Six Questions with Microsoft’s Senior Spokesman, Jose Pinero

29 Apr, 2011 By: Chris Tribbey

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Xbox has come a long, long way since Halo. Today’s Xbox 360 is far different from its games-centric predecessor, both in form and function. Featuring everything from Netflix to ESPN, Microsoft wants Xbox to be the media hub in the living room.

Jose Pinero, senior spokesman for Microsoft’s interactive entertainment business, chatted with Home Media Magazine about where live TV fits into the Xbox 360’s future, how the addition of Kinect might be a game-changer in the console wars and whether a Blu-ray Disc drive will ever be included in the Xbox.

HM: How has Microsoft turned the Xbox 360 into a media hub for everyone beyond gamers?

Pinero: We have been on this journey for the last four years. Over three years ago, we announced Netflix on Xbox Live, and watching movies is a very popular activity on Xbox. We were the first platform to add Netflix. Core gamers, when they’re done playing, watch TV episodes and movies. I just got into “Dexter,” and I love being able to just go through episode after episode. A year later we added the Zune video marketplace, Facebook and Twitter, and then last year we added ESPN, with more than 3,500 live and on-demand sports events per year, out-of-market games and daily highlights.

We are on this path where we are going to add more partners and offer something for everyone. If you want to play games, you can do that. If you want to watch movies, you can go to our video marketplace and watch them instantly in 1080p and 5.1 surround sound. If you want to watch sports, you can go to ESPN on Xbox Live. If you want to watch something new on TV that you missed last night, you can go to Hulu Plus on Xbox Live, a feature we just added. Our aspiration is for people to have Xbox on all day long. A fitness game in the morning, cartoons for the kids after school, Last.fm for teenagers in the evening, dad playing Call of Duty at midnight, a college bowl game on Saturdays. We want Xbox to be the center of home entertainment.

Increasingly, much of the content we encounter is available on multiple platforms. This is why we want to do more with that content and deliver it in ways that you won’t find anywhere else. An example is the addition of Kinect, with voice control and hand gestures, as well as the addition of social experiences, so you can share. The final piece is adding interactivity, like when the game starts on ESPN and you can pick who you think will win the game, see how the rest of the community voted, voice chat with up to seven other friends and answer trivia questions about your team.

We have an installed base of more than 50 million Xbox 360 consoles worldwide, and 30 million of those are connected to Xbox Live. When it comes to changing the way people get their entertainment, Xbox should be in every conversation.

HM: We’ve heard much the past couple years about cord-cutting, with services such as Netflix and Hulu causing more and more people to cancel their cable and satellite subscriptions. What opportunities does Xbox bring to the table in terms of live TV?

Pinero: Our model is based on partnerships. Besides working with aggregators such as Hulu Plus and Netflix, we have a model where we work directly with network operators in the United Kingdom (Sky), France (Canal Plus) and Australia (Foxtel). In the case of Sky we work to bring consumers both on-demand content and live TV.

Sky launched in 2009, and it was the first time live TV was delivered straight through a video game console. Sky is a great example of one way we deliver live and on-demand TV shows, sports and movies, overlaid with a rich interactive experience, which shows your friends online, what shows they’re watching and allows you to group up and watch it with them in a virtual living room environment, with up to eight viewers at a time. In this virtual living room environment, you can use emotes to express your mood or thoughts through your avatar. Viewers can also make recommendations for everyone else to see, and bookmark, like, comment, rate and review films. And there’s a unique opportunity for content producers here, because they can see which videos are at the top, which are being viewed and recommended the most.

Sports events, “American Idol,” the Oscars, shows like that are a natural fit for a group-viewing environment like this. Currently on average 11% of the television audience on Xbox in the United Kingdom watches TV together over Xbox Live. We’ve seen this figure spike to 20% during certain sporting events, and we’re seeing kids use this as a virtual hangout during summer vacation. The Sky experience we have today in the United Kingdom is a great representation of what the future of TV watching can become.

HM: The 360’s motion- and voice-control system Kinect has been a huge success for Microsoft, setting a Guinness World Record as the fastest-selling consumer electronics device ever. What’s the appeal of this add-on?

Pinero: Our intent was to broaden the appeal of Xbox, and we realized that it started as a gaming console, and a lot of the initial users were core gamers.

We also knew that the core gamers of 10 years ago may have families now and may still play Call of Duty with their buddies after 10 p.m., but earlier in the evening, they’re playing Lego Batman with their kids or watching a movie on Netflix. Kinect helps us reach that wider audience and bring them together, particularly for moms who have never touched a controller. For the first time, you don’t have to be a gamer to really enjoy Xbox. You can just stand in front of it and be part of the action. Wave your hand and it recognizes it; speak commands and your Xbox knows what you’re saying.

And the games it enables are for everyone: sports, fitness, family, dancing, yoga, kickboxing. Plus, there’s a growing list of games for the core that will utilize Kinect for a more immersive experience.

HM: Microsoft was on the losing end of the format war, backing HD DVD. What are the chances we’ll ever see a Blu-ray drive on the Xbox 360?

Pinero: HD DVD was designed to be a less expensive, interim technology that transitioned people from DVDs into the world of streaming and interactivity. We fundamentally understand people want to watch movies, they don’t want to wait, and they want to have great picture quality and sound. That’s why we worked on bringing the best streaming technology to our marketplace, with 1080p video and 5.1 surround sound. Our whole focus has been to deliver the best video experience, with no download time, no waiting time. You say “play” and it starts right away. That’s the experience we created with games, and that’s the experience we want to deliver with all content.

HM: What’s next for Xbox Live, in terms of new entertainment partners for Microsoft?

Pinero: This spring we’re launching Hulu Plus, and now we’ve launched Netflix for Kinect, where you can control your Netflix with voice and motion. With Kinect allowing people to control their movie experience, I think that will open up Xbox as a destination for even more premium content. Just like my kids don’t understand the concept of rewinding a cassette, five years from now kids may not understand that there was a time they could not control their movies with their voice.

Today our marketplace for Xbox Live is thriving, where we sell digital goods, like the latest T-shirt design for your avatar, or a light-saber, or other accessories, as well as downloadable games and movies to rent or own. We now have more revenue on the transactional side than the subscription side. Going forward, we see the potential for even more e-commerce revenue.

HM: Where does Microsoft see Xbox 360 fitting in with 3D in the home, both gaming and for other entertainment?

Pinero: There are already some great 3D games for Xbox 360. However, our focus is on Kinect for now. There are still questions about the viability of 3D in the living room, especially with the glasses. Every year I’m at the Consumer Electronics Show, it’s “This is the year of 3D!” And we’re still waiting. A solution with no glasses and a wide viewing angle would probably work for the home. In the meantime the Xbox 360 has the horsepower to handle 3D as that market evolves.

 

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