Chief Microsoft gamer Bach talks Xbox 360

On Tuesday, Microsoft will use its annual Xbox event in Amsterdam to unveil what it is calling its most impressive launch line-up ever, showing ten to 15 new titles for the new version of Xbox, the 360, due to be launched in North America on November 22 and in Europe on December 2.

Robbie Bach, Microsoft’s Mr. Xbox, the president of the company’s entertainment and devices division, sat down with the IDG News Service to explain why he thinks Xbox 360 will steal a march on Sony's upcoming PlayStation 3 (PS3). He also predicted that the new version will not repeat the poor performance of its predecessor in the Japanese market.

IDGNS: How do you react to the Forbes report that the Xbox division has lost US$4 billion?

Bach: We don't disclose the specific numbers at that level of granularity. I'm not quite sure where they came up with the number but I'm not going to contest that we have invested billions of dollars in Xbox, ... It's an investment that has built some amazing assets. We're the number 2 video game company in the world. That's a pretty amazing achievement in less than four years. You just need to look at our portfolio of first party games. How much is a franchise like Halo worth? It's a big investment. Xbox 360 is about turning that asset base that we've created into earnings power.

IDGNS: Any hints on the level of pre-orders?

Bach: So far things on the pre-order front are going very well. ... Our philosophy is to ship initial product and then in the second week ship a little more. Our retailers already know what they’re going to get and that they’re going to get more product the next week.

IDGNS: Why do you think Xbox 360 will be better than PS3?

Bach: First, we have some amazing exclusive franchises. We'll have probably the best launch line-up ever. By the time PS3 ships we'll be working on second generation games. In the end this business is about games and we’re going to have a spectacular line-up. Plus, we have a more powerful platform. We can all debate the merits of their hardware approach and our hardware approach. If you just look at hardware they’re about the same. In some places we’re faster, in other places, they’re faster. The platform isn’t just about that. It includes software design that goes into it and the service design that goes into it. Software developers are finding it incredibly easy to use it to design great games. On the Xbox live we're years ahead. The platform is going to be better, the games are going to be better and the on-line services are going to be better.

IDGNS: Why are you offering two versions of 360 -- with or without a hard drive?

Bach: The question is how do you reach a variety of customers with the right product. If you think about consumer electronics, video game consoles are the only place you don't get a lot of choice. ... There are people who want to spend and have everything under the sun. Others want to be able to play great games. Our logic is to reach those customers with a target offer. It’s particularly important in Europe where parts of Europe are very price sensitive and the channels where games consoles are sold are predominantly mass merchants which again are very price sensitive. ... One size doesn’t fit all.

IDGNS: Some people think the peripherals are quite expensive.