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Xbox: The truth is with the buyer

Microsoft's upcoming video-game system has a cult following within the company. And the Xbox team hopes it will spread to millions of video game players.

This is a conference room where you could plot the end of the world.

The entrance is flanked by steel panels. The room glows Kryptonite green. Metal walls slide back to reveal technology prototypes. A laser light of green is embedded on the surface of the conference table. Tap on a flat-screen monitor and a projector screen hums out of the ceiling. Tap it again and a live video of the room streams onscreen. This den of destruction is Microsoft's.

This isn't your daddy's Microsoft, though. The room is in a building that sits four miles from the main campus. From One Microsoft Way you have to drive east to the end of Highway 520. And the 1,000 employees inside aren't working on the next killer office application. They're working on the Xbox, Microsoft's first video-game console, due this fall.

There is no other conference room like this at Microsoft. But there's never been a project like this at Microsoft, either. The zombie-shooting, civilization-saving, car-smashing culture of the video-game industry has gone underground into Redmond, and it has meant bringing in "The Rock" of the World Wrestling Federation and a team that considers fun a religion.

If competitors once called Microsoft the Death Star, the Xbox has given birth to a rebel force within.

J Allard, general manager of Xbox, pops open a can of a high-sugar energy drink and says, "We're the Eminem of Microsoft."

He can put his money where his mouth is. Microsoft plans an all-out invasion of the fiercely competitive video-game market. It's going to spend $500-million to market the video-game console, and that number doesn't include TV ad dollars.

"I can't imagine any version 1.0 project in this company getting that kind of funding," Allard said. That figure, in fact, exceeds the marketing budget for the launch of Windows 95.

The Xbox building's hallways are lined with Allard's personal collection of Warhols, Lichtensteins and several commissioned Xbox-centric Mark Kostabi paintings. A big gash in the wall is signed "Seamus was here," penned by Allard after he sent chief technology officer Seamus Blackley nearly ramming into a wall on a remote-controlled wireless skateboard. Blackley jumped off. The board went into the wall.

There's a hole in a second wall, similarly formed by Robbie Bach, whose business card reads "chief Xbox officer." (Officially, he's vice president of the games division.)

Allard and Blackley are hatching plans to build a half-pipe in the lobby. "It's a leased building," Bach laughed.

Even Bach, who once ran Microsoft's European operations and launched three versions of Office, admits Xbox is unlike anything he has done at Microsoft.

"I got to have dinner with The Rock," he said with mild awe. That was during the Consumer Electronics Show in December, when Microsoft chairman Bill Gates joined forces with the WWF star in Las Vegas to unveil the Xbox design. "Experiences like that make me realize that the space we're in is fundamentally a different place. . . . It's Silicon Valley meets Hollywood."

And the Xbox team is its digerati.

At Microsoft's 25th anniversary party last year at Safeco Field, 18,000 employees unleashed the mayhem of a monster truck rally at the sight of a giant robot and a buffed superheroine stomping around a massive screen behind Gates in an Xbox demo.

Recently, the Xbox team decided to give a tech talk, a common practice at Microsoft, where product teams update anyone curious on what's going on. The word "Xrave" was quietly breathed to a lunch table at a cafeteria. They expected about 300 employees; 3,000 showed up. The line wrapped around the Executive Briefing Center. And there wasn't even free food.

The Xbox team even went on the equivalent of a Limp Bizkit concert tour in the fall. The recruiting department organized a series of talks in which Allard and rock-star game developers such as Michael Abrash, creator of PC game Quake, went to about 20 college campuses.

At the Massachusetts Institute of Technology, Allard downloaded the just-finished operating system over the Internet for a packed room of 400 students before he had even shown it to Gates. Students reportedly were so bowled over at meeting Abrash they could barely speak when introduced to the man behind the cult online role-playing game.

Ed Fries, head of internal Xbox game development, modestly admitted that at Gates' annual house party for summer interns last year, "Bill, as usual, had his huge group around him. . . . But this year, I think I had a pretty decent-sized group, too."

If employees aren't drooling over other projects, such as the SQL database server, Bach sees Xbox fever as an internal infection of consumer hype. "Every person in the company is a consumer, and a lot of people in the company are in the target consumer audience," he said.

"Microsoft is in some businesses that are more sexy than others," he admitted. "But it's important that SQL server be successful, it's important for Office to be successful. It's important for Microsoft to have a different mix of products."

To be sure, the mix of products at Microsoft has been slightly less glamorous. This is a company that derives the bulk of its revenue from a computer operating system. In recent years, its stodgy reputation has hurt the company and driven some employees to edgy, young dot-coms. Creating the Xbox was like Gates putting on a pair of hot pants. Inside Microsoft, Xbox is indisputably cool. But will the consumers find Xbox cool?

"They have a definite branding issue to get consumers to realize Microsoft is more than just Bill Gates and an operating system," said P.J. McNealy, analyst for the Gartner Group.

Until the company cult of Xbox translates into several million 25-year-old males plunking down cash for the console, the success of Microsoft's first video-game console remains in question.

"It will speak for itself," Allard said. "We've hired cool people with cool attitudes, taken a cool approach to it, built a cool thing, we're working with cool partners to do cool stuff, and we'll ultimately deliver a cool product. But you can't make something fundamentally uncool cool."

For The Rock, there's no doubt the Xbox will deliver. As he growled onstage in Vegas _ after telling Gates to shut up _ "The Xbox is everything The Rock is: cutting edge, powerful, exhilarating. . . . Do you smell what The Rock is cooking?"

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