GR: Why isn't Microsoft enjoying more success in Japan?
DT: Japanese gamers like local products and local content, and that's different from what launches in the rest of the world. Microsoft has always been pretty light on Japanese specific content, although it has tried very hard to get Japanese developers on board.
But Microsoft launched the original Xbox without many good games. It had the big problem of the disc scratching and the box being overly large for Japanese homes, so the Xbox brand name was crippled to start with. And as it relaunched into that environment it was hard for Microsoft to make any gains.
The brand name got tainted again when Xbox 360 was launched before there were any games ready, and the console didn't sell out. I mean, if Microsoft couldn't sell out of 150,000 consoles, a lot of people who watched that happen would have concluded that it's not worth buying. And a lot of game developers on board for the launch titles might think that it's not worth doing a second game.
Microsoft did a lot of things right - it had a nice redesigned box and a lot of titles in the works - but the big problem was that a lot of the big launch titles slipped, and it didn't slip the launch to go with that. Microsoft should have delayed Xbox 360 until it had better games to go with it.