Bill Gates Was "Insulted" By Xbox Pitch, Co-Creator Says

The Xbox brand today is a massive force that seemingly everyone knows about, even if they don't care about gaming. It wasn't always this well-known, however, or even appreciated by the leaders of the company that created it.

Xbox co-creator Ed Fries recently shared the story of the "Valentine's Day Massacre," which is the name for an ultra-important meeting where the fate of Xbox was decided years ago.

Speaking to IGN, Fries said there were two internal teams at Microsoft pitching Bill Gates and Steve Ballmer on the idea for a game console. The side Fries sided with wanted to create a box that had a hard disk and was basically "a PC in disguise." The other team's system was more akin to a traditional console that would be a "continuation of the Sega Dreamcast line."

Some original Xbox controller prototypes were inspired by the Dreamcast because, according to designer Seamus Blackley, Dreamcast was "king."

Gates ultimately sided with Fries' team, under the idea that the console would run some form of Windows, and they had a year to formulate a business plan about how it would all work. During the planning year, the team eventually decided to drop the Windows angle and instead create a more "closed" system that "runs games really well." This culminated in a meeting with Gates and Ballmer, which took place on Valentine's Day.

The rest of the story is best heard without interruption; here it is, as told by Fries and translated by NeoGAF:

"So we go into the meeting and four o'clock Valentine's Day--Bill walks in he's holding a Powerpoint deck and yells, 'This is the blanking insult to everything I've done at this company' and that was the start, so we all looked at [Xbox director and designer J Allard] because we knew Bill's mad about the no Windows thing, because we forgot to 'pre-disaster' him, so J is in shock for a minute and Bill yells at me and shuts me down and Robbie steps up and Bill shuts him down anyway, and then Ballmer goes through and says we're gonna lose a lot of money and he's beating us up about that, hours go by its five o clock, its six o clock, it's Valentines Day! Most of us have something going on!

"So we spent years working on this and looking at each other and convincing them this is the best plan, so finally one of the observers at the meeting just raises his hand and says, 'What about Sony?' and he says, 'Sony is slowly invading the living room with a processor here software there, they could be a threat to Microsoft.' So Bill and Steve stop and look at each other and go, 'Yeah...what about Sony?' And so Bill turns and says, 'I'm going to give you guys everything you want' and Ballmer repeats the same thing. And I turn to Robbie and say, 'That was the weirdest meeting I've ever been in.'"

The full interview contains lots of fascinating facts about the origins of Xbox. You can watch it here. Fries resigned from Microsoft in January 2004.