Peter Moore (back row, third from left) and his 1974 Yale High School Division I National Championship soccer team

In Part II of our four-part Q&A with with Microsoft entertainment and devices corporate vice president Peter Moore, we debated the timing and impact (or lack therof) of the $299 Xbox 360 Core with early adopters. Today, in Part III, Moore discusses the implications of the then-recent announcement that the founders of the Microsoft-owned developer Rare were leaving the company (as we've previously stated, this interview was conducted in January of 2007), explains the kinds of games he envisions the studio making in the future and talks about why Microsoft is absolutely comfortable with Rare's perverse sensibility.

What should we make of the Stampers' departure from Rare?

Nothing. Chris and Tim have been tremendously loyal to Microsoft since the acquisition of the company. They've been behind everything we continue to do. Certainly Viva Pinata, both of them were instrumental in their own way of getting Viva Pinata up and running. Their legacy will live on with Banjo-Kazooie. The time had come after many, many years of service to Rare that the founders move on and do something different. We wish them nothing but the best. They've put us in great position with Gregg Mayles and Mark Betteridge to come in and step up. Betteridge in particular has been there 19 years, and it's great that we can have somebody with Mark's background in the company be able to step into the shoes. Nothing to be made of it whatsoever.

I asked Phil Harrison about Rare--

I saw that.

--and why they were having trouble regaining former glory. They used to put out games that were five million unit sellers, seven million unit sellers, much higher Metacritic ratings than where they're at. He said that he felt that they were a company that was always prone to insularity; got moreso with Nintendo, and then maybe got a little defocused by the windfall that they got from Microsoft. Perfect Dark Zero certainly got good reviews when it came out--very good reviews, though not GoldenEye-level, but good reviews--

Yeah.

But in hindsight, there are a lot of people saying, "Maybe we scored it too high." Hindsight's 20-20--

The same people who scored Kameo too low. But that's a personal opinion. [Laughs.] So that's fine. It all washes out in the end.

Viva Pinata is certainly a return to form according to reviewers. There are a lot of people who are very passionate about it.

Absolutely, yeah.

But sales aren't there, considering that Microsoft spent $375 million to buy Rare. On the balance sheet, that's already been written off, for sure. But how do you start to earn out on that investment? What's the plan for Rare in the future? Where do they fit in and what are they going to do for the company in order to deliver the hits that they were presumably purchased to make?

Well I certainly think people underestimate the platform-driving presence that Perfect Dark Zero and Kameo had, in particular Kameo. It signaled that this wasn't going to be the same as Xbox 1, which was dominated by Mature-rated games, if you will, and for many people will go down in history as the Halo box or the shooter box. Kameo was very important. Kameo has done well; Perfect Dark Zero hit our expectations from a sales point of view; but these were two launch titles--and in Kameo's case, brand new intellectual property--that allowed us to get where we needed to go very, very quickly.

Viva Pinata, sales have been...fine. I think that the thing that people underestimate is the power of Viva Pinata to continue to sell on an annualized basis, as well as the ability to build intellectual property that's very unique and different. The animated series is doing well. 4Kids [Entertainment] in New York City is delighted. The second series has been greenlit for this year. And as a result, we feel real good that in Viva Pinata, we have established brand-new intellectual property to a consumer that typically has not been somebody we've been able to get to, which is the 8-12-year-old. Also by putting a very rich online element into it.

I'm a big fan. I first saw Viva Pinata in 2003, as they were starting to concept the whole thing out and prototype it out. So don't underestimate the long-term ability of Rare to continue to have a positive effect on the Xbox 360 and further platforms in the future.

But even the reviewers who have liked it, who have been passionate about it, most of them say that it's too hard for kids.

I think--I don't know how much you've played, but you've got the regular offline mode, which--my kids are older now, so it's hard to do what I used to do, which is sit and watch them play. I love co-op in it, because I've got a 15-year-old daughter now, at least I can do co-op with her. It's one of the few games where I can play with a 15-year old.... [Pause.] Sorry, the Patriots just picked off and ran for a touchdown.

You know--it may be something--you may be right. For an eight-year-old or a nine-year-old, it may be a bit challenging. And a lot of people I talk to like that element of it. Because there are some key elements in there: building, collecting, sharing, nurturing, that are very important. I don't want to get too philosophical or wax lyrical, but there are a lot of life lessons in Viva Pinata. It's interesting when you talk to people, or their kids talk to you. I had this instance a couple of weeks ago, in which a parent told me that their daughter had to smack a Pinata over the head with a shovel--you know how when they get bad?--and it was traumatic to her, because she had to have some violence in there, she had to do it to keep control of what was going on in the situation. And it taught her a life lesson of being tough. I thought that was very interesting.

Do you think, though--there's a certain perversity in Viva Pinata, in a good way, and I think in a very British way. In the United States, a lot of fairy tales have been Disneyfied and bowdlerized over the years. One thing that's always been true of Rare and their games is a very British sense of humor--

Yeah.

--and particularly this one, with mating and incest and all of these things that are in the game if you choose to explore it. Not necessarily in a way that would send parents running out of the room screaming, but this isn't your typical Disney--

Yeah.

--or Pixar or DreamWorks kind of game. Was there ever any sort of discomfort about that--

No.

--or were you as a Brit saying, "Hey man, I'm on the same wavelength. I get it."

I love intelligent--I mean, I don't want to be disrespectful; I've lived here a long time, but I liken it to the BBC version of "The Office" and the NBC version of "The Office." You can take that TV program and encapsulate the difference between British sense of humor: the wryness, the sarcasm and the sense of irony--which, without being disrespectful, is rooted in intellectualism and all goes back to Monty Python, where you've got a bunch of highly educated people who can talk about the Spanish Inquisition, right? For better or worse, the great majority of Brits in those days knew what the Spanish Inquisition was. That doesn't play in Peoria. You can't use the Spanish Inquisition as a comedy line in a [U.S.] sitcom. You could do on the BBC.

Many of us--and Chris and Tim are a little younger than me--but so many of us grew up in the '70s in the U.K. with that whole sensibility. Whether it was Peter Cook and Dudley Moore--again, London School of Economics-educated people--or whether it was Monty Python. Then there was all of the BBC sense of humor, which is wry, intellectual, sarcastic and irreverent--we call it piss-taking; giving each other stick; picking on each other's physical deformities--that's very politically incorrect in America, which tends to vanilla everything. So you get the [U.S.] sitcom mentality, which has to appeal to everyone from the East Coast to the Midwest to the West Coast. As a result it loses its edge.

Rare has that edge, because it's born of an educated British sense of humor. I love it. Certainly Conker's Bad Fur Day, even Grabbed by the Ghoulies has a little bit of that piss-take if you play it all the way through. Conker, certainly toilet humor, a lot of it. It's just a unique sense of humor that Rare's always been famous for, and we have no lack of comfort with it whatsoever.

Back to Rare for a minute on the games side. Should we take from Viva Pinata and the new Banjo Kazooie--you talked about the importance of Viva Pinata, even before it shipped, for broadening the audience--should we take from those two games that Rare is being put in the playroom, and not going to be doing the Perfect Darks of the world anymore now that you've got Bungie wildly successful, Gears of War wildly successful? Does it make sense to say we want to build out the platform side? Or are they as free to imagine new concepts across all genres as they've always been?

I certainly think their strength is the former. But their ability to continue--which they've always done--coming up with great ideas for games that are potentially a little off-center, if you will, we always allow them the reins to sit down with us when we do concept reviews and allow their creativity to say, "Here's something three of us have been working on. We've got an idea, and we'd like to prototype this out." Always very willing to hear that from Rare.

Next: Moore discusses his plans to fend off Nintendo and Sony, how Vista can save Microsoft's Media Center and his thoughts on Super Columbine Massacre RPG!