Earlier this month, we brought you an interview with PlayStation India boss Atindriya Bose. Today, IVG caught up with Jaspreet Bindra, Country Manager of Microsoft’s Entertainment and Devices division, which also includes the Xbox 360 business, to tell us about Microsoft’s plans for the rest of 2010. Read on to find out about the new Xbox 360 “shorty”, Kinect, Xbox LIVE, Xbox 360 Classics, post-warranty support, and why he thinks 2010 is the biggest year for Xbox.
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Things have been very quiet at Microsoft for a while. Can we expect that to change any time soon?
Yes, there are two big things to look at. First is our primary market; the core gamers. For them we’ll have the new Xbox 360 console coming in within the next 30 to 60 days. We also have games like Halo: Reach, Fable 3, and Gears of War 3, and all of these games well be launched in India as they launch elsewhere. The second big thing is how to make gaming more mainstream, and the answer to that is Kinect. I was there; I’ve played Kinect, and we’ll be able to give you a demo here in India in a few weeks time. In my and everyone else’s opinion, it’s going to completely change the face of gaming. It will redefine gaming and also make it more entertaining.
Those are the two big things, but thirdly, there will also be a renewed focus on Xbox LIVE. Globally, as you know, LIVE is a big thing. But in India with good broadband finally coming in, LIVE as it exists today will now get more importance, especially with the social networking features like Facebook and Twitter, which are already available for Indian users, and LIVE for Kinect, which will make it an even more social experience.
So we’ve got the new console and new games for the core gamer, Kinect to help make gaming more mainstream, and LIVE ties in with both to make gaming more social. All three of these are our focus areas this year. And everything will happen in India at pretty much the same time that it happens everywhere else.
At E3, Microsoft unveiled the Elite-equivalent console with a 250 GB hard drive and Wi-Fi, and just a couple of days ago, the 4 GB Arcade was announced. Will we have both in India, or just the Arcade one?
We are keen on bringing everything here that the market would want. I think there is enough excitement and there is a constituency for the 250 GB model here, and there is obviously a greater market for the 4 GB console. So while I can’t tell you exactly when each one would be available here, we are keen on bringing each SKU here.
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Can you give us an idea about the pricing for these new consoles?
The prices for these consoles have been announced globally, but here, three things will be added on top of that to increase the price. Two of these we can predict; the third we can’t. One is duties, which is 27-28 percent; second is the retailer and distributor margin, which gets added abroad as well; third and most important is the Rupee-Dollar exchange rate at that time. But looking at how the newer consoles have been introduced at the same price in the West, they should be at the same price as it is now here as well.
But we only briefly had the Elite console in India for Rs 35,000. That isn’t really an accurate price indication for the current 250 GB model.
We don’t bring in consoles because we want to; we do it because there is demand. We had brought in the Elites back then because there was a very small market for it, but it just didn’t justify the price. Now, the 250 GB console with its great features is very competitive and there is a sizeable market for it.
The similar SKU from Sony is the 250 GB PS3, which sells for around Rs 22,500. Can we expect the 250 GB Xbox 360 to be priced around that?
Yes, possibly. One thing Sony wants to know, perhaps even more badly than you do, is how much I will price the console in India. I don’t want to tell them (laughs). This is a competitive situation, and it will be competitively priced. We do special India pricing for a lot of our games, so we will definitely be competitive with the console as well. Also, with LIVE and Kinect coming in, I also have stuff that I don’t have competition in, so I’m not going to look for competitive pricing there. Instead, I’ll look at what the consumer will be willing to pay.
The target audience for Kinect is the entry-level user. This user is also more price-conscious. So considering the $150 price in the US, what can we expect it to cost in India?
I am not announcing the price for Kinect at this point. The Kinect launch is going to happen in the last two months of this year. So we have some time, and again for competitive reasons, I would rather announce the price closer to the Indian launch. Having said that, this is a product that transcends pricing. Once you see how it is, what it does, and how magical it is, the pricing is really not going to be a factor.
Next page: Kinect marketing, release date
So much about Kinect lies in the experience. You can’t quite tell how good or bad it is by watching someone else play. So around launch will there be opportunities for the general public to try Kinect out and let them experience it first hand?
Yes, Kinect is an experience-based buying decision. In fact, it’s so experience-based that if you play it once, you’ll want to go buy it. We’ll be doing three things. One is we will have people like yourself come and try it out, write about it, and go out and tell people about it. Secondly, we took a decision a while back that all our marketing will either be in retail or online. So at retail, we’ll have a huge number of demos happening all over. Third is online. Everyone who has or wants to buy an Xbox or Kinect is online, so that’s the best medium for us to target those users; may be through social networking. So these are the three ways in which we want to spread the word on Kinect. Do not expect to see large television advertising.
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So no more of that?
Well, when I came into the business about two years ago, we did a fairly large consumer study of gamers and would-be gamers, and we found that Xbox is an iconic brand. It has an extremely high recall value of 67%, and 66% had an intention to buy an Xbox 360. So with this, above-the-line advertising is a waste of money. There was some great advertising at launch and that did its job. The job now is what I just mentioned; we’re focussing our energies in the retail and online channels.
Will we have Kinect here in November when it launches everywhere else, or will there be a delay?
We will launch it at pretty much the same time. But sometimes there are shipping delays, and other logistical issues; or may be we might decide to bring it around a festival season. So there could be some delay, but it should be more or less simultaneous.
Will there be a console-Kinect bundle here?
There are many different options, and it’s for us to choose which ones we bring here. If it makes sense for India, we’ll bring it here.
Coming to the games; at launch and for a long time after that as well, there was fixed pricing for first-party games, but these days the price keeps fluctuating from game to game and very often a price is announced and then a day or two before release, the price is changed. What’s the reason for these price fluctuations?
There is a reason for that. We have control over first-party pricing. We can gauge market demand and the potential for a particular game, and price it accordingly, so we can have special pricing for our games.
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A long time ago, the Classic/Platinum range of games was introduced in India, but that catalogue hasn’t been updated in a long time. Why is that?
Well, there’s two angles to that. Yes, there is a growing list of Platinum titles, both in terms of first and third party games. Whether third party Platinum games come here is not in our hands. Coming to the first party titles, we are now consciously growing our games library from a Kinect launch angle and the new Xbox launch angle, so you will now start to see much more game-related activity happening. This is the biggest year for Xbox.
Microsoft has provided exemplary support since day one where the Xbox 360 is concerned. But it’s been over three years since launch, and those who bought the console at launch have run out of warranty. So is there any sort of support plan for these consoles?
We are trying to bring in some sort of AMC (annual maintenance contract), which will give you extended warranty. I think very soon we will have that out in the market, and we’ll be able to tell you more about it once we do. Meanwhile, we’ll be very happy if you buy the new Xbox (laughs).
What does the current Xbox 360 install base in India stand at?
You know, I was going to ask you. The problem is I can only estimate based on how much I sell. With the duty structure that we have, there are far more Xbox’s that come in through the grey channels. There are some third-party estimates from NASSCOM, FICCI, etc who say that there are 1 lakh to 3 lakh Xbox 360s in India. The exact figure is anyone’s guess.
So what’s your best estimate then?
I would say it’s certainly more than 1 lakh.
Next page: Piracy, Xbox LIVE, Indian games
How badly is game piracy affecting the Xbox 360 in India?
Piracy is a big issue for our software business, and it’s an equally big issue for our gaming business. The way the gaming business works, companies do not make money from consoles. The margins are made in software. So it’s very important for us that people buy games. If they don’t, then just selling consoles turns this into a charity business. So piracy is really, really hurting us. But the positive thing is that year after year piracy is going down.
So then do you see digital distribution via Xbox LIVE as a viable option for a country like India?
Yes, definitely. Bandwidth has been an issue, and it still is an issue. But the broadband situation is now improving, and higher bandwidth connectivity is getting cheaper. So I think the shift to downloads will happen, but gradually.
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One very worrying trend of late is that some third party distributors don’t bring in the Xbox 360 version of certain games; they’ll only bring in the PS3 version. Even Activision games for Xbox 360 no longer release in India. What do you make of this and is there something you can do to make sure that Xbox 360 owners get these games too?
I agree that this is a serious problem. Things would be a lot easier if the publishers themselves had some sort of presence in India. But we have to work with the distributors and try to find a solution for this. You happened to mention Activision; they’re actually making some of the best Kinect games, and with that happening, some of these issues will get sorted. But we do need to look at this more closely. I did have a chat with some of our partners at E3, and there’s more work to be done, but it’s certainly something that needs to be taken care of.
Can you tell us a bit about the Xbox LIVE user base in India?
I cannot share the exact numbers with you, but as a percentage of overall users, we have a very healthy percentage compared to other countries around the world. But if you ask me, we haven’t even scratched the surface. Personally, I’ve been very impatient in wanting to push LIVE, but we’ve been holding back due to the lack of broadband, etc. But I think starting this year and probably next year is when we’ll really start to see a lot of activity on Xbox LIVE.
What’s the Gold-Silver ratio like? Is there a good number of Gold subscribers here?
All I can say is yes, it’s a good number, but I can’t get into specifics. However, there have been issues; one in particular which has been concerning us. The credit card authentication that was brought in by the government has prevented people from buying subscriptions and points online. People can still buy prepaid cards at retail or via our website, but it’s still not the ideal situation, and we will rectify this situation. It will just take some time.
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There are a lot of Indian studios that are getting into game development, be it arcade titles or PSP games. Has Microsoft been in touch with any Indian developers to create games, maybe for the Xbox LIVE Arcade platform?
In terms of boxed Xbox games, yes there are games like Forza; GameShastra has done a lot of work on those games. Development happens all over the world and India is no different. In terms of creating a console game for India, the answer is no. If we create a game, it has to be high quality. Most people in India still prefer to play global titles. For Xbox LIVE Arcade, the answer is yes and no. It hasn’t been happening yet, but we have been talking to a few people who are interested in the platform, and hopefully it will happen very soon.
Anything else you’d like to say to the readers?
I’d like to clarify that there was never any lack of activity on the Xbox front. Xbox came into the Indian market with such a dhamaka that we’ve set the bar high for ourselves, and because we haven’t always maintained that high level of activity, it may have seemed like there is no activity around Xbox at all. But that really isn’t the case. We’ve been growing year-on-year. We sold more Xboxes last year than we did the year before that. We always knew that something big like what we have this year was around the corner, so we’ve been preparing for that. This is going to be a great year. In so many ways, we’re starting from scratch and redefining everything. It’s going to be very exciting.