Kinect and the Hardcore Gamer: Microsoft's David Dennis talks about Kinect, Netflix, and the Future of the Xbox 360

Our intrepid CES correspondent Chris Monfette talked to David Dennis, Microsoft Product Manager, about Kinect's relationship with the hardcore gamer, Netflix, ESPN, the future of the Xbox 360 and a whole lot more. Read the entire interview below to get the whole scoop.

G4: Let’s talk about Kinect and the hardcore gamer. Certainly, you’re expanding the technology into the Xbox interface and announcing things like Avatar Kinect, but when is the hardcore gamer going to see the Kinect go beyond the merely casual?

David Dennis: We think that the core actually came out in droves for Kinect. We don’t think there’s a wall between what the core likes and Kinect. Core gamers love games and some games can be fun and casual and some games can be shooters. At the end of the day, gamers want to have fun. And at the end of the day, Kinect games are very fun, very easy to jump in and play. We certainly saw, at lunch, that the core came out and bought the standalone sensor. That sold out within a week and a half. Obviously, we’re going to continue advancing core franchises that aren’t Kinect enabled and bring more traditional core games to the platform…I think you should expect to see a lot of news from us within the next six months or so as we lead into E3.

G4: Microsoft has talked a lot about Kinect really being the shot-in-the-arm for the system that we’d normally find in a new console launch, an Xbox 720. Have we gone to the fringes as far as the core hardware? Is the future of the consoles peripheral and software based?

David Dennis: Our focus on Kinect was less as a life-extension and more about bringing down barriers to approachability, so that it was easier for more people to use the 360. We want to bring experiences to more people throughout the day, experiences like Netflix and ESPN and Facebook. My wife loves watch Netflix, but she doesn’t know how to turn it on or make it play. So you say, “Xbox, play.” It doesn’t get easier than that. It makes the entire platform easier to engage with, easier to use. Kinect is a great additive product for the 360 that’s already breathed a ton of new life into the Xbox…Usually in year three, year four, you’re at the top of your peak and you’ll start dropping off, but here, with Xbox, we’re in year five and we’re seeing an acceleration in our business. That’s never happened before. What you saw in previous generations is that there were technology reasons to upgrade – adding a DVD, adding 1080p, etc. – but I don’t see anything on the horizon that’s like that. There’s nothing in the Xbox that’s lacking right now to necessitate a console change.

G4: More and more, we’re seeing a trend toward integration. Samsung, for example, wants its new Smart TVs to be able to offer the same exact services that you’re offering through the Xbox. It used to be synergistic. TV needs the Xbox; Xbox needs the TV. But now that Xbox, Sony, Nintendo – as well as mobile providers and TV manufacturers – are offering the same applications, do you see a kind of cannibalism coming?

David Dennis: For us, it’s not about how much content you have; it’s about how good it is and how we can make it uniquely an Xbox experience. We know that our version of Netflix feels like an Xbox experience. The folks at Hulu announced Hulu Plus coming to the Xbox 360 awhile ago – that wasn’t news – but the real news was that they’ve been building it to be fully Kinect enabled with voice and gesture. We’re bringing it to Netflix, to ESPN…The social, connected nature of Live embedded into these experiences is essential for us…We’re just scratching the surface of what we can ultimately do with Kinect, and there’s just so much magic in there for us.

G4: Yes, obviously, there’s a social aspect of the Kinect that you simply can’t deny, and maybe we’re cynics, but if given the choice between my Avatar hanging out in a virtual room with five of my friends, or me physically hanging out in an actual room with five of my friends, I’ll take the physical every time. Are you finding that features like Avatar Kinect are actually being utilized?

David Dennis: It’s one of those viral things, a slow-burn effect where you’re getting that impact, where people are running out to the store to buy a Kinect for video chat. You bought it because you wanted to play Kinect games, but then you stumbled upon these others things. Your friends see it, your neighbors see it…We heard the same cynicism with Netflix where people would say, “Oh, I can watch Netflix on my computer,” but then, woosh, it takes off! So, yes, we believe that people are using those services.

G4: Let’s look at consumer demand for a moment. You give people something impressive, they’re impressed, a moment passes, and then they want more. I love Netflix. I can stream movies instantly to my TV. It’s incredible. But now I hate that I can’t get the same movies online as I can on disc! How do you balance making sure that both your partners and your audience are served by the services you offer?

David Dennis: The more consoles we have out there – the bigger our install base is, the bigger our Live membership is – the more we have partners knocking on our door begging to get in. We’ve been very deliberate and focused on bringing in partners. And it’s not about the quantity of them, but the quality. Sony’s strategy is one of throwing in as much as they can. We’re looking at it from a portfolio management perspective. As we look to bring other partners in, we’re wondering who our customers are asking for, who’s asking us to be on the service, and how do we marry those together in a way that makes sense for everybody? For us, it’s about bringing the entertainment that people want together with the people that care about it. That’s a bit lofty, but it gets to your question.

G4: That seems to be the theme of this year’s show, however, don’t you think? We’ve spoken to GameStop and Sony and Samsung and almost all of them have said the same basic thing: “Bring every piece of content, to every consumer, everywhere.“

David Dennis: The roadmap to get us to our long-term future is like you’re standing on top of the ball and you’re running and you can only see a little bit of the horizon. We’ve laid out a path and a strategy and only pieces of that has been publically rolled out. It’s one thing to have a vision and it’s another thing to execute a strategy. We launched the new console in June; we’ve been killing it on sales. We delivered Halo, Fable, Crackdown, Kinect…We’re more disciplined than we’ve been in the past. We look at the business as hardware/software/Live and how do we invest so that each of those things are working in unison? But we’ve gone from 42 million to 50 million in a span of six months. And that’s mid-lifecycle.



G4: Lastly, where do you see the roll of original IP in the current marketplace. Much like Hollywood, games are now mining the hell out of nostalgia, existing franchises, pre-sold properties, etc. It simply sees too expensive to take a risk these days on a new IP, and yet, at some point, Call of Duty 25 is going get tiresome. How does the industry strike that balance?

David Dennis: You have franchises in movies, but then you look for ways to keep those brands strong like we do in videogames. But we also look to take risks on new things like Kindoms, which we’ve announced with Crytek. You can also look at XBLA as smaller, bite-sized, original gaming experiences – games like Limbo or Shadow Complex. You’re right, we can’t just keep writing the old ones, but there are ways to keep those franchises fresh, and it’s our job to figure out the right combination of investing in new stuff to keep things interesting, but also investing in the blockbusters and making sure that they don’t get tired.

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