Xbox 360 exec leaves Microsoft

Computerworld - Less than two weeks after Microsoft Corp. announced a $1 billion charge to extend the warranty of failing Xbox 360 consoles, the executive who headed the company's video game business has resigned to take a job with game publisher Electronic Arts Inc. (EA).

Peter Moore, 52, the former president of Microsoft's interactive entertainment business (IEB) group, resigned yesterday, Microsoft announced. Moore, who had joined Microsoft in 2003 after a stint as Sega of America Inc.'s chief executive, will oversee EA's sports games.

Microsoft said that Moore's departure was unrelated to the July 5 announcement of a more than $1 billion charge against earnings to account for an "unacceptable" number of hardware failures of the Xbox 360. The charge will pay for a warranty extension from one year to three years for the console.

"Peter has contributed enormously to the games business since joining Microsoft, and we are sad to see him go," said Robbie Bach, president of the company's entertainment and devices division, and Moore's boss, in a statement yesterday.

Moore said his decision to leave Microsoft was largely driven by a desire to return to San Francisco, where he grew up. "I couldn't be more excited about joining EA and moving my family back to the San Francisco Bay area," Moore said in a statement issued by EA.

"I think you have to take it at face value," said Matt Rosoff, an analyst at Kirkland, Wash.-based Directions on Microsoft. "It looks like this move was in the works for some time."

According to a filing by EA to the U.S. Securities and Exchange Commission (SEC), Moore was offered the new job June 5, a month before Microsoft divulged the high Xbox 360 failure rate. In the offer letter, Moore's $550,000 annual salary was spelled out, as was a $1.5 million signing bonus and an option to buy up to 350,000 shares of EA stock. Microsoft, however, has acknowledged that it knew of the Xbox 360 problems for several months before unveiling the new warranty program and its associated charge.

"I don't think [Moore's resignation] had anything to do with the warranty extension," Rosoff said. "His group didn't have any control over the hardware design of the Xbox 360." Two weeks ago, Bach cited unspecified design, not manufacturing, problems as the root cause of the console failures.

Moore will be replaced by Don Mattrick, 43, a former president at EA who has been working as an adviser to Microsoft for the past several months. "Don is well known and respected throughout the industry for his deep knowledge, technical expertise and management savvy," Bach said.