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Microsoft's Kim: 'Our Competitors Don’t Recognize The Importance Of Relationships'

As part of a wide-ranging opening keynote at the ongoing Vancouver International Games Summit, Microsoft Game Studios head Shane Kim contended that the company had an advantage with third parties because "our competitors don’t recognize the importance of
At the Vancouver Game Summit, Microsoft executive Shane Kim delivered the keynote - in interview form. The Microsoft Game Studios boss was quizzed by The Electric Playground co-creator Victor Lucas. Reaching A Bigger Audience "It’s great to see the momentum continue after the holiday season," said Kim as the interview kicked off. He pointed to various figures of Xbox 360's success, such as its recently-announced 10 million unit sales mark in the U.S., 19 million units sold worldwide, and 12 million Xbox Live users. Kim noted that the "vast majority" of that 12 million are Gold subscribers, but could not quote specific figures. Lucas followed up by asking whether the industry is moving away from its traditional holiday focus, pointing to Grand Theft Auto IV's spring success. Responded Kim, "The industry has to believe that as possible. The power of Grand Theft Auto resonates that really great content can succeed any time of the year. Clearly, the big hits will still stand out during the holiday season, but there are lots of opportunity for people to think about the rest of the year." On whether games are becoming more mainstream, he said, "We still have a ways to go, but the fact that the launch of Halo 3 or Grand Theft Auto IV has raised the awareness of this industry means [we’re coming up] on appealing to a broader audience. "There are people that don’t understand games and feel it’s still the domain of men aged 18-25," he went on. "But the more we focus on games outside of the boy’s room, the more we'll [grow]. We’re training a generation that will not stop, and people will just assume this is a part of the way their lives should be." Speaking on whether video games represent just one more way to tell stories, Kim indicated developers should concentrate on that direction. "I think interactive storytelling needs to be more a part of our industry," he said. "I think we’re still working to tell stories through games. We’re fortunate enough to be working with Peter Jackson. What we really want to do is marry world class storytellers with interactivity.” Lucas brought up recent statements by Rockstar Games' Dan Houser, who voiced his distaste for casual gaming, and suggested that those unfamiliar with more hardcore games could enjoy them if they gave them a shot. Kim didn't entirely agree, but echoed parts of the sentiment. "I don’t have much patience for trying to categorize people. People in general will enjoy interactive entertainment," he said. "We still have to be realistic. Even though BioShock is beautiful, it’s not going to appeal to all people. There are amazing elements that are a part of those titles that can be used in other games." Lucas asked whether creative authorship is important in games, and Kim indicated he believes it is. "There is an awareness of company identity behind games. BioWare, for example," he pointed out. "I do think that the studio as a whole represents the property. Games are all about the art of creating art. You need to rely on the creative leaders." The First Party Mandate On Microsoft Game Studios' role, Kim explained, "Our job, for the last four or five years, has been to become a first party that drives a successful platform. It’s very expensive to develop the high-end multiplayer HD content. It’s very difficult to rely on third party for these reasons - GTA is an exception. It’s not a matter of quantity, but a matter of quality. We really try to do things we believe in." Kim indicated that acquiring external developers is not something "to look at lightly," but it is on the table. "That's always an option for us," he said. Lucas brought up Rare, which many have seen as an investment that has yet to justify its record-setting $300 million price tag. "Investment is a great way to put it," answered Kim. "One thing that’s always characterized Microsoft is that we invest long-term. Usually by the third version we get things right. Rare has an extremely powerful and valuable pedigree. We’re very excited about [Banjo-Kazooie:] Nuts & Bolts and some other things we haven’t announced yet. Victor then brought up Bungie, which undertook a high-profile move to independence after being a subsidiary of Microsoft for several years. Said Kim, "We still have a strong working relationship with Bungie - you could even say stronger than it was before. In this industry, independence is a strong motivating factor. The good news for us and for Halo fans is that we’re still working with them. They love Xbox 360, they love Xbox Live, so it’s really not about publishing on other platforms. There are trade-offs on the creative and development side when you go multi-platform." Online: "Richer And More Evergreen" Kim spoke on the financial and community opportunities of downloadable and online platforms, Microsoft's stated focus this generation. "We’re really giving people more content through Xbox Live," he said. "Downloadable content does create a really rich experience to extend the relationship between developer and player. We feel pretty confident that most of [Rock Band's] downloadable revenue is coming from Xbox Live. "I believe that Xbox Live is the most important platform we’re developing," he went on. "As a company, I think we’re in a unique position where we’ll be able to expand on content. It’s really interesting when you look at other developers - Sony is banking on Blu-ray, Nintendo is more on physical play, and we focused our efforts on online play. We want to create unique experiences that are richer and more evergreen, if you will." Kim was sure to note, however, that retail purchases aren't going to be supplanted any time soon. "Digital distribution is nothing new, but I do believe what we can provide is an amazing service," he said. "The success of Xbox Live Arcade really demonstrates our ability to distribute digitally. I don’t personally believe that retail is going to go away. The more interesting way to view this is that this expands the market. People still like a retail shopping experiences. It’s more important for us to build up the experience." Dealing With Developers The exec painted Xbox Live Arcade as an area ripe for experimentation and creativity. "These types of games are hitting a cord with developers who want to work in a smaller studio," he said. "Larger scale games cost a lot, and for some people, they prefer to be one of fifteen people working on a project, especially for creative people. We’re providing a platform, a service, where people will be able to stretch and scratch their different itches to explore the capabilities of Xbox Live. We’re getting less retro, more new ideas, which is really great for the industry." He was unwilling, however, to address when that system would scale up to offering larger, retail-sized games. "That’s a really complicated issue," he admitted. "It’s a little more complicated to download full content. We are developing resources to manage storage, bandwidth, and all that, so it is inevitable, but I’m not sure of when that will be." On dealing with third parties in general, Kim said simply, "Microsoft people are just nice people. There are some important constituencies out there. When we began, we were the new kids on the block, and we needed to work hard to earn trust. We’re fortunate in that some of our competitors don’t recognize the importance of relationships. Our communication becomes a huge advantage during launch and marketing with retailers." The Japanese Market Victor pointed out that Microsoft has famously seen a steep uphill climb in Japanese territories. Kim agreed, citing "cultural differences," but also pointed to a silver lining in development partnerships. "It’s the evolution and maturing of the industry," he said. "While there are classic and beloved Japanese developers, there’s a slide in cultural barriers." "It’s a very big undertaking to develop more content that crosses cultures, he continued. "We’ve all said that we’re not going to win in Japan, but our success is to have Japanese publishers [come to us]." "We just don’t have that install base in Japan, so it’s easier to just focus on the West market," Kim concluded. "Creating hits is hard enough. Personally I think it’s all about your creative energy and the studio’s focus on that particular agenda."

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