Bill Gates was preparing to walk out on stage to deliver his much-anticipated keynote at the Tokyo Game Show on Friday 30th March 2001. The Makuhari Exhibition Hall was packed with a 4000-strong audience. Executives from all the major Japanese game publishers were there: Capcom, Square, Tecmo, Sega, Namco, the lot. Press had gathered from all over the world, and they were all there to see one thing: the Xbox.
Backstage, Gates turned to Kevin Bachus, at the time Xbox director of third party relations and the man charged with getting all those Japanese executives out there in the audience to make games for Microsoft's new console. "Here, hold this," Gates said, pulling out his wallet. "I don't like having anything in my pocket when I'm talking."
Suddenly, Bachus was holding the wallet of the richest man in the world. It felt thin, as if only a credit card and a driver's license were inside. "I was terrified to even open it," he remembers over a decade later. "But of course that's all you need when you're a billionaire right?"
Gates' star turn at the Tokyo Game Show was supposed to show the Japanese game industry that Microsoft was serious about getting into the console business. Gates, one of the most famous people in the world, one of the most respected businessmen ever, had taken the time to make sure Japan felt important.
But all didn't go according to plan.
Bill Gates on stage with Sega executives announcing its 11 game deal for Xbox at TGS Spring 2001.
Gates spoke eloquently about the importance of the Japanese game industry, of his reverence of Isao Okawa, the former president of Sega who had died two weeks before the show after a battle with cancer. Okawa was a "great man who accomplished many things" Gates said. The Japanese, wearing headsets pumping out frantic translations, listened intently and respectfully, as the Japanese do. But when Gates started talking about the Xbox his keynote turned from insightful industry analysis into a sales pitch.
Gates announced Sega would design eleven games for the Xbox, including Panzer Dragoon, Jet Grind Radio Future, Sega GT 2 and Gun Valkyrie. He announced the Xbox controller S, a slightly smaller version of the reviled controller that would come with US and European launch units, with the buttons positioned to best accommodate styles of gameplay popular in Japan. And he announced Microsoft's Xbox Japan division, run by former Sony game development chief Toshiyuki Miyata, set up to make Japanese games for Xbox to appeal to Japanese gamers and to sign Japanese games made by Japanese publishers.
Miyata previewed Xbox games with videos and demos - Azurik: Rise of Perathia, Amped: Freestyle Snowboarding, NFL Fever 2002 and Halo, which would all launch in Japan. Konami's Air Force Delta 2 and Tecmo's recently confirmed Dead or Alive 3 were shown to highlight the support from Japanese publishers. Gates spoke of the console's 8GB hard drive, saying, "people still underestimate the difference it will make".
"In the Japanese market feedback is naturally different from the United States," Gates said. How right he was.
You can't please everybody all of the time
Xbox Japan marketing during TGS Spring 2001. The poster shows Bill Gates holding a burger and the new smaller Xbox pad.
John Greiner is president of MonkeyPaw, a Californian company that localises obscure Japanese games for release in the west, primarily on the PlayStation Store. But before starting that company the 20-year game industry veteran was president of Hudson Entertainment. He's lived in Japan for years, working with the Japanese, understanding their culture.
We meet just outside one of the food restaurants inside the expansive Makuhari Messe as Tokyo Game Show 2012 kicks into life. A high-pitched screech is on loop, part of the promotional video for the show that bursts out of hidden speakers. "This is my office," he says as we set to down to chat.
"Put it this way, CESA, the organiser of these big events, they were pissed because of his speech and what he said," Greiner remembers. "That turned a lot of developers and publishers away. They had a speech they vetted, and then when he gave the speech it wasn't the same speech. There were parts that were different. He was supposed to be talking about the industry but he was really just plugging the Xbox. Of course! That's America.
"That was a big deal, and people were pissed. The whole Xbox introduction into the Japanese market was not done correctly. They lost the faith of the people who they really needed."
John Greiner, former president of Hudson and now heading up Monkey Paw.
From Microsoft and Bill Gates' point of view, the keynote speech was appropriate. It was exactly the kind of thing they were used to doing at shows in the US: the Game Developers Conference, the Consumer Electronics Show, E3. But for the Japanese it came across as a PR-driven plug.
"I'm not saying they went out of bounds," Greiner says. "But it was a bad start."
Bachus seems taken aback when I suggest the speech didn't go down well. "People liked it," he says. "It sounds a little arrogant, but from their perspective and from my perspective as a guy who had been in the game industry my whole career, I thought it was validating to have someone like Bill Gates go to the Tokyo Game Show and show that commitment. That was a really big deal and I really enjoyed that.
"The expectation was we were coming to ask the Japanese industry one last time to support us and to explain why and to give the same kind of thing you see Sony or Nintendo give at E3, which is, here it is and this is what we're doing.
"Because they didn't really do that at TGS at the time, there were questions like, 'well do this but could you please keep it relatively non-denominational and sort of give philosophy?' For whatever reason, that message wasn't communicated properly.
"Look, you know from dealing with the game industry, you put ten guys in a room and you get twelve opinions. I didn't have the impression after that presentation that people were upset. There were certainly, I'm sure, some people who felt we were being typical western barbarians coming in and unsubtly pimping our product out, but Bill thought that was what he was there for.
"The speech was absolutely appropriate to an E3, to an ECTS, to a GDC. But because there had been some expectations set and because we were being given this opportunity to give a keynote, I'm sure that may have rubbed some people the wrong way. But that had no impact on our relationships. In fact, we heard a lot more positive about the fact Bill came and spoke and spoke eloquently about the game industry and how important Japan was.
"You can't please everybody all of the time."
Gears in motion
Microsoft's Xbox adventure in Japan began years before Bill Gates' 2001 keynote speech. When the Xbox was being created in Redmond, Bachus and Seamus Blackley, the two Xbox co-creators who spent the most time in Japan, always knew the market would be a challenge. At the turn of the century Japan dominated the console games industry with a whopping 30 per cent of the market. The Sega Dreamcast, which hadn't performed well, was made by a Japanese company. Sony's PlayStation 2, which had performed wonderfully, was made by a Japanese company. And the Nintendo GameCube, also made by a Japanese company, was fast approaching.
"We were basically going to play in Sony, Sega and Nintendo's home stadium," Bachus says. "As a result, Seamus and I and other people from the team put a disproportionate amount of effort into trying to make Xbox attractive in Japan, but there were a bunch of things that were lined up against us."
We were basically going to play in Sony, Sega and Nintendo's home stadium
Kevin Bachus and Seamus Blackley toured Tokyo with a prototype Xbox. It was taken to Sony Computer Entertainment's building.
The Xbox was so named because of its ties to PC gaming - unsurprising, really, given the company behind it. It was built based on familiar PC gaming development processes and tools and technologies. It came with a hard drive, would facilitate patches and would connect to the internet. All wonderful, forward-thinking additions to the console landscape sure to please western developers.
Unfortunately in Japan there was no such thing as PC gaming. The likes of Konami, Namco and Capcom were console developers. On top of that, Microsoft faced a perception issue. Most Japanese publishers of the time thought the Xbox as a console for American games that most Japanese gamers wouldn't find interesting.
"So even before we lifted a finger there was a perception among game companies and consumers that this was a console made for other countries, and even though it might be available in Japan it really wasn't for them," Bachus says.
But, in truth, Microsoft didn't help itself when it came to Japan. Some of the decisions it made while designing the Xbox made some of the Japanese games community scratch their heads.
The Xbox was a beast of a games console, heavy, bulky and devoid of subtlety. It was made out of inexpensive black plastic with a controller seemingly made for hands the size of those pointing finger gloves you see at baseball games. It was everything the Japanese thought an American-made games console would be.
"We thought it would be more like what PlayStation 3 looks like now, something sleek and sexy," Bachus says. "For a number of reasons, mostly related to cost, but also partly related to thermodynamics of engineering the box - air flow and the size of components - we just weren't able to do that. The Japanese looked at that and it reinforced the notion this didn't have a Japanese aesthetic. This was a console that was for western gamers and was being made available in Japan."
Microsoft's Xbox team received all sorts of feedback from Japan. Ed Fries, then vice president of Microsoft Game Studios and one of the co-creators of Xbox, remembers being confused by the advice he was given. An earlier PC game Microsoft had brought to Japan had a main character with only a few fingers, and Microsoft was told that was a taboo because it had a connection to the Yakuza cutting fingers off.
When it came to the Xbox, the befuddling feedback continued. "We were told we couldn't call it the Xbox because X is the letter of death," Fries remembers. "We were told we couldn't make it black because black is the colour of death. I was like, isn't the PlayStation black? Rules that apply to you as an outsider don't necessarily apply to insider products."