Microsoft Feared The XBLA Would Destroy "Console Industry"

"There was a legitimate fear that Xbox Live Arcade was going to completely destroy the console industry."

Even though the Xbox Live Arcade become an incredibly-successful platform for Microsoft, it wasn't initially welcomed with open arms. There was an internal fear at the company during the early days of Xbox that the XBLA  would be the end of the console business.

XBLA creator Greg Canessa spoke to IGN, and revealed that many at Microsoft "didn't understand" that Xbox Live Arcade offered different types of gaming experiences, and as such, wasn't a threat to the console industry.

"There was a legitimate fear that Xbox Live Arcade was going to cannibalize retail sales and completely destroy the console industry," Canessa said on the latest episode of IGN Unfiltered. "That was actually a quote I got from one of the internal folks."

The company was afraid that "five and ten-dollar price points" would ultimately "destroy the economic model of console retail publishing and destroy the industry."