Connecting with… Christina DeRosa, Xbox Live

Q&A: Zune will be a content service across multiple screens

By Jennifer Netherby -- Video Business, 9/25/2009

VB: Where do you see the Xbox 360 fitting in as more connected devices come to the home?

DeRosa: Xbox 360 is a social entertainment platform, and undisputedly by fall, with Facebook, Twitter, Last.fm and Zune video, we will have established ourselves as such. Our aspiration is to just continue to build out the entertainment portion of the service to complement gaming. We want to be the de facto box in the living room that delivers all your entertainment choices, and I think we are best positioned to do that in many ways. We are inherently a software company. Much of the magic you see on the screen is software, and that is one of Microsoft’s core competencies. We can continually enhance or even reinvent the experience that you have because we re-release our software—it isn’t console dependent. It is now a matter of bringing it to more people with more partners and with more internal-built services, and ultimately porting the Live service beyond the console. That is one of our aspirations as well, and you’ll see that with Zune, which will be a content service that is across multiple screens.

VB: In terms of Netflix, do you think that has brought in new video users on the Xbox?

DeRosa: Bringing Netflix to Live did two important things. First, I think existing members will spend more time on our service because we have Netflix. Second, we’ve also attracted some new people because of Netflix that have gone out and said, ‘Wow, this is a really great entertainment service and I want to have access to it.’ We really focus a lot of the subscription service on retaining our existing members, keeping them happy and adding more features and value. Netflix has helped us in that regard. The community is more engaged and will stay longer.

VB: What about original content? Is that important, are users responding?

DeRosa: I think unique experiences are important to the platform—from gaming, to social entertainment to original shows like The Guild. Halo is exclusive to our platform and offers a unique gaming experience, and other types of exclusive hit experiences are important to us as a differentiator. For example, 1 vs. 100 is an original social entertainment experience that we’ve built and invested in, and now for the first time, there is an interactive game show on your television to play and participate in. We also partnered with The Guild and Felicia Day to bring a Web property to the platform exclusively, because we knew it appealed to our consumers, and she is a wonderful, innovative, creative person whom we wanted to work with. It is important, because it gives us a unique value proposition, and also is a gift to our community, a way of saying, ‘Look, this is something special we’ve designed just for you.’

VB: Up to now, Apple has dominated digital movie sales because of the iPod, but the focus is moving more to the living room, where Apple isn’t available yet in a big way. What do you see as the competition?

DeRosa: We’re certainly not blind to what people like Roku or Apple or Amazon or Netflix or anyone in the entertainment space is doing. We don’t only define our competition as other consoles; we look at what’s going on in the entertainment industry at large. Xbox Live is an entertainment service, not just a gaming platform. We look at all of that landscape holistically and ask, ‘What is unique about us, what are the features that are unique about us, why is a user going to spend time with us versus what is out there and available to them? ‘That’s how we want to build our service. At the end of the day, the customer has to want what you’re going to build.

VB: What do consumers want, where is the business going?

DeRosa: I think like any business, it will continue to evolve as consumers’ behavior changes. You can’t over-innovate. The consumers have to be ready to change their behavior and their viewing habits.