Robbie Bach: E3 2004 Press Briefing

Remarks by Robbie Bach, Senior Vice President, Games Division
Chief Xbox Officer (CXO), Microsoft Corporation
J Allard, Corporate Vice President and Chief XNA Architect, Microsoft Corporation
Peter Moore, Corporate Vice President, Worldwide Retail Sales and Marketing, Home and Entertainment Division, Microsoft Corporation
E3 Press Briefing
Shrine Theater
Los Angeles, California
May 10, 2004

ANNOUNCER: Ladies and gentlemen, please welcome J Allard. (Applause.)

J ALLARD: Good evening, everyone, and welcome to Los Angeles. Tonight kicks off what’s sure to be an exciting week for us all. My name is J Allard and I’m the head of the Xbox Platform Group. I’m thrilled to be the first to welcome all of you to E3.

What you’ve just seen are some previews of the great new Xbox games that are going to be out this year: Unreal Championship 2, Shrek 2, Full Spectrum Warrior, Mech Assault 2, Conquer, Fable and, of course, Republic Commando. It is absolutely amazing and stunning to me how developers keep getting more and more out of the innovative Xbox platform to deliver those kinds of experiences. And that’s why we’re continually putting more and more into the platform itself.

Tonight we’re going to show you how we’re leading in software and in services. We’re going to show you how we’re leading in the innovation of new games. And we’ll show you tonight how we’re working with some of the best partners in the industry to drive some explosive growth.

Through innovation and leadership we are changing the game to uniquely position Xbox and all of our partners in this industry to lead for the months and years to come.

Everything we do begins with software. Software is the key to unlocking the potential, the real potential of this industry. It’s the catalyst for growth, the enabler of innovation, and in many ways software is what brings many of us into the room tonight.

We built and designed Xbox to run great software and we’ll build its successor to run great software as well. Developers want to create great breakthrough game experiences so we’re arming them with the software that’s going to get the most use out of today’s hardware as well as tomorrow’s.

A lot of people ask how we went about creating the greatest online gaming service, and the answer is very simple. We went out and we listened to gamers and then we used the magic of software to deliver exactly what they were dreaming of.

And you know, we at Xbox never back away from a challenge. In fact, a few weeks ago in New York City, Xbox Live was put to the ultimate test. Thankfully, our camera crew was there to capture that assignment in living color.

(Video segment.)

(Cheers, applause.)

J ALLARD: Now, talk about the ultimate first person shooter, Donald Trump.

In addition to our budding reality TV careers, we’ve seriously been successful in selling more than 14 million connected consoles and have nearly 1 million Live subscribers. Live is in 24 countries now, and this holiday by year-end, more than 150 games are going to be Live enabled in the Xbox portfolio.

But there’s so much more to this story than just numbers. The real story with Live is how we’re using software to continually innovate. Since Live debuted we’ve rolled out three major waves of enhancements to the service, and we’re continually adding new features that change the way the gamers connect and the way that developers create games.

So today, whether gamers are battling it out online and trash talking, organizing tournaments, downloading and swapping content or just hanging out and keeping in touch, there’s always something to do on Xbox Live.

Now, a bunch of these new features premiered three weeks ago and gamers absolutely love them. So let’s check them out.

What I’m bringing up here is the Xbox dashboard. This is what we call Live Now. It’s a gamer’s quick view to show you what’s going on online, what’s new on the service. You can see we’ve got some friends online, it’s got an invitation, and it also talks about what’s going on with the service this week. It’s a great place to hang out and chat with your friends.

Now, what we’re going to do now is we’re going to go out and see what my friends are up to. We’re going to go out, query the service, all the people that I’ve played with in all of the games, and it will tell me who’s online and what they’re up to.

So here you see my buddy Siren, and she’s off there, she’s playing Rally Sport Challenge 2. And we’ve got Nighter, an annoying guy, but Jenny and the Rock have both sent friends invites and then my buddy Andre, who’s always hanging out playing Trivial Pursuit. He’s got issues.

But it’s Jenny that I want to talk about. Let’s go see who this Jenny character is.

One of the new features we just added is voicemail, which will help me understand who this person is that’s wanting to be my friend.

JENNY VOICEMAIL: Hey, J, Jenny McCarthy here. I had such a great time at your place last night.

J ALLARD: That Jen.

JENNY VOICEMAIL: Hey, let’s play on Live later. Thank you again. Because you know it’s good to play together.

JENNY MCCARTHY: Yes, Jenny, it is. So I think I’ll accept this friend’s invite and we’ll take that up a little bit later.

Now, with voicemail Xbox Live gamers get to stay in touch with one another, even when they’re not online playing. And when they’re sending friends invites like that, you get some context to know exactly who’s making the invitation.

This new feature in just three weeks had already been rolled out to over 450,000 Live members that have upgraded and are participating with the voicemail system. It’s a great, great new feature. It demonstrates our commitment to continual innovation and it shows how we can evolve the platform so quickly.

But it’s really just the tip of the iceberg. I mean, as we move into the future, the next logical step when you have a friend like Jenny McCarthy is to see her.

Oh, you guys don’t want to see me. Hey, Jenny, what’s shaking, baby?

JENNY MCCARTHY: Hey, J, what’s up? I just lathered up Enzo and I am ready for some PGR 2, baby.

J ALLARD: Uh, Jenny, I’ve got a few people over right now so we might not want to do that. Why don’t you give my buddies a wave and we’ll talk a little bit about some of the features of the service?

So this is a new idea that we’ve gotten in development in Japan but we’ll be rolling out to new gamers. And aside from seeing and saying hi to Jenny I can tell Jenny that she’s super cool and send her a little bit of music. And I can get interrupted by my friend Peter.

PETER MOORE: Hey, Jenny, hey, J, how’s it going?


J ALLARD: Peter, what you doing back there?

PETER MOORE: We’ve got a big announcement to make tonight, so I’ll explain everything when I come downstairs later on.

J ALLARD: All right. Guys, I’ve got a show to finish up here so you guys will just have to finish up this conversation later.

PETER MOORE: See you later.

JENNY MCCARTHY: What the heck’s going on?

PETER MOORE: Oh, don’t worry about it, Jenny, we’re in good shape here.

JENNY MCCARTHY: Peter, you call those guns?

PETER MOORE: Yeah, these are guns, baby. I’ll show you later.

J ALLARD: All right, Peter, I’m going to see you on stage. Jenny, I want to see you backstage, all right?


J ALLARD: Thanks, guys.

PETER MOORE: Bye. Take it easy.


J ALLARD: Now, there’s so much we could cover in that demo, because of all the features that we’ve incorporated. I just want to touch on a couple of the high points.

Basically, you could find up to five of your friends online and they could find you and join those group chats. It’s not just a great way to stay in touch, but you also have great features like being able to share cool music, send each other little tickles and all sorts of other stuff when you chat.

Now, as this service evolves you’ll be able to send video-mail, just like the voicemail demo that we did before, and integrate integrated video chat in all of your gaming experiences.

We believe that video communications is the next step in our broad reaching Xbox multimedia strategy. It’s going to help us expand the audience, it’s going to integrate media with games and ultimately it’s going to revolutionize social entertainment.

Now, how else are we going to broaden the audience with Xbox Live? Well, tonight I’m happy to announce that, starting this fall, a great lineup of casual games that people love are going to begin to roll out and be available on demand on the Xbox Live service. It’s a new feature called the Xbox Live Arcade and it will allow live gamers to download their favorites, games like Galaxian, Dig Dug, Poker, Bejeweled and Feeding Frenzy. That’s right, classic card games, puzzle games, trivia games, retro arcade games and action games are all coming to Xbox Live this fall. And they’re coming from well-known partners, partners like Atari, Namco, PopCap, Garage Games and Wild Tangent, just to name a few.

Let’s go visit the arcade.

(Video segment.)

(Cheers, applause.)

J ALLARD: This fall the Arcade opens for business. These games are easy to get into, they’re a total blast and it makes it perfect for the gamer who doesn’t have a lot of time and just needs a quick fix.

It’s only through software that we can continually innovate and add all these new features to the Xbox platform, features like voice messaging, matchmaking, live alerts, live Web, the Xbox Live Arcade and later this year video chat. That’s the kind of leadership that’s going to make the competition even smaller in our rear view mirror.

Now, we’ve talked a lot and it’s about the power of software and I think it’s pretty evident in the current generation of console gaming. But what about tomorrow when all the rules change? Again, the answer is going to be software.

Remember these three letters: XNA. Through XNA, which we announced a few weeks ago at the Game Developers Conference, we’re collaborating with the world’s best development partners in the industry, and together we’re creating a software development platform that spans Windows and Xbox.

With developers, XNA provides a great software platform and tools that allow them to make great games at a development cost that makes sense.

Now, for gamers all they need to know about XNA is that they’re going to be floored with incredible next generation graphics, next generation sound, next generation Live play, and the best part is it’s going to play on next generation devices.

Now, every time I talk people ask me why I don’t say a little bit more about hardware. It’s always software, software, software, software. So tonight you guys win. Let’s talk about hardware. Tonight I want to introduce the Saleen S7. Now, this is a serious piece of hardware. Weighing in at 2,700 pounds, 550 horses, this monster can tear it up in under four seconds and hit 60 miles an hour, with a top end of over 200.

Now, the problem with hardware is it’s a little complicated and it’s very expensive and not a lot of people really have the opportunity to fully test out what it’s capable of. So we turned to software and we turned to our friends at Pseudo Interactive and enlisted their help to show what the Saleen could really do.

Six weeks ago in a demo called Crash, we showed the world what it would look like if you ran one of those babies into a wall at 200 plus miles an hour.

Now, because the team was using these mature XNA tools, they were able to really focus on the magic. They did extensive lighting, extensive modeling, great dynamic lights and the result was absolutely stunning, great feedback.

It was so good, in fact, that two things happened after the GDC conference. The first thing was people asked for an encore. They wanted to show it again at E3. And second, David’s phone at Pseudo just started ringing off the hook because all sorts of people wanted to know how they could get together with David’s team and enlist them on a game project or enlist their technology and bring their physics into a game.

So just in case you missed it, I wanted to have an encore presentation of Crash. Here it is.

(Video segment.)

(Cheers, applause.)

J ALLARD: Now, that demo is an impressive first look at what developers can do with XNA, but it gets better because not only is XNA good, it’s fast. In the last six weeks since GDC, Pseudo was able to take Crash to the next level and the difference is dramatic.

So what I want to show you tonight is what we call Crash Reloaded and I want you to remember that just six weeks separate these two different demos.

(Video segment.)

J ALLARD: Now so far it doesn’t look that different. You might think, well, gee, David, the best you could do is make the car green? But really what David and the team did was they added the green car. Let’s see what happens. The only thing that’s better than driving a Saleen S7 into a wall at 200 miles an hour is to drive two of them into each other.

(Video segment.)

J ALLARD: Let’s do it again with meaning, with feeling this time.

(Video segment.)

(Cheers, applause.)

J ALLARD: That’s a great demo. It’s pretty amazing and a great sign of the things to come as XNA allows developers to really focus more on the magic of their game and not screw around with the baseline tech or wrestle with the hardware.

The whole point is to allow creators to move from storyboard to prototype to breakthrough games and in just such short period of time Pseudo added the second car, the inter-car physics and made the crash take it to the next level and the phones continue to ring. So David’s been having the conversations with the publishers and a lot of people are very excited about taking this demo into a full-blown game.

Congratulations, David. You guys have really broken the wall between us and the future with XNA. (Applause.)

Now, XNA is preparing developers for the next generation of graphics when high-definition gaming really resets the rules. But what about online games? Well, also at GDC we announced that Brad McQuaid, the original producer and co-creator of the EverQuest universe, has teamed up with Microsoft on his next epic title. Everybody knows EverQuest. It’s the best-selling MMP in North America. Well, Brad and his team at Sigil Games Online are at it again and this time they’re readying a third generation MMO RPG that’s going to be available exclusively on XNA platform.

Sigil started with the latest unreal engine and has modified it to support a hugely seamless world in a client-server environment. Vanguard is also incorporating early XNA software from all of our teams to really bring this game to life. And because it’s an XNA title, Windows players are going to be able to use an Xbox controller on their PC to play the game or they could stick with the traditional keyboard and mouse and it will have an adaptive UI based on what the user experience is.

Vanguard is also going to be one of those games that uses the Windows version of the Xbox Live service to get ready for the next generation of online game play on Windows, and that means every player in the universe is going to be able to communicate using voice. It means that every player in the universe is going to be able to plug into that world using mobile devices. It means that every player can stay connected to the action and to the Vanguard universe any time, any place and on any device. So I cannot wait to play this game.

Software is really what makes us the innovation leader in this generation and we believe that software is going to be what is going to help us become the market leader in future generations.

This benefits everybody in gaming, not just Xbox. By freeing the developers to focus on what they do best, making kick-ass games, they win, publishers win, retailers win, we win, but most importantly, the gamer wins.

Xbox is changing the game and we’ve got the mettle to prove it. You just saw it. And in this exciting preview of what’s coming this year you’re going to see it again. So strap in and hang on.

(Video segment.)

ANNOUNCER: Ladies and gentlemen, please welcome Peter Moore.

(Cheers, applause.)

PETER MOORE: Good evening. I’m Peter Moore, and I’m responsible for delivering a portfolio of great games, supported by world-class marketing. What you’ve just seen is but a sample of our incredible lineup, and you’re about to see even more phenomenal games that will undoubtedly redefine their respective genres.

These amazing games will reflect the boundless imagination of their creators. They promise to immerse gamers in a deep, compelling storyline and they give gamers unprecedented freedom to personalize their gaming experiences.

The goal isn’t just to please gamers; the goal is to absolutely blow them away.

Now, before I go any further, I know there’s one game on everybody’s mind right now. Yes, sir. So let’s end all of the suspense. Let’s talk about —


PETER MOORE: — Halo 2. It’s the sequel to one of the greatest games ever made and the most anticipated game on any platform.

As you may remember, we showed you single-player demo at this event last year. Well, tonight, Bungie is here to give us our first glimpse of Halo 2’s multiplayer action. (Cheers, applause.)

This is definitely changing the game and you’re going to absolutely love it. To take you through the demo, please help me welcome Bungie’s very own Joe Staten and Max Hogan. (Cheers, applause.)

JOE STATEN: The year is 2552. After a long fight, our colonial defense has failed and the Covenant has made their way to earth. Today’s mission takes place 20 klicks north of the Covenant’s primary point of incursion in an abandoned township on the cost of East Africa.

(Video segment.)

JOE STATEN: The handful of Marines who survived the Covenant assault called this place Hell on Earth. We call it Zanzibar.

(Video segment.)

JOE STATEN: Now, the story might have been different if we had more of these on the ground, Spartan Cybernetic soldiers equipped with Mark XI Saddle Armor. Each suit is highly customizable, from color schemes to emblems. Spartans are free to prep their armor as they see fit.

But like I said, when the Covenant hit, they hit hard. Low-level infantry, backed up by plenty of these, Elites, the iron heart of the Covenant military. A single Elite can decimate a squad of Marines. It remains to be seen how an equal number of Spartans will fare.

So since we’re actually going to be playing Zanzibar at the show, I thought I’d give you a brief tutorial about the latest battlefield tactics and technology. This is an actually network game. I’m a Spartan and Max, our multiplayer lead, is an Elite.

Hey, say hi, Max. You know, some things just go across cultures. Max is carrying our most brutal close-range weapon, the Covenant Energy Sword. If you see an opponent with one of these, you’d better take him down quick. And one of the best ways to do that is do a Wielding. Just walk over a weapon you want to do a Wield and press Y. (Cheers, applause.)

The right trigger fires my SMG and the left fires my Needler, which actually in Halo 2 is worth picking up. Bam! (Cheers, applause.) I’ll just save this for later.

We’ve reworked all our vehicles in Halo 2 like this Ghost, for example. It’s all pimped out with the ground effects. But, hey, the coolest feature is under the hood. Now, that’s called boosting; just hold down the left trigger. It quickly doubles your speed and it’s a great way to get out of a bad situation or just mow down an enemy.

But be careful; if you let an enemy get too close, oh, take it! To board a vehicle, just approach a stopped or slowly moving one. From the back or front press X. This is so fun we do this all day. (Laughter.) Here, Max, I’ll make it easy for you. Ow.

All the vehicles in Halo 2 are destructible. So watch as I go to work with a Battle Rifle, which so you know un-zoom fires three-shot bursts and zoomed it fires single shots.

Yeah, you’ve got to watch out for the secondary explosion. Max is a professional. Ooh, sorry about that, Max.

The Warthog has gotten an upgrade, too, and it’s also destructible. A hubcap. And this Warthog has a rocket launcher. With unlimited ammo, of course.

So let’s even the odds. Let’s pick this up. In Halo 2 vehicle damage isn’t just cosmetic. The more messed up your vehicle is the harder it is to drive. Yeah, I hear you.

Our Infantry Rocket Launcher has a deadly new feature. It’s called target tracking. Just zoom in, paint the target with your reticule — whoa — and let one fly. I think I killed Max so we’re going to try that again.

Come on, Warthog. Here, Max, how about this one? Again, we go this all day. All right, target tracking, here we go. Zoom in, get a good lock, give me your best shot.

All right, now bring it, you alien bastards!

And wouldn’t you know it, I’m out of rockets for the most important thing. I promised Robbie we wouldn’t just blow up Warthogs but take it! There we go. You like that?

But be careful. People usually get pretty pissed when you bust up their ride. Luckily, I’ve got the ultimate anti-son-of-a-bitch stick right here. The Melee Attack by pressing B or line up your target for a powerful Lunge Attack. Wow, a really powerful Lunge Attack.

The game will be playing at the show in single flag CTM. Spartan, this is a hard insertion, tactical drop. Go up and over the seawall or jump in a vehicle and head for the gap. Elite, you have strong point. It’s primitive, human, but defend it at all costs.

This power substation has lots of entrances and some of them are more defensible than others. Elite, if you let the Spartans into your base and they open the main gate, there will be nothing from stopping them from driving their vehicles directly into your base.

If the Spartans manage to capture your flag, stop them any way you can.

But keep your eyes peeled. Like our vehicles, Zanzibar has weak points. A good midfield defense is key. Elites, snipe the Spartans on their way in but watch out for counter-sniping. Every great battlefield has history, secrets and Zanzibar is no exception.

(Cheers, applause.)

The entire team is busting ass right now to finish Halo and make it great. We’re really excited to get it into your guys’ hands. And the good news is we’re pretty damn close.

Thanks, Peter. (Applause.)

PETER MOORE: Thank you, Joe. Thank you, Max. Super job, absolutely phenomenal. (Applause.)

We believe collaboration equals leadership and Halo 2 bears that out. What an amazing achievement from Bungie’s team and what a great addition to Xbox Live.

The best part about Halo 2 is tonight we finally have a street date. (Cheers, applause.)

AUDIENCE: I love you, Pete!

PETER MOORE: I love you, too, man! It’s in stone. Well, actually that’s not the only place it’s in. You know, Jenny was checking out my guns earlier on when we were on video chat there and I really didn’t want to go into it because, well, it’s kind of a surprise. But now I can tell you. So I go out with the sales guys last Saturday night, you know how these things go and after a few drinks — well, after a number of drinks I dropped the bomb on them, said, “Guys, we’ve got a release date on Halo 2 and we weren’t backing out.” They said they’d believe that the day I tattooed that on my arm; skeptical bunch.

Well, fellas, I got your release date right here. (Cheers, applause.) November the 9th, the moment Xbox nation has been waiting for, Halo 2. And yes, that is 2004. (Laughter.)

The launch of Halo 2 will also mark one of the biggest videogame launches in history. We’ll be supporting this launch with a massive marketing campaign that will include global print and a huge television advertising campaign. We want to make an incredible amount of noise. We want the launch to be as big as the game and this will definitely create a buzz of epic proportion.

But the news tonight doesn’t end with Halo 2. We have several more incredible titles that showcase what Xbox games are all about. Let’s start with a partner that consistently delivers hit after hit, and that’s Tecmo. In March, Tecmo captured the number one spot across all consoles when it released Ninja Gaidin. (Cheers, applause.)

Now, another power-packed Tecmo release, DOA Ultimate, is like a dream come true for Xbox fans who crave the entire DOA series on their Xbox. Itagaki san, the creator of the DOA series, consistently redefines what amazing graphics mean.

Dead or Alive Ultimate is the first 3D fighting game to go online. Yes, online. Talk about changing the game. Your favorite Dead or Alive games completely built from the ground up for Xbox and on Xbox Live.

(Video segment.)

(Cheers, applause.)

PETER MOORE: Elephants and giraffes in a DOA game, who’d a thunk it?

Now, remember that is head-to-head online game play.

Doom 3 is on the way as a console exclusive for Xbox, and the team at Id Software has outdone themselves with the most frightening and gripping 3D gaming experience ever created. A massive, demonic invasion has overwhelmed the Union Aerospace Corporation’s mars research facility. As one of the only few survivors, you fend off shock and fear as you fight your way to hell and back in epic clash against pure evil — evil so terrifying that you may not want to play alone. And luckily you don’t have to, because this game has co-op play on Xbox Live. Bring on the pain! (Cheers, applause.)

(Video segment.)


PETER MOORE: I can’t wait to play that with the lights on.

Also due out this coming year is Jade Empire. This stunning game is from BioWare, the critically acclaimed developer of Star Wars: Knights of the Old Republic, NeverWinter Knights and Baldur’s Gate. Jade Empire takes the excitement and adrenaline rush of an intense fighting game and couples it with a fascinating storyline and plot, which has become BioWare’s trademark. Only by mastering the greatest fighting system and defeating the most powerful enemies will players earn their place as a master of martial arts in the world of Jade Empire.

(Video segment.)

(Cheers, applause.)

PETER MOORE: Now, if it’s not already abundantly clear, the Xbox pipeline is loaded with great games: Fable, Star Wars Republic Commando, Mech Assault 2, Full Spectrum Warrior, Conquer, Far Cry, Chronicles of Riddick, Unreal Championship 2, Spiderman 2, Harry Potter and the Prisoner of Azkaban; the list goes on and on.

This is the most impressive lineup for Xbox ever, and there’s one more. We’ve already created a legion of fanatics with the hugely popular street racer Project Gotham Racing, which has sold over 2.5 million copies worldwide. Tonight I am pleased to tell you that Xbox is earning a one-two punch that supercharges the racing category. And the fender banging and ground pounding can only be found on Xbox.

I’m proud to announce the world premier of Forza MotorSports, the fully customizable racing simulating for Xbox.

(Video segment.)

(Cheers, applause.)

PETER MOORE: We’ve built this extraordinary game with the help of top engineers from Ferrari’s Formula One program. We wanted that level of racing realism. That’s why we also designed the performance of the cars to be adversely affected by the damage, just as in real racing. Forza MotorSports sets itself apart with an unprecedented level of personalization, customization and turning. This is indeed the ultimate racing experience.

I’m truly excited about the games I’ve shared with you tonight. Taken as a whole, they give you compelling evidence that we’re not making claims we can’t back up. When we say we’re changing the game, we’re really changing the game. What you’ve seen are brilliant new games that give gamers what they want, explosive action, drop dead realism, gripping drama, richly evolving characters and personalization on a level never imagined.

Xbox and our amazing partners are writing the next chapter in the book of gaming superiority. Together we’re fueling a whole new gaming experience, one that will allow us to continue to build upon our position of thought leadership within this industry.

And so to pump a little more nitro into the Xbox engine, here’s the man behind the wheel, Robbie Bach.

(Cheers, applause.)

ROBBIE BACH: Now, I rode over here with J Allard, and if you’re ridden with J in LA traffic you know what force is like. So I’m most excited and just a bit terrified of that game.

Now, E3 is an annual milestone for all of us in the industry, and at Xbox this is our fourth year at E3. And with each year, we’ve advanced our position in the industry. During our first year, we were just ramping up to enter the videogame console business. We were brand new to the industry and people understandably questioned our ability to succeed. The jury was out.

With Xbox launched, we spent the next two years focused on becoming a credible partner in the industry. We said we’d build a great installed base and we did with more than 14 million consoles sold. We said we’d innovate online and we did with the industry-leading Xbox Live service. We said we’d offer great games from a variety of strong publishers, and we have. In fact, our attach rate is an industry record. We are now part of the landscape, a recognized player in the industry.

So this year, our fourth year, I know it’s time to change the game. We’ve proven we can play; now we’re proving we can lead.

And our leadership plan starts with delivering breakthrough games for the platform, ambitious titles that capture the imagination of gamers, titles that fly off the store shelves, titles with the courage to ignore the old rules. We’re focusing on delivering titles on an epic scale like Halo 2. We’re going to deliver unprecedented customization with breakthrough games like Forza Motorsport. Fable will demonstrate leadership in designing games with incredible, evolving characters and storylines. And titles like Doom 3 are going to reinforce what everybody knows, the best looking games, the best playing games and the best online games are on Xbox.

If great games are the first part of this plan, what’s the second part of the plan? Software. This week you’re going to see and hear about a lot of hardware. Hardware will continue to get better, faster and more complicated. And great hardware is necessary and we are committed to producing the best hardware in the world.

But it takes much more than hardware to make great games. Without the power of software, advances in hardware won’t translate into the great gaming experiences that people expect. Through software we’re making it easier for developers to make great games by harnessing the potential of hardware advances. We’re arming developers with the tools, the technology and the support they need to succeed in this generation. And with XNA we’re working with our partners to ready the industry for the next generation.

Through software we’re building a limitless online gaming service that allows for continuous innovation. We’re constantly adding new features, new content and new revenue streams for our partners.

In this generation of game development, the next Xbox Live serves as the very foundation of our platform leadership. We’re closing in on a million subscribers for Xbox Live. I want to put that in perspective. Consider this: TiVo, an entertainment phenomenon, took five years to reach a million subscribers. So did AOL. So did HBO. We’re doing it in less than half that time. (Cheers, applause.) Xbox Live has become a new form of social entertainment and is without a doubt leading the online game revolution.

So software is how we’ve innovated, software is how we’ll lead. And our excellence in software defines the difference between us and our competition.

Now, the final part of a successful plan, and possibly the most important, is our partnerships, the working relationships we have with many of you throughout the industry, the very partners who helped bring many of these exciting breakthrough moments we’ve experienced tonight.

Now, gamers buy magic. They love great games and services that keep them connected, amazed and enriched. But it’s not magic that develops, markets and sells those games; it’s the hard work and the collaborative effort between Xbox and all of our outstanding partners that do that.

And the good news is we’ve just scratched the surface. It’s our belief that there is a tremendous opportunity to grow the industry over the next 10 years.

Today, videogame household penetration is roughly 35 percent in the U.S., maybe 25 percent in most international markets. The question is, how do we grow that number to be 50, 60 or 70 percent? We’ll do it the same way we went from entering the game to playing the game to changing the game. We’ll do it with partnerships. We need to continue working together to build a larger ecosystem. By delivering innovative, deeper and more engaging experiences, we can supercharge our industry for future growth. That’s where success and profits really lie, in continually expanding our audience. Together we can make that happen. We can dramatically expand our audience and ensure that videogames take their place alongside other forms of mass market entertainment.

To do this we need to expand the range of content and creative ideas to attract new players. We can also work together to build business models that will enable us to grow the industry in promising regions like Asia, Eastern Europe and Latin America. And we must work together to expand with services like Xbox Live, to provide people with amazing new social and community games.

(Video segment.)

ROBBIE BACH: Now this is going to change the game.

(Video segment.)

(Cheers, applause.)

ANNOUNCER: Ladies and gentlemen, the president of EA Worldwide Studio Operations Don Mattrick. (Cheers, applause.)

ROBBIE BACH: Hey, Don. Watch the light bulbs flash! (Laughter.)

DON MATTRICK: Well, Robbie, you’ve finally caught the ball.

ROBBIE BACH: Well, you finally threw us the ball. Really, it’s great to be here with you.

DON MATTRICK: Thank you. We’re really pleased to be here. And now let me introduce you to the EA Sports team live. Representing FIFA soccer, Landon Donovan. (Cheers, applause.) Representing NCAA March Madness Basketball, Emeka Okafor. (Cheers, applause.) Representing NCAA football, Larry Fitzgerald. (Cheers, applause.) Representing NHL Hockey Marcus Nasland. (Cheers, applause.) Representing NBA Live, Carmello Anthony. (Cheers, applause.) Representing Madden NFL Football, Marshall Faulk. (Cheers, applause.) And finally representing Fight Night, the greatest of all time — (Cheers, applause.)

And, of course, there’s more, more blockbuster titles from EA Games and EA Sports. We’re bringing the sequel to Need for Speed Underground, TimeSplitters, FuturePerfect and James Bond will debut on Xbox Live with Golden Eye Rogue Agent and one of the most anticipated Live games from Digital Illusions in Sweden, Battlefield Modern Combat. (Cheers, applause.)

Robbie, I know it took a while for us to get here, but EA is committed to making great online experiences and helping you grow the Xbox Live community. (Cheers, applause.)

The big winners of this partnership are people who love games. They’re going to see a lot of great entertainment created by EA for the Xbox Live.

ROBBIE BACH: That’s awesome, Don. I couldn’t have said it better. And I want to thank all the athletes and you for joining us this evening. Thanks a bunch. (Cheers, applause.)

We’re certainly looking forward to seeing all these great athletes and all of EA’s great games on Xbox Live starting this summer with NCAA football. So let’s take a look, a final look at some of the EA titles coming for Xbox Live.

(Video segment.)

(Cheers, applause.)

ROBBIE BACH: So tonight we’ve given you a glimpse of the future by showing software advancements that are happening right now. We’ve shown you truly remarkable games that promise to the buzz of the show and major hits over the coming year. And we’ve expanded our partnerships to continue building the Xbox Live service. It’s going to be a great year for all of us.

We entered the game, we played the game at a high level and now we’re changing the game. We’re taking a leadership position to put gaming on par with all forms of media entertainment.

There is a changing of the guard in the industry. Yesterday’s rules are a part of the past. As it has in the past, innovation will vanquish status quo in the marketplace of ideas. Xbox is moving to side with innovation. We hope you’ll join us.

Thank you and good night. (Applause.)