New Xbox head Phil Spencer discusses evolving games industry

By John Gaudiosi

Phil Spencer, the new head of Xbox at Microsoft, came from game development, a similar career trajectory as Electronic Arts CEO Andrew Wilson. Spencer worked on games as varied as Voodoo Vince, Gears of War, Halo, and Forza over his 25 years at Microsoft. He now leads the Xbox, Xbox Live, and creative teams, which include Xbox Music, Xbox Video, and Microsoft Studios, as well as Kinect, Surface, Windows PC, and mobile phones.

With Microsoft (MSFT) chasing Sony (SNE) in the early leg of the next-generation race (Sony has sold more than 7 million PlayStation 4s, while Microsoft has “shipped” 5 million Xbox One consoles), Spencer has been tasked with repairing the early PR damage that plagued last year’s Xbox One launch and enticing gamers to upgrade to next-generation gaming and entertainment. With the success of Electronic Arts and Respawn Entertainment’s Titanfall, a Microsoft exclusive, Xbox seems to have righted its interactive ship. Spencer, a gamer at heart, offers his thoughts on the evolving videogame landscape, which includes the burgeoning free-to-play games space and virtual reality, in this exclusive interview.

Fortune: What did you learn from the Microsoft launch last year and the early vocal opposition from core gamers around issues like DRM and used games that ultimately reversed some functionality of Xbox One?

Spencer: We took the feedback we got last year to heart. I took it personally — you’d be hard-pressed to find someone at Xbox who didn’t. Early on, we could have done a better job communicating our intent more clearly, but I’m proud of the way we responded, changed our plans, moved forward, and ultimately delivered a successful product that fans are really enjoying. We were reminded just how important it is to listen to our fans. We proved they can impact the products we make. Maintaining an open dialogue with Xbox fans is a commitment we’ll continue to uphold.

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