re-posting here because I thought it would be more useful
Following up from the Ed Fries IGN Unfiltered, Interview with Ryan McCaffrey here, worth a watch. He's now a civic engineer helping people achieve work and success and is in the US Olympic Committee, and also has a new book called "Xbox Revisited" where all the net proceedings will go to charity
and some snippets (paraphrased):
on becoming Head of Xbox
On the run-up of the Original Xbox Launch
On driving home to Seattle during 9/11
On J Allard (who Ryan has been trying to find and is apparently on a mountain in Oregon somewhere)
On J and his business plan
On Bill Gates
Fondest memory of Original Xbox
On Japan
On the Xbox 360 naming process
On PS3 launch
On Xbox Live
On deciding against the Xbox handheld
On gaming landscape now
On how he would have launched Xbox One
On civic engineering and old dream of being US Senator
Seeing Xbox as a cultural force
Following up from the Ed Fries IGN Unfiltered, Interview with Ryan McCaffrey here, worth a watch. He's now a civic engineer helping people achieve work and success and is in the US Olympic Committee, and also has a new book called "Xbox Revisited" where all the net proceedings will go to charity
and some snippets (paraphrased):
on becoming Head of Xbox
Well its one of those little things of serependity, were at an executive staff retreat a guy who worked for me, Rick Thompson who ran Microsofts hardware business, mice and keyboards and Barney...if you remember Interactive Barney. And so he raised this question, should Microsoft do a game console? So we had a small breakout session that Bill Gates attended, that led to three or four months of investigation Bill came back to Rick and Steve Ballmer and said "Technically this is interesting do you think it could be a business?" Steve asked Rick to do it, Rick was working for me so im spending 10 percent of my time on this? In December Rick decided he wanted to leave Microsoft, so he went to a startup he helped to fund and suddenly I became head of Xbox, and I went from 10 percent to 100 percent Xbox and from there it became 10 years of love and passion.
On the run-up of the Original Xbox Launch
Xbox was all-engrossing and frankly in bad shape, the run up to the first launch, E3 was a disaster, not because the team didnt work hard but it just was bad. We were leading up to the launch we werent sure the hardware was gonna get done, the software was running in hot, people were just starting to work on real dev kits which was crazy. Once we got past that we started to think about the future of the business, then I had some time to evaluate my life then I thought "I love Microsoft, I love Xbox, Im gonna keep doing this for a while, Im going to play this out" but theres going to be something else that i'm going to want to do and when that time comes ill be ready for it.
On driving home to Seattle during 9/11
Its a great story we are, theres four of us in the car, three from Microsoft and a guy from my church who happened to be in NY. We happened to stop at the Mt. Rushmore Mall in Rapid City, South Dakota. We were stopping because we gotta get food, chinese food that was a bad mistake. So chinese food at Mt. Rushmore Mall, do not recommend it. We got pillows at target, because were driving through the night. As were coming out, its actually called Software Etc. at the time, which then became GameStop. So the Software Etc. clerk called Derek Barnes is in the store and they have all the Xbox stuff up! This was up before shipping and so we started chatting with him and the guy knew alot. He was talking about NFL Fever, who wants to forget NFL Fever? He was talking about Halo, he was talking about other things. And so I gave him my business card he gave my e-mail, we e-mailed for about 10-12 years after. He went onto work at an IT department, had a family, Derek if youre out there contact me again id love to catch up with you. I think one thing did come from that drive home, I just came from this period that I describe in the book where I tried to resign from Microsoft and they wouldnt let me. Nicely, so that was good. And I sort of realized where things fit in the grand scheme of life, when the countrys being attacked and you cant fly and you feel isolated from family. You step back and say, okay, what I do for a living is important, so im going to do it well, but its not worth having a crisis over. If were successful thats great, if we arent successful ill make it successful, but it gave me a little peace, it gave me the ability to get through launch so it was the starting point for me to reshape the next 10 years of my life.
On J Allard (who Ryan has been trying to find and is apparently on a mountain in Oregon somewhere)
Well J and me are both very opinionated, were very stubborn and so he had opinions on stuff that I felt like I knew a lot about, I had opinions about stuff that I KNOW he knew alot about. So there was this Yin and Yang think, I think it was constructive confrontation, we'd butt heads on things and i'd learn a little bit on things and he learned from me. And so it ended up being quite productive, but it wasnt peaceful, our relationship wasnt easy, but it was very productive.
He brought such passion and vision around a concept and an idea, for me as a business guy I looked at things like "Okay, this is a business problem, i have to solve it, I need to sell it, I need to market it" J thought about it as a quest, for J it was like there was a north star and were gonna take the team there, and that to me was a different way of thinking about things and really change the way I thought about leadership. The other thing I learned from J, is the huge power of simplicity, for all of his grand visions and paths that he wanted to take us on, he was a incredible thinker at "No, we just need to do these few things, and if we do these few things the rest will take care of itself" and that to me was a powerful lesson.
On J and his business plan
We had this epic off sight, Peter Moore, J, Myself, few other people. We were basically arguing about the future of Xbox and how to tell the team about Xbox 360, and this was 2002. So its early on, and J said "We need to write it in 3 pages, if we cant write it in 3 pages its useless to the team" and so thats what we did. From that came the 3P framework, Purpose, Principles, Priorities. That I use for the book, I use in my non-profit work and its a powerful simple framework for getting people to focus and to decide whats important and what gets done.
On Bill Gates
Bill is intensely competitive, he and Steve had so much competitive spirit in them so when things happen in meetings and he got demonstrative it wasnt because he didnt like you, it was because he cared, he wanted to win, and he wanted it to be right. What I found in big group meetings, it was hard to manage because he was often right, most of the time right, upset for good reason, so youre trying to manage the team dynamics and work with Bill at the same time, not easy. So I spent alot of time with Bill in smaller groups where he was amazing, just as fierce but at a personal level even more effective. I found when you get to spend time with him he's really smart and quite funny, great sense of humor. Cut with a knife dry wit sense of humor. Look Xbox owes alot to the team and J and other people, but Bill played his role in our success.
Fondest memory of Original Xbox
My fondest memory is E3 2003, its EA on Xbox Live, Muhammad Ali on stage and also we had Donald Trump in a video, doing a take-off of The Apprentice with Sony vs Microsoft. That was a great, fun day. We flew to New York, Donald was there he did it with us and it was Peter, J and me we had alot of fun doing it, Muhammad Ali backstage was incredible. It was an incredible moment for Xbox, we were coming out and people were starting to say "Hey this has some traction" it was personally very gratifying and a very fun day.
On Japan
In the grand scheme of what we were doing, the short answer is I dont think there was more we couldve done to get a strong foothold in Japan, and thats not a strong statement about Japan or Sony or Nintendo. Its just a question of focus, its a question of where you have assets and where you dont and we had no assets in Japan. We had a young team, we were building a team, it became a good team but at the beginning it struggled, we didnt have the relations with japanese devs. A few isolated ones, but even those games were more popular in West than they were in Japan! So deeply in the japanese gaming culture, we just werent there. If I had to do it over again, ironically id do it so we spent just enough to keep us engaged with japanese companies for what they wanted to do in the West, but probably spend a bit less time on it, because it distracted us from things where we had an opportunity to make progress. 360 was much better, still challenged but much better. We had better assets, more crediblity, the senior leadership in the japanese companies turned over and you had a few younger people leading companies who were a bit more western in their thought that made it easier. Final Fantasy came over, 360 did a little better but with Xbox the japanese market its just really hard. I always tell people its the only market we've been in where we've had negative market share, taking more in returns than we were selling in the market (laughs)
On the Xbox 360 naming process
If Peter Moore were here he'd remember the long list, and he was running the marketing team at the time. Certainly 'Xbox 3' was on the list because you gotta catch up! (laughs) You dont want to be Xbox 2 compared to Playstation 3, so we talked about that you dont wanna feel like a generation behind. Windows Office skipped numbers, theres no Windows 9, Microsoft has a long history of skipping numbers so thats the one I remember. We had a naming agency both the original Xbox and one for Xbox 360, in the original case they didnt have anything better than the name we were already using. With 360, it was the best of the names and it felt right. The truth is, on naming, it doesnt matter that much. If you can name something 'the Wii' and sell it in the US and Europe and be very successful, how important can the name be? When that name came out everybody laughed, they made all the appropriate jokes. We probably spent too much time in naming. If you go to Xbox One, all rules are broken right? Who knows what theyre gonna call the next version.
On PS3 launch
The year later didnt surprise us, we knew we wanted to be first, we chose this date in 2002. We said its a 5-6 year cycle, earliest theyll launch is 2005 we have to launch by then. Worst case, we have to be at the same time. As we got closer we werent surprised PS3 was launching in 2006 just because of the complexity of the Cell, that didnt surprise us. The single moment we knew we had real upside was when they announced the pricing at E3, I mean that was a total shock. We knew the product was too expensive but we thought they'd suck it up. They wouldnt let us in for the presentation thats the way E3 works thats fine, so were watching it on some feed I dont know what it was and then Kaz said the price. And the room we were in went silent, and we think "Did he really say what I think he said?" and so we started contacting people who were at the Sony stage to get confirmation that the price was actually real, a lot of actually said in our minds "Oh...this could be really fun." When you have 20% market share and they have 60% you never think youve won, but I did say we have a real chance, if we push hard we can make a difference.
On Xbox Live
It was one of the places we provided real ideas and innovation to the industry, people forget in 2002, Myspace didnt exist. Forget Facebook, MySpace didnt exist. Broadbands in its infancy, so the idea youll have people on a social network online at a regular basis is marginally crazy. Yeah there was online gaming before, if you had somebodys IP address you could meet them, but this was a revolutionary idea. That we'd have a community based gaming experience all online. So theres the innovation point, the second thing is it changed the business model completely so now were not just dependent on selling games, we have a subscription revenue, we have ad revenue, we have retail revenue. All of those things have began to grow and become more important, every year it got more important. It has cost, its not cheap but its sustainable, and it carries from console. They dont disclose the numbers, but my biggest guess is that Xbox Live is the most important part of the business today.
On deciding against the Xbox handheld
On Xbox 360 and Xbox One launchTheres no prototype, there were drawings. Xboy came as a project, it wasnt always called Xboy but it was a handheld gaming device, and the theory was we gotta play in that part of the ecosystem. We didnt do it because we couldnt focus, we didnt have the bandwidth. And Xbox and 360 were so challenged, as it turns out strategically it was a smart decision but thats somewhat accidental, the real thing was "Gosh thats interesting, but we cant do it" I think history proved me correct in one case and lucky in another, correct in the sense that focusing on 360 was the right thing to do, lucky in the sense that forced me to make a decision that turned out to be right because smartphones took that market place, I would not claim we knew smartphones were coming, sometimes you do things for the right reason and it becomes a really good decision.
Yeah the interesting thing is the $399 price for 360 was controversial within Microsoft, that was the first console at $399 so what we did was this dual SKU strategy and so we sorta covered our bases both ways, sales were higher than you think for the premium version. So that was a nice mix, what surprised me for the Xbox One was $499, but what really surprised me was they chose just one SKU with $499 and I know the reason was they wanted to have Kinect in every box, but it didnt leave them a safety net. For us the $299 Xbox 360 SKU was a safety net and considered to be a risky bet at $399.
On gaming landscape now
Its never been a bigger or better business, its now a rich rich form of entertainment, you have e-sports, TV shows, mobile games, PC games, Xbox games, online universes its so cool to see it grow up in a crazy great place. People think consoles are a smaller part of the business, mathematically thats true, but the console markets never been bigger. PS4 and Xbox One have sold more units to date than any previous console gen at this stage, so you look at that and you say wow so, smaller part of the large ecosystem, but a big growing business? Thats really cool, this industrys driven by creativity, and in the creative space you dont know whats going to happen next and the things that do come from the creative side of the house drive the industry.
On how he would have launched Xbox One
Well, there was some things they did that didnt work out, peace, we can decide if those are the right things or wrong things but they didnt work out okay. There were some lessons they should have already learned. But you dont know, when youre in the crucible its all different, theres no objectivity, youve been close to a project for 3-4 years, its your life, you set out with an objective. Its like when you ship a game and people go "Well that was bad game, whyd you ship it?" The answer is "No, I was close to the game, there were things I loved about the game, I thought we were doing the right thing, I thought it could work" nobody ships something they think is objectively bad. Thats what happens, you get close and its hard to pull back. First version of Xbox we made so many bad decisions, I made so many bad decisions, so I try hard to give the Xbox One team grace at that point because its a difficult challenge launching a console.
On civic engineering and old dream of being US Senator
Ive chosen this path, my second act, my second job or purpose in life is to empower other people to get engaged civically, I am an evangelist I want to provide tools and ways for people to think about. I write a blog sometimes its about business, sometimes about civics, i'm trying to get the masses, if you run for office you have a different north star. You have instantly changed from getting people into civics, to getting people to vote for you and that changes the dynamic dramatically. Ive chosen the decision to say running for office isnt what I want to do because I want to have a bigger impact than running for office could have. I trust more in what non-profits can do more than whatever will come out of Washington DC, like Mark Zuckerberg, he has a non-profit and for non-profit purposes and he wants to drive social change. Bill and Melinda have driven social change, the best situation is you get a local problem, you get businesses, you get government leaders and non-profits to work together. Thats how you drive change.
You need a game about this upcoming election! (laughs and talks about current political election that I cant type up because its stuff for the off-topic board)
Seeing Xbox as a cultural force
Its interesting, I have two emotions that compete with each other, one is I think instantly of the team, I think of the people who made it happen, that logo is everywhere because of the work some very passionate people did. And I loved that team, I keep in touch with them, its powerful stuff. And I have some personal pride, theres some part of me that went with that work and contributed in a small way. So its this confrontation of humility in front of the team, because I think they did the work and some personal pride, its a human combination. And its cool to see something like that built. Now im a consultant, then I was a builder, and when you build something its always your baby.
