Peter Zetterberg is business development manager for Microsoft Game Studios in Europe. He's the first point of contact for any developers looking to work with Microsoft as a first-party publisher. He sees on average 600 game proposals every year, and it's his and his team's job to work through them all, and whittle them down to the average number of releases that come out under the Microsoft Game Studios brand - just three per year.
In this exclusive interview with GamesIndustry.biz, Zetterberg discusses in detail the challenges of establishing MGS in Europe, Microsoft's publishing policy in the region, its criteria for working with independent developers, and why the company is always looking out for the next Halo.
Q: Why did Microsoft Game Studios decide to establish a European division last year?
Peter Zetterberg: It's our job to identify talent and talk to a lot of developers. No developer is too small. I think that has been Microsoft's greatest strength now, because it's biggest weakness as a corporation has been its size. We've always moved on a global basis and this means that sometimes we have missed out on the smaller things. If you look at World of Goo or Crayon Physics, these can be easily over-looked by a large corporation that thinks global.
In Europe it becomes even more important because there are 25 countries, 20 languages and so many different cultures so we have to learn to think small while having the games that have global relevance. That's a challenge. And there's a reason why Microsoft hasn't been that successful in the past on the continent because they sit in Redmond and it's hard to understand how to make fifteen games for a smaller European market.
Q: So what exactly is Microsoft's current first-party publishing philosophy?
Peter Zetterberg: We want to publish games that drive console, PC and operating systems sales. And we do that by making benchmark games that people want to play. The best sci-fi FPS should be Halo, and people should buy the Xbox 360 to play it. The same way that Mass Effect is the best sci-fi RPG, Fable is the best fantasy console RPG. We want people to buy the consoles through the games that we publish. And that goes for developers and publishers as well. We want developers to look at our games and think "I want to make a game for this console because it has the quality that I'm aiming at". The same goes for publishers, we want them to see the game we launch and become part of that business.
Q: Why should a developer or publisher tie themselves to one format, your format, with an exclusive deal?
Peter Zetterberg: It's obvious we only do games for Xbox 360 and Windows. And we hope by limiting the technology scope and staying with core platforms we allow more time, resources and focus to go into the creative part of making a game. I know if you speak to some developers they'll have a different take on it, but all-in-all, doing a great job with one platform will give you more reason to make a greater game.
Q: What would be one of the key differentiators between your own publishing and that of a third-party?
Peter Zetterberg: As a publisher we don't want to do replacement products or slot fillers. Our previous experience shows that you have a very opportunistic approach to publishing as a third-party. You need to have a constant portfolio of games to be strategic and have brands on hand. As an independent third-party you also need to replace games that are delayed, or find games for the Wii or DS for mid-summer next year because that's when you need revenue.
We don't work like that as first-party at MGS. We try to have a strategy for every game that we sign on. With every game we should ask if we are making a franchise. I haven't been a part of any discussion where we talk about slot-fillers or replacement titles, or a game is needed for this time of year in order to gain revenue.
Sometimes it means we work on a very long project for three to five years and maybe it takes away some of the spontaneity that you'll see with third-parties, when games come in and they get excited and get the deal done quickly with a developer. It might take away some of the entrepreneurial excitement, but it certainly makes it more of a challenging process to find that next Halo or find that next Gears of War. We get a bit more stability, and maybe sanity, to a project.
Q: How do you avoid treading on the toes of your publishing partners? Halo is the premier sci-fi first-person shooter on Xbox 360, but other publishers have their own sci-fi shooters...
Peter Zetterberg: We don't want go in and compete with our fellow publishers on our own platforms. You could say that Halo competes because it's a sci-fi FPS, and when we launch a game it creates a vacuum that makes that game the only option at that time. But it's only every third or fourth year. So we believe that launching a great game experience like Halo or Gears of War will inspire people to buy our console and inspire publishers and developers to create games for it. So, it's not about dominating, or competing with EA or Activision, but inspiring everyone to make games for our platform. That's important for us. When we look at games, there are certain games, themes, genres and IPs that we choose not to even pursue at step one because we know it's an area that is already well populated.
Q: Is there a slightly different mission for MGS Europe as opposed to the team in the US? Or is it simply a practical situation to have a division so close to European developers?
Peter Zetterberg: When it comes to genre diversity this is where we come in and play an important role in the EMEA region. We need to find games that are globally accepted, that people love on a global basis. Like music or singing, things that we all love. Then we can nail the local values to it. So with a music game, because everybody loves music, so you do an Abba version for Sweden, an oompa music version for Bavaria, crazy disco for Italy. Global themes but with local versions. That's something that Microsoft, as this big global company, has needed to improve. And having MGS Europe is a great opportunity to find globally great games with locally relevant content.
Q: You're the front line for developers to pitch new game ideas to Microsoft. How many do you deal with in a year?
Peter Zetterberg: It's extraordinary how many ideas are created each year and sent in to publishers. We see around 600 a year. These can be anything from a piece of paper or an email, to a full blown presentation with demo, videos, concept documents. With a third-party, only 60 of those would go into a forum where creative, marketing or sales would look and evaluate the game. I would say with MGS so far our current ratio is to put about 30 games go into some sort of discussion meeting where we evaluate them. Out of those games, five might be taken to a greenlight process.
Q: Does Microsoft Game Studio Europe have the autonomy to greenlight a project, or do you need to take it to Microsoft US before it's good to go?
Peter Zetterberg: MGS Europe can have it's own greenlight presentations. We do have our own decision making process but when we commit to large, franchise developments it's obviously something where we need the entire MGS approval. Of those five games, we maybe sign three a year. And we never cancel games, we work with them to get them out. Maybe we sometimes announce them earlier than we should, but we stick with them, we have our resources team work with them as much as we can. It's crunch time down in Guildford now and we have people working their butts off to make Fable 2 happen. We do not, we shall not cancel games.
Q: From 600 game ideas to only three real, solid, videogame projects. A lot of developers must have to face up to some hard truths...
Peter Zetterberg: Usually when we tell this to developers they like to go back and tell their staff. Because you have these creative developers and these new development teams that have no real experience. It's good for developers to understand that there are 599 other game ideas that are competing with you. Unless you have a track record, you can prove what you can do and the individuals in your team are senior enough, it's unlikely you'll get it signed with any publisher. The Wii and DS has helped that, because games don't have to have the production values. Two years ago everybody thought that production values were what made or broke a game, but the Wii and DS clearly show that great content and great gaming experiences can be created without that tremendous production value. They allow developers to go ahead and do their thing without having a team of 40 people.
Q: Do you have to plans to increase the number of titles you'll put out? You have three big hits over twelve months with titles like Mass Effect and Halo 3, but surely you'd like to have six blockbusters a year, or more?
Peter Zetterberg: We would be prepared to increase that number if the games are relevant. We're not going to increase the number for some sort of market reason. If the game is right, the developer is right, if we're behind it, and that means we go from three to four per year, so be it. If we met six developers with great ideas, we would champion them.
Q: So you're cautious for quality reasons. As the format holder, you need to be careful that poor games don't become associated with the console itself?
Peter Zetterberg: If we publish games that are not high quality games - and we've done a couple of games that maybe we shouldn't have done - the console is somehow going to suffer because we we are tied together with the general perception of the machine. If we publish games that don't live up to public expectations the console will suffer.
Q: Are you happy with your work in Europe so far? Are you hitting all the goals you wanted to reach when you first set up as MGS Europe?
Peter Zetterberg: As MGS we're growing as a publishing unit according to plans. From a business development angle we've been really busy going out to developers on the continent and I think we've been very successful in reaching out to developers. The challenge that we could face at times is that developers still think we're still a small little satellite here in Europe, and it's more valuable for them to go to Redmond. That's not true. We are the point of contact here and they should come to us and get the answers that they need. Changing that perception is something we're working on. I remember as a developer myself I flew to Redmond often to pitch games to Microsoft and it was exhausting because there was nothing here in Europe. It's changed now and we invite developers to come and visit us whenever they can. Even within the last five months we've changed that perception, especially with our friends up in Sweden and Denmark, they know they can call me if they have game ideas they want to pitch.
Q: When you set up MGS Europe you were working with RealTime Worlds and Bizarre Creations on Crackdown and Project Gotham Racing. Now there's no Crackdown sequel and Bizarre has been bought by Activision, are you looking to work with smaller studios again as these established teams have gone on in their own directions?
Peter Zetterberg: The time that we worked with RealTime Worlds and Bizarre, they were quite small, but now they are well established. When we first started working together there were several developers that were small and we can list a number of good developers in Europe we're now speaking to. We haven't gone smaller, necessarily, but we talk to any talent that has potential. Any talent that we believe has a game that is valuable to us. We haven't changed in anyway, but we're having discussions with developers who are the size RealTime Worlds were two years ago. I think there's a more open attitude to developers. We support them at MGS to help them get dev kits if we believe they have potential, which Microsoft never did before because they sat in Redmond and couldn't possibly see the smaller developers. We're listening more to smaller developers and we're still working with the more established ones.
Q: What, specifically, are the strengths that you look for in your developer partners?
Peter Zetterberg: The most obvious thing is to try to be the best in your field. From producing average games but are on time and on budget - there are several developers who pride themselves on that. Or whether you're best in a technology field, or whether it's AI, or something like narrative gaming. Too many developers try to be too good at many things and it dilutes their edge.
Another important point is self-perception. We meet some developers that have a staff of about 25, they've never done a game before but they're clearly talented and passionate. You can tell they haven't been in the industry for very long because they regard themselves very highly and they haven't even produced a game yet and they want to own the IP, they want millions of dollars for it, they want 45 per cent of royalties - it's cute in a way because it's so naive. But if they have the talent you can slow them down and educate them. We've done that in a couple of cases with European developers where we liked their ideas and attitude even if it was a little skewed.
Q: And that hasn't ended in a bad relationship? Developers are willing to take that sort of feedback and work with it?
Peter Zetterberg: There's one developer where we told them pretty clearly that they can't expect us to let them retain the IP and expect such a high payment. We told them they need to be responsible with how they perceive themselves. You need to understand where you stand in the food chain if you've never published a game before. That's a minus, so what can you do to compensate for that lack of track record? That's what a developer should think about and work on. It's not about being mean, it's about being fair. Publishers are known for keeping discussions going forever and never giving a final answer. We're becoming masters of the final answer. It's not about treating developers badly. We try to do it as early as possible, we might end up biting the sour apple if we say no to a game that two years later goes on to be a massive franchise, but we have to be consistent with developer relations.
Peter Zetterberg is business development manager, EMEA, for Microsoft Game Studios Europe. Interview by Matt Martin.