Following the recently released Xbox Series X and S over the holiday season, new information about the history of Microsoft's break into the video game industry has also been revealed. Twenty years prior to the release of this latest console that sold out so quickly the supply shortage is expected to last through spring 2021, Microsoft had tried to buy Nintendo, and Nintendo apparently "laughed their asses off" in response.
In a discussion with Bloomberg, several instrumental minds in the creation of the now-infamous Xbox consoles recounted the hurdles during its foray into the gaming biz, including the failed purchase of Nintendo. In 2000, during the construction of the first console, which at the time was called Windows Entertainment Platform, Microsoft had hoped to use its gross financial resources acquired through its desktop and office software empire to secure exclusive games.
Kevin Bachus, Microsoft's director of third-party relations, described how Steve Ballmer, president and soon-to-be CEO of Microsoft and lover of Nintendo's content had the idea for a meeting. Bachus said "[Ballmer] made us go meet with Nintendo to see if they would consider being acquired. They just laughed their asses off. Like, imagine an hour of somebody just laughing at you. That was kind of how that meeting went."
Bob McBreen, head of business development, elaborated, "We actually had Nintendo in our building in January 2000 to work through the details of a joint venture where we gave them all the technical specs of the Xbox. The pitch was their hardware stunk, and compared to Sony PlayStation, it did. So the idea was, “Listen, you’re much better at the game portions of it with Mario and all that stuff. Why don’t you let us take care of the hardware?” But it didn’t work out."
The Chairman of Nintendo of America, Howard Lincoln, didn't officially corroborate Microsoft's account of the meetings, simply saying, "Nintendo does not talk about confidential discussions with other companies. In any event, nothing came of these discussions."
Nintendo wasn't the first place Microsoft approached. An earlier offer had also been made to video game publisher, Electronic Arts Inc.(EA), which was also turned down. McBreen said "the first company we reached out to buy was EA. They said, 'No, thanks,' and then Nintendo." John Riccitiello, the president and chief operating officer at EA at the time of the attempted acquisition outlined EA's reasons for rejecting the offer: "I was very cognizant of Microsoft’s market power. Look, they may have all been the world’s nicest guys," he said, "but they’re also the guys that shut down Netscape." The publisher of the Final Fantasy series, Square (now known as Square Enix) and Midway Games, the maker of Mortal Kombat, were also approached.
Source: Bloomberg