Xbox Chief Don Mattrick Leaving Microsoft To Become Zynga's New CEO, Starting July 8

Zynga Founder Mark Pincus will continue to serve as Chief Product Officer and Chairman of the Board of Directors. Mattrick had hoped for a bigger role at Microsoft. Now his move comes just as he is wrapping up the controversial unveil of Xbox One.

Don Mattrick has been named the new CEO of Zynga.

Last month, as part of several weeks’ reporting of a future Fast Company feature about Mattrick and his role as the president of interactive entertainment at Microsoft and the company’s Xbox czar, I asked Mattrick directly about his future at Microsoft. There have been rumors for some time that he might leave, possibly to return to EA, where he spent nearly 15 years. And at E3, word spread that he was planning on moving to the Bay area for the summer (he lives in Vancouver). He answered in typical, exec-ese, but hinted that he was waiting to hear how the coming reorganization at Microsoft was going to shake out. “I kinda feel like I've been blessed to have this experience with this team,” he told me over breakfast one morning at a sleek hotel in downtown Los Angeles. “We’re set up for a great next decade of growth so that's exciting. Microsoft has a whole new set of challenges in front of it and we're just gonna wait and see what gets announced inside the company.”

Mattrick’s departure from Microsoft now seems obvious. He never completely fit in at Microsoft, where he was more of a creative, product guy than a software nerd, more likely to pal around with Steven Spielberg than geek out about Bill Gates. Even members of his own team marveled at his longevity at the company. “I wouldn’t say Microsoft has the strongest track record of external talent, at least at the senior level, in keeping them,” Phil Spencer, head of Microsoft Studios, told me. “Look at the number of external executives that came into the company, lasted for a little while, sometimes a very little while, and then spun out for some reason. Don has been remarkable in that way, in being somebody who’s come in at a senior level and actually moved up in the company.”

Until today.

Published reports at AllThingsD indicated that Mattrick’s leap to Zynga was unrelated to the massive reorganization that Microsoft is set to announce on Wednesday. My sources inside the company directly contradict that, saying that Mattrick, who since arriving at Microsoft in 2007 dramatically turned Xbox into a money-making business and was the chief visionary behind the new Xbox One, had been hoping for a bigger role at Microsoft. Instead, there were discussions about him overseeing the newly created hardware division, which was effectively a demotion. He said, No thanks, according to a source.

Mattrick’s move comes just as he is wrapping up the controversial unveil of Xbox One. Following a “reveal” event in May that gamers complained focused more on Xbox One’s entertainment features than on games, last month’s E3 spurred more drama. Gamers (including troops overseas) flew into a rage when it was announced that Xbox One required Internet connectivity and had a restricted policy on used games, leading Microsoft to awkwardly backed down on both those policies in a blog penned by Mattrick.

The bad press spurred by E3--TechCrunch branded Microsoft an “asshole”; and Sony, which rolled-out a cheaper, more gamer-friendly Playstation, was declared the event’s hands-down winner--is said to have upset Microsoft CEO Steve Ballmer, who couldn’t have been pleased about those unhappy troops. “Microsoft is a huge supplier to the U.S. government, especially the Army,” said one former Microsoft executive. “You don’t want to piss off the biggest customer for Office, Windows, Exchange--run the list.”

Indeed, some wonder if Mattrick wasn’t forced to back down on Xbox One because of his boss.

“Don doesn’t change his mind because his decision was unpopular,” said one person who has worked with Mattrick. “If Don is a Greek hero, his flaw is hubris. His whole career has been built on having a position and holding it, even when people tell him he’s not right.”

Having spent the last several weeks interviewing Mattrick and people close to him, this statement rings true. A self-made video game mogul, who collects exotic cars and flies to work in Redmond via a private jet, Mattrick championed the motion sensor technology Kinect even when naysayers at Microsoft said the technology was way too premature. It went on to become the fastest-selling consumer electronics device in history when it launched in 2010. And he aggressively broadened Xbox’s reach by making early deals with Netflix, ESPN, and YouTube.

In a blog post to employees today, Zynga CEO Mark Pincus, who will become chief product officer and chairman of the board of directors, emphasized that he recruited Mattrick. "I’ve always said to Bing and our Board that if I could find someone who could do a better job as our CEO I’d do all I could to recruit and bring that person in. I’m confident that Don is that leader," Pincus wrote, adding later in the post, "Don is unique in the game business. He can execute in multiple domains--hardware, software, and network, and he’s been the person responsible for game franchises like Need for Speed, FIFA, and The Sims. He’s one of the top executives in the overall entertainment business and he’s a great coach who has inspired people to do their best work and build strong, productive teams."

In a letter to Microsoft employees, CEO Steve Ballmer congratulated Mattrick and called his next job a "great opportunity." He went on to contextualize gaming and Microsoft's gaming consoles as part of the company's overall strategy. "I’m particularly excited about how Xbox pushes forward our devices and services transformation by bringing together the best of Microsoft," Ballmer wrote. "The consoles are incredible all-in-one devices with built-in services that consumers love, including Bing, Xbox Live, Internet Explorer, SkyDrive and Skype. And, just as important, Xbox Games, Xbox Video, Xbox Music and SmartGlass light up Windows PCs, tablets and phones."

And he ended his note with appreciation: "Thank you, Don, for setting us on a path to completely redefine the entertainment industry. The strong leadership team at IEB and their teams are well positioned to deliver the next-generation entertainment console, as well as transformative entertainment experiences, long into the future."

Read more about Mattrick and what he means for Zynga on Tuesday.

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2 Comments

  • tim cotter

    let face it xbox 360 was raised up to its pinnacle by gamers then the money grabbers moved in and are running it into ground the new dashboards especially latest to make it metro have slowly alienated gamers, as has getting rid of things like inside xbox. for a while it looked like Microsoft actually 'got it' about the whole gaming/gamers world view but once it was established they've slowly turned it into a cashcow and milk it to death. ive played xbox and xbox360 but when my gold account comes up for its yearly renewal I will be killing it off. I see what Microsoft have planned for the future of xbox and quite frankly it sucks, unless you are a sports mad couch potato