Former Microsoft Executive Says Company Made Mistakes With Zune, Exploited PS3’s Failures

Music Service For Xbox

Former Microsoft executive Robbie Bach says Sony made numerous errors transitioning from the PlayStation 2.

Microsoft is killing the Zune, and could be bringing a music service to Xbox Live, but why did they fail?

In a nutshell, they weren’t competitive and Apple made very few mistakes with the iPod line. That’s according to former Microsoft executive Robbie Bach, who was at the company around the launch of the original Xbox, who was speaking at the Northwest Entrepreneur Network.

Speaking on Microsoft’s strategy with the Xbox going head-to-head with the PlayStation 2, Bach said the company wanted to approach things differently. One example was including a hard drive in the console, which enabled downloads that couldn’t be done on the PlayStation 2. Microsoft also focused on broadband for the Xbox – not dial-up, which the PlayStation 2 used – which led to the launch of Xbox Live and Sony reportedly surveying Xbox Live users to find out what they loved.

Bach says there was a meeting with Bill Gates in 2001 over removing a modem in favour of broadband, which wasn’t a popular decision with Gates. It resulted in three months of e-mails exchanges discussing the decision, and another meeting to convince Gates no modem was a good idea.

On Zune, Bach says, if he could launch Zune again, media players would be skipped. Instead, Bach says Microsoft would go to the then Windows Mobile team and pitch them the music service. He says the result was Microsoft chasing Apple as media players began to disappear; Apple now uses the iPhone and iPod Touch as the key music devices – the iPod Nano has been relegated to a niche device.


Bach added Microsoft also gained partners in EA and Activision, for example, that allowed the company to be competitive with Sony. He says the support came out of self-interest, because Sony would have been the only company offering similar consoles to Microsoft. With Zune, Microsoft didn’t get that support.

It was also difficult for Microsoft to make up ground because Apple weren’t making mistakes. With the Xbox, Sony didn’t transition well from the PlayStation 2 to PS3: the company launched late, were expensive and launched a platform developers found difficult to use. Sony had 70 percent market share.

Published: Tuesday, May 15th, 2012 Last Modified: May 15, 2012

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