On Delivering Value

Jun 24, 2013

Microsoft’s Don Mattick reacted to a question posed to him at the one interview Microsoft didn’t cancel 2 weeks ago at E3. This is a perfect example of what I meant last week on Episode 89 when I said Microsoft had its head up its ass. When asked by Bloomberg TV what it will mean to Xbox One that the PS4 is $100 less, he said something he should be regretting right now and I want every gamer to hear it. His reaction was to say Microsoft is “over delivering value” against other choices consumers have. When asked for an example, he reacted with this:

“Well, just any modern product these days, you look at it, $499 isn’t a ridiculous price point. We’re delivering thousands of dollars of value to people so I think they’re gonna love it when they use it.”

There are several operative words here that must be called out:

First: Mattick said “any modern product these days.” What he is clearly referring to are devices NOT the PS4. Such as an iPad which is $499, a Surface Tablet or Galaxy tab which are also in that ballpark. He is Microsoft’s president of interactive entertainment. He’s not some schmuck who isn’t prepared to answer questions. And this is the response he was prepared to give? Kudos for Microsoft for thinking outside of the gaming world, but this is E3! It’s the biggest stage of the year for video gamers and you have to win the media battles. You don’t insult people by comparing your product to anything other than a gaming system such as the PS4 or AT LEAST compare it to how much more value it provides over the 360.

Second: He said they’re “delivering thousands of dollars of value.” No they are not. Let me make that clear: the Xbox One at $499 does not deliver thousands of dollars of value. If it did, it would cost thousands of dollars. In other words, as a consumer if I spend thousands of dollars in games and services for my Xbox One, then it will deliver that much value. It’s capable. Well guess what, I’m capable by running a marathon but I freaking can’t unless I spend considerable time and energy training for it!

Here’s the deal folks, from a gamers perspective, Microsoft has gone rogue. They want you to buy an Xbox One so they can plug you into their ecosystem. They have bigger plans including a major restructure of the Windows business that I guarantee you will affect the Xbox in the next 3-5 years. At the end of the day, it’s all about games games games for people like us: gamers. Sure, they may have a play for a wider audience that wants to yell at their TV because they’re too lazy to press numbers on a controller. Big whoop. Those aren’t gamers and publishers, developers, GameStop and Steam only get paid if games are being consumed. That’s why you should truly consider Nintendo and Sony for your gaming pleasures.

If Microsoft continues to look outside of gaming for their Xbox product, they will seriously alienate all of us including the smart guys that make these games we all love. And frankly, if I were a developer I wouldn’t want to spend the money/time developing for a system that touts NFL TV and Fantasy Sports inclusion. Those owners are less likely to be playing my game than those who own the PS4 or Wii U. At the end of the day, it’s all about games.