Xbox room “went silent” when Sony announced the price for the PS3

It’s likely that E3 2013 is still fresh in your memory. It’s one of the most memorable conferences of this generation, where Sony threw down the gauntlet by undercutting Microsoft on nearly every aspect of the Xbox One, which has just had its own conference hours before. It was the Red Wedding of sorts for this generation, but back in the mid-2000s it was the exact reverse. Sony revealed the price for the PS3 at E3 too – and Microsoft couldn’t believe their luck.

That’s according to former Chief Xbox Officer, Robbie Bach, who sat down with Ryan McCaffery and IGN to discuss the early days of the Xbox 360. If you recall, the original Xbox had a very short life cycle – just over four years – and Bach attributes this to Sony. The Xbox launched after the PS2, and back in 2002 Microsoft knew already that their next console would have to launch first to succeed. Three years later it did, and a full year ahead of Sony.

Bach said this was the first of many surprises the generation would throw up.

“The year later didn’t surprise us, we knew we wanted to be first, we chose this date in 2002. We said its a 5-6 year cycle, earliest they’ll launch is 2005 we have to launch by then. Worst case, we have to be at the same time”,

The real kicker though was the price. Microsoft waited in a sweat while Sony prepared their PS3, eventually watching the E3 livestream from a nearby hotel (they weren’t allowed inside). Bach says that when acting PlayStation CEO Kaz Hirai revealed the price though, they simply couldn’t believe what had been handed to them. Microsoft had been given a free pass into the console business.

“The single moment we knew we had real upside was when they announced the pricing at E3, I mean that was a total shock. We knew the product was too expensive but we thought they’d suck it up. They wouldn’t let us in for the presentation that’s the way E3 works that’s fine, so were watching it on some feed I don’t know what it was and then Kaz said the price. And the room we were in went silent, and we think “Did he really say what I think he said?” and so we started contacting people who were at the Sony stage to get confirmation that the price was actually real, a lot of actually said in our minds “Oh…this could be really fun.” When you have 20% market share and they have 60% you never think you’ve won, but I did say we have a real chance, if we push hard we can make a difference.”

The difference, it turned out, was market domination. For most of the seventh-generation Microsoft owned the console space, with the PS3 struggling to get software out at first, while simultaneously trying to convince gamers to buy their more expensive console. This eventually tipped in their favour in the last two or three years, and helped shape the PS4 into the powerhouse it is today.

In a way, this exact event draws many parallels to the current situation Microsoft now finds themselves in, and it’s part of the reason why Project Scorpio is so interesting to follow. Microsoft on the catch up is capable of amazing things, and with their sights set on the future it presents a compelling narrative for consumers to follow closely.

 

Last Updated: July 27, 2016