Orta and Outrun 2 to name a few.

However, with the exception of the dead or alive series, none of these games truly set the sales charts alight and I'd personally suspect that their sales would not have covered the costs of advertising to Japan and tempting developers. Let's not forget that $375 million spent on buying Rare from Nintendo only to get two games out of them (the decidedly average 'Grabbed by the Ghoulies' and a heavily cut remake of N64 comedy platformer 'Conkers Bad Fur Day'). We also can't gloss over the impact that piracy would have had on the console - the console was almost embarrassingly easy to soft and hard mod with Linux ironically bringing out the best of the console.

There are a number of reasons that the Xbox was successful with the "hardcore" gamer though. Aside from a PSU replacement program in 2003, the hardware was exceptionally reliable. Oh how the Microsoft of today would love to have a hardware reliability rate even remotely close to the original console - more on that shortly. Also, when Microsoft got it right, they really got it right - Would the Xbox brand even exist today if it wasn't for a certain game by the name of Halo? Quite possibly, no. Love it or loath it, there is simply no doubt that Halo is THE MOST IMPORTANT release in the history of Xbox and its impact is unquestionable.

But it is just one game and it could never be expected to carry the console for its entire lifespan. There are two elements that kept the Xbox truly alive. The first was the gamecube - Nintendo lost a lot of credibility among traditional gamers (despite hosting some truly high class software) with its "kiddy" image and it's continuation of "quality, not quantity" - a policy that starved the N64 of games for most of its life and evidently did the same for the cube. Nintendo shooting themselves in the foot repeatedly is one of the key reasons Xbox secured second place so easily (especially in Europe). But the biggest card Microsoft had is arguably THE reason the original Xbox lasted as long as it did - Xbox Live.

Sega we're the pioneers of console online play (up to 6 billion players apparently) with some excellent online titles such as Phantasy Star online and Quake III Arena and a load of downloadable content for some games (and all for free too). Ultimately, seganet/dreamarena was always going to be quite limited through dialup. Considering the fact that Xbox live was a subscription service could have been a fatal decision but this only serves to show how fantastic the service actually was. Genuine, almost PC quality online play right on your console - simplified yet using the latest in internet technology. And a shed load of high quality online software which, thanks to the cloud nature of the service, would ALL remain online until 2010!

If it weren't for these two factors (especially Xbox Live), I truly believe that Xbox would be nowhere today as PS2 was just so dominant. Overall, in the eyes of most western gamers, Xbox was very much a success and the Japs didn't know what they were missing with so many high quality games passing them by. To Microsoft though.....

The Xbox 360 console - 2005 to 20??:

.... the original Xbox was nothing short of a gaping hole in the bottom of the jeans pocket that is Microsoft's coffers. Microsoft decided rather early that they wanted to turn a profit on the Xbox 360 console at some point (something they had never done with the original Xbox console). Microsoft were lightning quick when it came to ending the original Xbox's life and Microsoft almost acted like they were ashamed of their original console. Look on the Xbox marketplace - the "Xbox originals" range was fairly shortlived and involves a lot of searching nowadays to find the likes of Halo 2 et al. And look on Xbox.com right now - you won't even find the backwards compatible list anymore (in fact, there is one link just explaining that MS do not support the format in any category anymore). I found this most unusual as Playstation 2 showed just how effective having backwards compatibility was in convincing those millions of PSOne gamers who didn't want their games collections to be redundant to upgrade.

It is truly amazing that the Xbox 360 is still out today when you look back on the last five years as Microsoft seems to have made mistake after mistake with the console. Right off the bat, it needs to be mentioned that the Xbox 360 was an extremely rushed product. Whispers of it in Feb 2005, an E3 showing in May 2005 and released worldwide by December 2005, it's quite clear that it was a rush job. This has been catastrophic for MS - In order to keep the costs of the console down, MS cut some very significant corners - all of which would come back to haunt them over the next few years. Their distribution of the Xbox 360 was immensely poor - due to its rushed announcement and release, there was an extremely limited supply for Christmas and this shortage lasted until well after March of 2006. Preposterously, they committed a sizeable number of units to Japan in order to win them over - leaving the US and especially Europe with short supplies while having slight sales in Japan and a load of surplus stock.

I've mentioned that MS cut significant corners with the console. One of the most notable was the initial lack of a HDMI port on the 360 with MS stating that VGA and component are more than adequate for 1080p (VGA probably, component no) and adding HDMI would only make the console price higher. Really though, it was simply the fact that MS did not want to pay the HDMI group in order to use the technology. They eventually had to do a not so discreet u-turn on that yet they did not compensate the early, HDMI-less adopters on the basis of the VGA/Component argument (they carefully said that they considered HDMI as merely another way to connect the console and is not a true upgrade). On a related side note, 1080p was not 'enabled' on the console until well after its release. And there was no in built wifi. And the half arsed backwards compatibility. And the accessories have been unbearably restricted and overpriced thanks to the software drivers for 360 being ridiculously tightly controlled. 360 HDD prices continue to be joke even today.

Another huge mistake was the lack of a built in HD-DVD drive. Microsoft always maintained that they see digital downloads as the future and didn't believe that either HD-DVD or BluRay would prevail in the long run. This is directly contradicted by the fact that they released the HD-DVD player as a standalone device anyway - If they truly thought that, why did they bother with it? And the fact that this standalone player cannot play games is a major inconvenience as it is the only drive on the 360 that does not destroy your discs at the slightest movement. More on that shortly....

Yes, adding a HD-DVD would have ramped up the console price a bit but, despite initially slow sales, the significantly higher priced PS3 has proved to be rather successful in the long run (despite the cost of having BluRay as standard). I would argue that if 360 had HD DVD from the start, the BluRay (and PS3) would never have got a foothold - HD DVD would likely still be around in all those sold 360's. Let's not forget how 360 had that 15 month head start. Not to mention the apparent storage difficulties that game devs are apparently having with the old DVD format. But I won't go too in depth into the HD disc format war despite the significant impact I believe 360 had on it.

So let's move on to the other problems with the console. A huge one is the disc scratching issue. The disc scratching is not strictly a hardware fault. A 360 doesn't just develop a disc scratching fault out of nowhere - it's either born with it or it's not. However, while it is not strictly a hardware fault, it certainly IS a design fault of the 360. The space in the 360 drive for a disc to spin is extremely narrow. When the console is standing vertically, the DVD drive is higher up from the surface that the console is sat on. Because the base is so narrow when the console is stood up, the DVD drive makes it quite top heavy and, because 360 discs spin so fast, this can eventually cause the console (and disc) to wobble. It wouldn't be that noticeable to you but, considering the narrow gap in the tray between the read head and the spinning disc, even the slightest of wobbles can cause the dreaded circular scratches. Keeping your Xbox horizontal is much healthier overall (though MS can't admit that as it would indirectly be admitting to a design fault). Notice how all marketing materials have the console aligned vertically? Causes MS all sorts of problems.

And all of this stems from the cost cutting of the 360 mentioned above. Apparently, MS didn't include rubber bumpers worth 25 cents per console as it would have cost them millions (ironic that the repair and compensation programs for their cost cutting eventually cost them the same as if they had included the bumpers from the off.... only with less negative publicity). To get around this issue, Microsoft released the NXE dashboard. Aside from stupid Mii rip-offs and a new layout, the NXE update brought nothing new to the Xbox 360. Well, almost nothing. They included the ability to install games to the HDD. I contest that this was purely to reduce the number of discs spinning around the world and give themselves a bit of wiggle room from the responsibility of their poor hardware design. I genuinely can't see any other notable features that made the NXE dashboard necessary.

And then the big one - the so called "red ring of death". Specifically, the three red ring problem. Let's be fair - every high tech electronic device is bound to experience some sort of problem eventually. However, there were reports that a MASSIVE number of 360 users were experiencing the red ring problem. And the worst part? Microsoft would not entertain the possibility that this was happening and were refusing to perform complimentary repairs. 15 months after the reports (and after a number of investigations, exposes and lawsuits), Microsoft eventually acknowledged the fault and offered an extended warranty for this problem (and the e74 one light problem too). It's extremely sneaky, greedy and arrogant that Microsoft has to basically be threatened of legal action by governments and the EU before they act.

On the plus point, the 360 'S' console has addressed most hardware errors but, in my eyes, this isn't good enough (and it still scratches discs). To be frank, the Xbox 360 'S' (with a built in HD DVD drive and those rubber bumpers) is the console we should have got 5 years ago. If we had, I truly believe PS3 would be already dead by now. But that's yet another debate....

So why am I mentioning all of these problems? Well, any slight profit MS have made on 360 hardware (if any) will have likely been completely eliminated by the repair and compensation claims due to the shoddy 360 hardware. Like the original hardware, the 360 hardware probably hasn't made MS much money (if any) so once again, it's ultimately been Xbox Live and Halo to the rescue (with Gears of war providing backup).

Don't look at this article as a rant - I absolutely adore the range of games available on the 360 and was a massive fan of the original console too - It was the perfect Dreamcast hangover console. But let's be honest, if the console was brought out by almost anyone other than Microsoft, they would probably have thrown in the towel by now (at least when it comes to hardware). Of course, the quality of Xbox live cannot be underestimated and is the one thing that MS have unquestionably got consistently right.

Xbox today and the future:

So, after 5 years of consistently being second best to Nintendo (despite churning out far superior software and services... but not hardware), Microsoft have decided that they want what Nintendo have. They have rebranded their definitions of the types of gamers out there and are ready to go (I won't go into these definitions here). Enter Kinect for Xbox 360. Once again, they have made a number of crucial mistakes with this accessory. For a start, they are looking at (and basically marketing) the Kinect like its new hardware. It just isn't - it's a fancy console accessory and nothing more. Then there's the software and marketing. Microsoft have spent 9 years building up a loyal following of "traditional, core gamers" for the Xbox and, in the space of six short months, they have completely changed direction in the hope that they can capture "that Wii audience". This is an audience which already has a Wii and are rather happy with it yet Microsoft hopes they can be persuaded to part with £300 of their hard earned (in the midst of a world recession) to go for a Kinect + Xbox 360. Especially when you look at the vast amount of negativity built up over the years over the hardware problems i've outlined above.

As for Kinect, while it's started out relatively well, I can't see this doing the business in the long term (and certainly nowhere near the five years MS seem to think it will last). Let's look at some simple truths: Us "traditional" gamers are probably every bit as effective at marketing the Kinect to the intended audience just as well as $500 million ad campaign and a plug on Oprah. After all, we are the enthusiasts (not to mention the people who usually end up setting it all up for the parents/aunties/uncles/grandparents etc... so Microsoft should really be selling the Kinect to us first. After all, nobody shouts louder about the virtues of games than us gamers ourselves.

But no! Microsoft has completely frozen us out of the Kinect with ZERO launch games to appeal to us. Have any of you actually played with the Kinect in depth? I have. Yes, Dance central is a great bit of craíc but certainly not £130/€150 worth. And yes, Child of Eden looks great but I would argue that, with the force feedback, it will be better played on a controller. Speaking of which, the Kinect will never, EVER be a replacement for the controller. EVER! Sure, there are some people (including MS themselves) who say that the "hardcore" games are coming (18 months after launch as stated by MS themselves - WTF!). But this won't happen. By its very nature, the Kinect will simply not be able to host the challenging, interactive games we've all come to know and love and WILL end up with some interesting ideas and a load of shovelware at best. On a side note, a device which specifically encourages people to jump and move around + a device which is known to be extremely sensitive to even the slightest vibrations = a whole load of trouble for MS going forward with the inevitable scratched discs claims.

In my humble opinion, MS would be better off simply marketing the device as the accessory it truly is (a souped up eye toy) and focusing on games which utilise both the Kinect and the controller so that they can easily wash their hands of it if (when) it does eventually flop. You might find this to be an extreme step to take but it's a well known fact that there has never been a commercially successful console 'add on' in history - Why do people think things will be different for MS?

So, what next for project Xbox?:

It's only a matter of time until a 'real', new Xbox is announced (within 18 months I suspect). After all, anyone can see that the hardware is looking quite aged nowadays (especially when it comes to optical storage). The next generation is going to be extremely difficult for Microsoft though and they have some extremely tough choices to make with regards to a disc format (they can forget about their beloved download only future for at least ten years). Should they go for BluRay? Even Toshiba, the primary backer of HD DVD, humbly applied to join the BluRay disc association in 2009. And they were accepted with open arms by the association. However, I can see Microsoft being quite stubborn about it though. In fact, part of me thinks this is why we have still not heard of an Xbox 3 announcement. So what else could Microsoft do? Well, either they could use the HD DVD format exclusively (surely the rights and costs are practically worth zero nowadays as the HD DVD group have been disbanded since March '08). This would certainly make their next console adequate (though not amazing) in terms of optical storage but they would alienate all those bluray owners from picking it up (and HD DVD as a movie format is dead - never to return).

The only other alternative is if they went for one of the future proposed disc formats such as SVOD or HVD (Thank you, Wikipedia) but these formats aren't ready yet and kind of look a bit too big IMO. Another option would be to go with the China Blue HD Disc (CBHD) which (again, according to Wikipedia) is roundly trouncing Bluray in China by 3 to 1 and has the support from many major studios including, ironically, eventual HD DVD killers Warner (and lets not forget that China will basically own the world in the coming years.... and I for one welcome our new overlords). These suggestions are the only way for MS to save face but, really they should just take it on the chin and humbly grovel to the Bluray disc forum. Yes, they'll lose a bit of their self respect but it will pass. A download only future will see a massive drop in purchases from users on certain bandwidths especially if we're looking at tens of gigs per game.

Also, while Xbox live is clearly THE SUPREME online console gaming service in action today, Playstation's PSN service is getting better and better and its price tag of zero is looking more and more appealing as time goes on. It's only a matter of time until they have a reasonably comparable service and then what, MS? Coupled with its chosen disc format and infinitely more reliable hardware, it could leave MS in a bit of a mess.
So, from the above, we have determined that Microsoft is indeed a high quality service provider but not an especially good hardware vendor. They made no money on the original Xbox console (apart from Live and Halo), they made little money at best with 360 (apart from Live and Halo... and a few others) and we know that their next console will need to have significant cash invested into it to ensure it is reliable, up to date and has an adequate disc format. Hopefully, they won't neuter all our beloved terabyte hard drives and Logitech G27 wheels again.

It's a pity, then, that they couldn't just run Sony's online service and leave the hardware to Sony (and If Nintendo want to come back from wherever they are gone, all would be rosy). I can see a scenario like that developing someday but that's another debate.

So, for the initial question...... Yes or no? Overall, i'd probably say yes. But not as much as MS would have you believe.....


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mfnick's picture

Thats one hell of a write up. Will be sure to read it fully later when I have chance.

Subject Nine's picture

The BC fiasco was due to developers taking short cuts and directly addressing the hardware rather than the API layer meaning they had to rewrite code to get it working. Short sighted from MS with the original Xbox but not a fault of the 360. They've addresed that with the 360 and won't pass a game for certification if it doesn't address the API layer correctly. I'll have to read the rest before commenting more.

mfnick's picture

Good read noob. After reading this I really am surprised the 360 is as successful as it is. Obviously I know of al the problems with the 360, but having them set out like this really makes it hit home what a fucked up console it is.

As for treating Kinect like a console launch. I think they had to. Without the half a billion dollars marketing & huge push it would have definitely failed. Now they are currently looking at a huge success. How long it will last though is anyones guess.

Lets remember that I have focused on some of the more negative aspects of the console hardware. In terms of software, their range is still second only to PC. However, they have spent considerable cash on certain exclusivities such as COD map packs, GTA IV DLC etc...

I'm sure patriotism will have made a big impact in the states too...

That was a great read mate,well done.

i personally think ms will be around for along time but ms along with alot of gamers,critics thought they would kill off sony by beating them to the market and it just hasn't happened.

OK their still ahead of sony but by how many units?like you said they had a 15 month headstart and that lead is now down to a few million which is miniscule and will be overtaken by ps3 within the next 18months i think.The ps3 brand is extremely strong and i can't see it ever giving up and folding.To be fair ms have done an excellent job making the 360 popular with a superb if genre limited library but are they willing to alienate their core base to gain those dollars their missing out on in the casual market?

I think so and sadly if they do they could be the one's playing catchup in the next generation.

I think it's been a success, even if it will eventually finish last in the console race. They just wanted a slice of Sony's Playstation pie and they got a hell of a chunk of it. MS are probably more pissed that Nintendo took a different, cheaper route and walked away with this gen which is why they're going for the casual crowd with Kinect.

theBishop's picture

Good read. I can see MS being in a very difficult place next gen. It'll cost them a lot of money up front to bring them up to date.

Bryanee1983's picture

Good article, they really didnt secure second place last gen that easily though the Xbox only sold 3 million more than the Gamecube.

Sir_Loin_Ofsteak's picture

Re: Happy 10th Birthday, Xbox?

Great read man!

I don't fully agree with the kinect bit though - the thing is that it has a lot of different practical applications in things that MS originally never even dreamt of. In my opinion it WILL continue to sell, but not because of its games, rather because it makes for an excellent cheap solution for things like robotics. If they push that aspect and allow people to develop new applications, who knows where it will go? MIT students have already got it recognising fingers (rather than just hands) and certain unis in the UK are using it to get their robots wandering about. Might not sound like much currently, but if someone figures out an area where it could be really useful and MS licenses the tech...who knows?