Microsoft has a big stake in games on multiple platforms, with Windows gaming, Xbox gaming, and casual gaming--which now itself extends to Windows, Xbox, and mobile platforms. It currently aims to bring all three together from a development perspective with a development environment called XNA. Henson went through each of the three gaming platforms in which Microsoft operates and outlined the company's current perspectives.

Windows
"There are hundreds of millions of copies of Windows out there, and what's interesting about that from a gamer perspective is how big that audience is who are playing games," Henson said. "When we've gone and done research on this, the feedback we've gotten is that about half of the folks out there identify themselves as gamers. That's a really, really big audience of gamers out there." He also noted that online gaming specifically is growing at a huge rate, with some projections indicating that, five years from now, online Windows gaming could see yearly revenue of $6.8 billion. In terms of the total gaming audience, Henson said that about 80 million people play Microsoft's packed in games such as Solitaire and Minesweeper at least monthly. (For the record, I might personally have a decade-long Minesweeper addiction.) He claimed that this "is really kind of interesting when you think about some of the titles we're putting into Vista and some of the integration with the game explorer we're doing in Vista." Windows Vista, the consumer version of which was recently delayed until 2007, aims to simplify and centralize the organization of games on the PC, which will in turn hopefully bring in new audiences who were previously intimidated by the complexity of installing and maintaining games on the PC.

Console
"We're still on track for our four and a half to five and a half million [Xbox 360 units shipped by June]," Henson assured me. The quoted figure is Microsoft's most recent shipment estimate, a revision of the initial goal of having three million units shipped by the end of February. And when will we be able to actually go into a store and pick up an Xbox 360 hassle-free? "Soon," he laughed. "We've upped our overall production capacity and influx two to three times what it was previously. We're well on track." By that same time frame, the system will have about eighty titles released, with fifty retail games and thirty on Xbox Live Arcade.

Casual
Microsoft first introduced its Internet Gaming Zone almost 10 years ago. Now called MSN Games, it servers over 30 million users, 9 million of whom play games on the service at least monthly. Another 16 million users play casual games through MSN Messenger. Of course, many of those games are now playable through Xbox Live Arcade, which has seen a surprising degree of success. While Henson estimates that, with web-based and cell phone casual games, about 1-2% of users who play a game's free trial end up actually purchasing game, that trial to purchase conversion rate is an astonishing 20% on Xbox Live Arcade. "We're seeing an incredible pickup on people actually buying the games," he said. "It's a really interesting metric, because it's an order of magnitude greater." That of course says a lot about the potential for casual games even among the core gaming audience.

XNA
(This section refers to the development tools Microsoft was showing off at GDC. If you'd prefer to skip straight to the interview section of this article, feel free to turn the page now.)

First unveiled two years ago at GDC, XNA is a suite of Microsoft's software development environment, targeted specifically at games. It unifies the development environments of Xbox and Windows, making it easier and faster for developers to work on games across multiple platforms (well, Windows platforms). Despite the original announcement two years ago, there has been little practical news regarding XNA, but at GDC Microsoft gave an XNA preview disc to every attendee at the conference.

To demonstrate what can be done with XNA, Henson showed me a couple small game demos. First up was a version of the traditional game Mahjong. The game's author originally wrote the game for cell phones using Microsoft's C# language, and with XNA was able to get it running on Windows with the Xbox 360 within a day with "100% code reuse." He was then apparently able to port it to Xbox 360 without a developer kit, starting one morning and finishing by the afternoon. In a few more days, an artist and a shader programmer added a bevy of visual effects to make the game more on par with other 360 casual games; the improved 360 game was then able to be rebuilt instantly to run on Windows.

Henson also showed an example relating to higher end game development. "We think there are some really interesting prototyping opportunities here too," he said. He demonstrated a prototype of a life simulation game, in which the player drops seeds onto a green planet, resulting in flowers sprouting. By placing the seeds in strategic locations, the flowers cross-pollinate and new types of plants grow, leading to more chain reactions. "The point is, they were able to get something up really quickly and start playing with these game ideas," he said. The prototype was created in C# within a couple weeks. The game's programmer, a developer from the Age of Empires team, had never used C# before.

(Turn the page for some questions regarding reactions to recent events and future plans.)

A Few Questions
After Henson's explanations of Microsoft's current game-related initiatives, I asked a few more general questions about recent announcements and revelations. He talks about current and future plans for Live, his thoughts on Sony and Nintendo, and more.

Shack: Microsoft recently announced that it will be opening up its Xbox Live platform to developers. Since we've already seen certain companies make use of their own servers for various purposes in Xbox Live games [for example in the case of Bungie's stat tracking for Halo 2 or EA's authentication servers for its online games], what is the significance of this announcement?

Scott Henson: A couple things. One is, the big news for developers is that what we've delivered to Bungie and these guys in the past was a little hard to set up, and it wasn't the most managable in the world. We've added more scalability to our servers, we've added more management code to make it easier for developers to maintain these servers. So that's kind of the big win, the enabling technology.

Shack: So the difference is that it's now officially supported.

Scott Henson: It's an official part of our Xbox developer kit. Before you kind of got it off to the side. At the end of the day, all of this is about enabling developers on our platforms to bring better games to our platforms. I've got guys here [at GDC] giving 60 [combined] hours of [development-related] sessions. We're getting great feedback from the developers, and we're really excited to be delivering. At the end of the day, my job is all about developers, developers, developers [developers] and I'm super excited about what we're doing at GDC.

[Note: For some reason, I completely neglected to bring up Steve Ballmer after Henson's apparently coincidental phrasing of "developers, developers, developers." My sincerest apologies.]

Shack: Do you ever see Marketplace expanding beyond the current 50MB game limit? You've got demos on there upwards of a gigabyte, so will we ever see full-scale titles?

Scott Henson: Well, a couple things. One is, technically, we're obviously able to distribute that--I mean, there's a 1.2 gigabyte demo up there for Project Gotham Racing 3. So technically we can distribute all kinds of different things. But the retail members of our ecosystem are super important to us, and that relationship is super important to gamers as well, so I think that what you'll see is that we'll continue to go the path that we're on. Byte-sized games will continue to go through Xbox Live Arcade, games that would never find a home in retail. Geometry Wars would never find a home in retail, right? You will find an outlet in Xbox Live Arcade. In retail, these five dollar games just wouldn't make sense. But I don't think you're going to see, any time in the near future, full-scale games. You will have fully-featured demos so you'll know what the games are like. One of the most gratifying things I did on the the tour I just did in the last couple weeks, was to hear the gamer press play The Outfit demo and tell me "You've got to check it out, because the multiplayer part is the killer part of that game." So of course I went and checked it out and they were right, it's pretty amazing. So that's oen of the powers of Marketplace in general, that people can check this out and say, "This is a pretty cool game here, I've got to go buy it." Obviously we had hundreds of thousands of downloads with Fight Night [Round 3] and that translated into a tremendous success in February, so I think that's going to continue to be a big hit.

Shack: There are currently some interactions between Xbox 360 and Windows systems. Are we going to see any additional functionality in this regard when Vista rolls around?

Scott Henson: I'm thinking. Obviously, we have the ability to stream music, to stream photos. One of the most requested features has been the ability to stream videos. That's something we're looking into. We haven't announced anything, but I think with Vista you'll see that becoming a more pervasive thing. I'm not making an announcement here, but that's something we're looking closely at. Of all things I can think of off the top of my head, that's one that probably will go in. Other than that, you'll see better quality, better compression technology, audio quality will continue to improve. That doesn't mean there won't be other things.

Shack: Speaking of Vista, do you have any plans of making the Vista version of Halo 2 playable online against Xbox players?

Scott Henson: It's certainly something that we've talked about. Whether that will be enabled in this timeframe at this point is not clear. I think right now they're just trying to figure out how to make the most of the Windows platform, how to make it a great Windows title, what would make it a unique Windows title. I don't know exactly what they've talked about, but I think they've got some pretty cool plans for Windows gamers just in general.

Shack: How will we be seeing the Dashboard improve on the 360?

Scott Henson: I don't think we've given an official date yet, but in the not so distant future you will see another update that will improve a lot of how stuff is sorted and shown in the Marketplace, just to make it more efficient. We're going to do a lot of nip and tuck cleanup work. One of the biggest things is the ability to download things in the background.

Shack: Thank you!

Scott Henson: Yeah, as an avid Marketplace downloader I can say hallelujah! I don't know what the official PR line is on the availability, but it's not that far away.

Shack: Do you have any feedback or reactions to what Sony has been announcing over the past couple of days?

Scott Henson: Well I was in both the Nintendo keynote and the Sony keynote, and for what it's worth from a keynote perspective I really enjoyed the Nintendo keynote, it was fun. The Sony keynote, I just walked away very flattered.

Shack: Ouch!

Scott Henson: Well, you know, I did, I was thinking, "Wow!" You know, I've been working on Xbox Live for a long, long time, and when I first started people were like, "Unified service? On broadband? With voice? Are you insane?" We had these conversations and people would just look at us crosseyed, saying, "Are you crazy?" I left the keynote this week just thinking, "Wow, we've really fundamentally changed people's expectations of what a next generation console should do, including Sony." And I was just really excited about that. I think it really validates our strategy. I'm very aware of the road they have ahead of them. I'm very aware of how much it took to invest in these technologies and to make them seamless. It is a big, big undertaking. Worldwide billing with microtransactions is a big, big undertaking. I was part of the development team and I know what that means. So, they've got a very aggressive schedule ahead of them. Best of luck delivering first libraries next week. Final network coming up in September is very aggressive. We were very fortunate that for us it was up and working a couple years before we actually launched Xbox 360. So those were my initial reactions.

(Turn the page for Scott Henson's thoughts on Nintendo and physics cards.)

Shack: You mentioned Nintendo. Sony and Microsoft are definitely competitors this time around, that's clear, but Nintendo has stated that it's taking a different route with Revolution. What do you think about the company's overall strategy and how it will affect Microsoft and the rest of the industry?

Scott Henson: Well, a couple things. It excites me as a gamer. I was one of the first people to preorder a DS. I believed in the DS before the DS ever came out. People thought I was insane, and the reason I believed in the DS is that I really think Nintendo does a fantastic job of innovating in their hardware and showing that off. It was really exciting for me to see Zelda, it was really exciting for me to see Super Mario Bros. coming to the DS. Also what they're doing with the stylus, I was really excited about the Brain Age game as well. From that vantage point, they deserve kudos. I think it's great. We have very similar goals. We want to broaden the audience, bring new kinds of games in, games that don't have a one hundred or two hundred person cycle. Of course there's a place for those games, but this is why I'm showing you the demos that I have. A lot of what Nintendo [president Satoru Iwata] talked about, I was thinking, "Yes! That's why the XNA framework is so important, that's why Live Arcade is so important." So I think to a certain extent, that was also very validating. On a personal note, I just want to see the payoff on that controller so bad. [laughs] I can just taste it! I was there at TGS last year when he announced it, and I was just thinking, "Please just show me a game using that controller!" I'm still just dying here, but I know at E3 they're going to have the payoff. But yeah, yesterday [at the keynote] I was hoping they'd show it off.

Shack: Yeah, it's too bad they didn't, I guess they're saving their trump card for E3.

Scott Henson: But yeah, he had that great story about the Metroid team, how they were really skeptical about the controller, and how they changed it. [During his keynote, Iwata described changing the controller after showing it to the Metroid designers, who did not believe their traditional style of game would work with what was the prototype at the time.] You know, I thought for sure Iwata was going to pull out a Metroid demo with that thing.

Shack: Nintendo has a lot to prove this time around.

Scott Henson: Yeah, well trust me, in my hallways I was saying, "DS is going to rule the world, I think it's an amazing product, I think it's really cool." I'm a big believer in broadening the market. I have two little girls, a five year old and a two year old, and I'm constantly thinking about what we can do to bring these guys in that we can all feel good about. Live Arcade is one of these ways, we play Marble Blast Ultra, Feeding Frenzy came out recently. But the same reason I get excited about the DS is the same reason I get excited about Live Arcade and the XNA framework. So to sum that up, I think a lot of what Nintendo is trying to do to broaden the audience is dead square in what we're trying to do as well.

Shack: So speaking of the portable arena, can you give any response to Dean Takahashi's comments about a portable Xbox?

Scott Henson: This is where our PR would say "We don't comment on..." It's a rumor.

Shack: That's what I thought. [laughs] So how do you guys feel about AGEIA's PhysX PPU, the actual separate physics card itself for the PC market?

Scott Henson: I don't know what the official PR line, but I do think innovating in that space, whether there's a card or not, is going to advance gameplay. The more believable some of these things are, the more drawn in gamers are going to become. I think for that kind of games where you're looking for real immersion, that kind of technology will be great. Whether that's from an add-on card, I don't know. I think that'll be hard for people to understand until they can really experience a great game that matches up with it. I believe in physics as a key part of the overall gameplay experience, but the card part will require a game that will make people say, "Oh my god, I never would have had this experience without this card!" It's a little different from video cards, because you can't look at it and say, "Oh, that's because of this thing."

Shack: Doesn't work in screenshots.

Scott Henson: No, it does not work in screenshots at all! [laughs] So we're apparently going to have to invent some new way of experiencing screenshots or videos.

Microsoft PR: We're going to have to wrap this up, that's all we've got time for.

Shack: Thanks for your time!