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How Would You Improve Playstation Plus on the PS5?

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DonFerrari said:
EricHiggin said:

So if online wasn't free on PS3 and you had to pay $25 for a basic package, how many would have paid that, and how many wouldn't have purchased a PS3 because of it? How many would have gone ahead and paid $60 anyway for the higher tier package while they were at it? Plus was also brand new product for PS. It's not often something brand new takes off immediately and see's no changes as it grows yet inevitably slowly stagnates. You need to charge more, or offer more choice, which typically means a cheaper choice at the very least.

Probably around 30-50M would have paid 25 for MP if Sony put it behind a paywall, similar to how it would be today. People didn't stop purchasing X360 even with a double the price XBL for online so I don't see many not purchasing PS3 because of the half priced online. Probably same 1-2M would pay 50 for the PS+ with games, that is already historical data.

You already pointed out it's one third of the existing user base. I simply didn't increase it because like I said, I wanted to be conservative. I don't see what's wrong with thinking way way more people will choose the cheaper base package over the higher tiers. That's what you've been saying. I'm just assuming a cheaper base package would push more people over the edge, who wouldn't be otherwise, to buy into Plus.

Sure more people would chose the cheaper alternative on PS+, but that wouldn't make it double the sales of the cheaper and 6x the more expensive compared to PS3.

How many played PS3 online that weren't paying anything? How many would have paid $25 back then if they were forced to? How do you know it wouldn't double? If you look at many high selling games, after they've only sold a couple million copies give or take, the price has been getting cut in half and then it goes on to sell double or triple or more. Why couldn't this work for Plus?

Which game have you followed that released for half price for double sale? CoD have launched for similar prices whole gen and sales were naturally increasing, it wouldn't double because of price cut. Also most of the sales of the games happen on the first couple months, they don't double after the price cut (or triple). I'm yet to see you provide a single evidence to your assumptions.

We're basically assuming everything. Just because we have some general numbers to go off of doesn't guarantee anything. Did XB 360 numbers guarantee XB1 success? Did the changes to the XB1 ecosystem cause the problems it had? What about PS3 to PS4? Did the positive changes to PS4, like a lower, more reasonable, affordable price lead to it's success? Would cheaper online have made it even more successful?

If you don't have any evidence better than historical data you go with historical data.

Well you said people don't typically budget for gaming, so why couldn't they decide to take 3 or 4 years of online savings, plus non gaming related savings over that time period, and use them to purchase a PS product they may not have otherwise? If they only have a gaming budget, which you have to take into account will have money added to the pool each year, not just from the savings from online, it could be put into many different things. PSVR was just one possibility, considering it's going to get cheaper as time goes on.

Again if they saved money by paying less on PS+ and used that money to buy another PS product that would just mean Sony had to do more to get the same revenue (so more cost and less profit).

The biggest reasons were that there was little reason at the time not to charge for online, or to charge less. With how poorly the PS3 gen went, charging the same price as XB Live made a tonne of sense at the time. It was becoming the norm, it helped to cover the crappy PS3 gen, PS4 was cheap enough that even with $50 going to online it was still $50 cheaper then the competition without paying for Live, and it helped tie or even lock to some degree many people into the PS4 ecosystem and PS brand in general.

X1 was 100 more than PS4 and that didn't made MS do XBL online free or anything of the sort.

Who was forcing PS to sell PS4 for $399? They could have sold it for the same price as XB1 and it still would have outsold it. Not nearly in the same manner as they did with the lower price, but regardless. PS could certainly have gotten away with less first party titles, maybe not lesser quality titles though. PS is doing this to bring more people into the ecosystem. They likely kept Plus at the same price as XB though because they assumed that was one of the things MS wasn't likely to budge on. That would make it even easier for PS to gain online market share now because Live is unlikely to follow a Plus reduced package as XB is headed in a more service based direction than PS.

PS4 launching at 499 would probably sell much slower, sure it would still outsell X1 not sure the point in it. But just look at historical data and current gen data and instead of 100M PS4 would probably be 60-70M at this point.

If you want to bring people in who won't come easily for whatever reason, it means more work and options. If you don't bring them in, it means either charging more to your existing customers or stagnating. Both of these are more likely to keep those harder to get consumers away, while also losing some of your existing customers. There is a balance though.

Here you are right, but offering MP by half price wouldn't improve profits as I put the numbers so no point in working more to get the same or less

Last gen PS3 sold 87M units, and PS4 has already sold 100M and is likely going to end up selling 20M-30M more than that. So out of those 10M extra players right now, none of them are buying into Plus? What if there were different tiers? What about the other 10M-20M or more in the future? Will PS5 sell less, the same, or more units?

In April 2003 XB Live had 350,000 users. In April 2004 XB Live was now at 750,000 users. In July 2005 Live had 2M users. E3 2007 Live had 7M users. March 2008 10M users. Jan 2009 17M users. Today it has 64M. I don't see why PS offering different options and packages couldn't lead to a significant increase in users.

Not games that released for half price, games that dropped to half price which increased or kept sales going so instead of the game stagnating or fading away, it continues on. Whether it be PS first party or third party, it's a way to keep bringing people in. If you look at Ubisoft for example, games like AC Origins or R6 Siege came down in price fairly quickly which kept sales going and increased overall sales by a considerable amount. I myself wouldn't have bought Origins at $80, but I did for $40 like a month after the launch, and it's led me to spend more money on all the DLC. The basic Plus package wouldn't be a new launch really, it would be an additional offering to an existing service, just a more affordable one. Like how you can buy Origins or Siege in different editions for different prices.

I agree you should use historical data to guide you to a certain degree, but unless the historical data and what it's tied to match up exactly with what you're comparing it to, you have to interpret how things may differ now. The PS3 gen compared to the PS4 gen is very different, also taking into account the competition.

When PS gives games away with PS Plus, those games aren't free for them. Even if they give their own first party games away that's some lost profit. One way or another PS has to work for your dollar. They don't profit 100%.

MS had bigger problems, and like I said, they are heading for a service based platform and have been before it became obviously apparent more recently, so the last thing they want to budge on is online pricing. That's their gravy train. PS isn't focused and relying on that so much.

Correct, and your point is that PS/SNY aren't going to do more work, especially for less or the same money. Why sell 30% more consoles for 20% less when they could sell 30% less for 20% more? Market share and mind share. The opportunity to get you into the ecosystem and possibly lock you into it with everything else they offer.

If your numbers are right then yes it would be worse. How do you know for certainty that would be the case though? Even if it ended up so that PS made the exact same amount of money in the end, what's wrong with that if they can please more consumers while getting them into their ecosystem?



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With cattle farts, we view sea rise,
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EricHiggin said:
DonFerrari said:

Last gen PS3 sold 87M units, and PS4 has already sold 100M and is likely going to end up selling 20M-30M more than that. So out of those 10M extra players right now, none of them are buying into Plus? What if there were different tiers? What about the other 10M-20M or more in the future? Will PS5 sell less, the same, or more units?

Not sure why you want so much what if scenarios. I expect similar 40% attach ratio, so when PS4 get to 130M HW sold I would imagine 50-55M PS+ subs. Not sure what you are talking on these extra 10M buying Plus, sure some of them do, just look at the PS+ subs announced by Sony it have been growing with HW sold (but not at the same attach ratio, as probably late buyers are the ones that are very cost restricted).

Analysis must be done ceteris paribus. You move one variable and talk about the effect of that one, do it for each of they and then make the harmonization of all of them. Trying to change 3-4 variables at once will only make your analysis confusing.

In April 2003 XB Live had 350,000 users. In April 2004 XB Live was now at 750,000 users. In July 2005 Live had 2M users. E3 2007 Live had 7M users. March 2008 10M users. Jan 2009 17M users. Today it has 64M. I don't see why PS offering different options and packages couldn't lead to a significant increase in users.

XBL Gold doesn't have 64M users. You can bet it have like 70% of what X360 had. The XBL subs MS announced way back were total XBL (Gold, Silver and included PC). XBL gold is less than half of PS+, so likely 15M or so, which would be lower than 2009 numbers you are giving.

Not games that released for half price, games that dropped to half price which increased or kept sales going so instead of the game stagnating or fading away, it continues on. Whether it be PS first party or third party, it's a way to keep bringing people in. If you look at Ubisoft for example, games like AC Origins or R6 Siege came down in price fairly quickly which kept sales going and increased overall sales by a considerable amount. I myself wouldn't have bought Origins at $80, but I did for $40 like a month after the launch, and it's led me to spend more money on all the DLC. The basic Plus package wouldn't be a new launch really, it would be an additional offering to an existing service, just a more affordable one. Like how you can buy Origins or Siege in different editions for different prices.

Yes sure that the pricecuts increased the sales, but they didn't double after cutting to half (and again even if they did, not much value in selling the double for half the money anyway). Games launch for 60, so 80 would be some collector edition, and yes when price drops more people buy (most of the non first party I buy under 20). Those probably would give 25-30% more sales to the game. But again as I said most of the sales happen before the pricecut. And if your logic of PS+ by half price would do the magic you think developers would already release the game at 30 pricepoint (and perhaps include more DLC, special packs, etc).

I agree you should use historical data to guide you to a certain degree, but unless the historical data and what it's tied to match up exactly with what you're comparing it to, you have to interpret how things may differ now. The PS3 gen compared to the PS4 gen is very different, also taking into account the competition.

Sure thing market change. But unless your reason and explanation for straying far from the historical data is backed by strong evidence or analysis it isn't much likely to happen (just like someone that said on the alternate history that if Wii were a HD competitor to PS3 and X360 it would still come in front of everyone).

When PS gives games away with PS Plus, those games aren't free for them. Even if they give their own first party games away that's some lost profit. One way or another PS has to work for your dollar. They don't profit 100%.

I know, and you want to make it even less profitable by offering MP for half the price and they earning less than on the 50-60 subs.

MS had bigger problems, and like I said, they are heading for a service based platform and have been before it became obviously apparent more recently, so the last thing they want to budge on is online pricing. That's their gravy train. PS isn't focused and relying on that so much.

If they are relying on the online money more than Sony, than they have even more incentive to find a pricepoint that would bring more subs (with higher profit in the end of course). So you defeated your own point here.

Correct, and your point is that PS/SNY aren't going to do more work, especially for less or the same money. Why sell 30% more consoles for 20% less when they could sell 30% less for 20% more? Market share and mind share. The opportunity to get you into the ecosystem and possibly lock you into it with everything else they offer.

Nope. If your projection isn't more profit then you won't do it. Why don't Sony cut the price of PS4 to 199 1 or even 2 years ago? Because the additional sales of HW, that would bring more SW and subs together, wouldn't make they profit more than what they decided (at least on their projection). It is as simple as that.

If your numbers are right then yes it would be worse. How do you know for certainty that would be the case though? Even if it ended up so that PS made the exact same amount of money in the end, what's wrong with that if they can please more consumers while getting them into their ecosystem?

For me as customer there is nothing wrong with they charging less and bringing more people. But as company to earn less money isn't a good strategy.

We can't have certainty, but since I'm basing on historical data I believe my projection would be more probable than yours.

If you had gone with something like 40 for PS MP, 55 PS MP+games and 70 on the PSNow I would agree there would be possibility of more profit based on the anchoring tatic that makes the higher priced one more interesting because customer will think "for just 10 more I get free games" some would still buy the 40, but the 55 or even the 70 would increase sales compared to today. Lets say that instead of 50M subs PS+ may achieve this gen it go to 60-70M next gen with average ticket a little above today.



duduspace11 "Well, since we are estimating costs, Pokemon Red/Blue did cost Nintendo about $50m to make back in 1996"

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DonFerrari said:

EricHiggin said:

Last gen PS3 sold 87M units, and PS4 has already sold 100M and is likely going to end up selling 20M-30M more than that. So out of those 10M extra players right now, none of them are buying into Plus? What if there were different tiers? What about the other 10M-20M or more in the future? Will PS5 sell less, the same, or more units?

Not sure why you want so much what if scenarios. I expect similar 40% attach ratio, so when PS4 get to 130M HW sold I would imagine 50-55M PS+ subs. Not sure what you are talking on these extra 10M buying Plus, sure some of them do, just look at the PS+ subs announced by Sony it have been growing with HW sold (but not at the same attach ratio, as probably late buyers are the ones that are very cost restricted).

Analysis must be done ceteris paribus. You move one variable and talk about the effect of that one, do it for each of they and then make the harmonization of all of them. Trying to change 3-4 variables at once will only make your analysis confusing.

In April 2003 XB Live had 350,000 users. In April 2004 XB Live was now at 750,000 users. In July 2005 Live had 2M users. E3 2007 Live had 7M users. March 2008 10M users. Jan 2009 17M users. Today it has 64M. I don't see why PS offering different options and packages couldn't lead to a significant increase in users.

XBL Gold doesn't have 64M users. You can bet it have like 70% of what X360 had. The XBL subs MS announced way back were total XBL (Gold, Silver and included PC). XBL gold is less than half of PS+, so likely 15M or so, which would be lower than 2009 numbers you are giving.

Not games that released for half price, games that dropped to half price which increased or kept sales going so instead of the game stagnating or fading away, it continues on. Whether it be PS first party or third party, it's a way to keep bringing people in. If you look at Ubisoft for example, games like AC Origins or R6 Siege came down in price fairly quickly which kept sales going and increased overall sales by a considerable amount. I myself wouldn't have bought Origins at $80, but I did for $40 like a month after the launch, and it's led me to spend more money on all the DLC. The basic Plus package wouldn't be a new launch really, it would be an additional offering to an existing service, just a more affordable one. Like how you can buy Origins or Siege in different editions for different prices.

Yes sure that the pricecuts increased the sales, but they didn't double after cutting to half (and again even if they did, not much value in selling the double for half the money anyway). Games launch for 60, so 80 would be some collector edition, and yes when price drops more people buy (most of the non first party I buy under 20). Those probably would give 25-30% more sales to the game. But again as I said most of the sales happen before the pricecut. And if your logic of PS+ by half price would do the magic you think developers would already release the game at 30 pricepoint (and perhaps include more DLC, special packs, etc).

I agree you should use historical data to guide you to a certain degree, but unless the historical data and what it's tied to match up exactly with what you're comparing it to, you have to interpret how things may differ now. The PS3 gen compared to the PS4 gen is very different, also taking into account the competition.

Sure thing market change. But unless your reason and explanation for straying far from the historical data is backed by strong evidence or analysis it isn't much likely to happen (just like someone that said on the alternate history that if Wii were a HD competitor to PS3 and X360 it would still come in front of everyone).

When PS gives games away with PS Plus, those games aren't free for them. Even if they give their own first party games away that's some lost profit. One way or another PS has to work for your dollar. They don't profit 100%.

I know, and you want to make it even less profitable by offering MP for half the price and they earning less than on the 50-60 subs.

MS had bigger problems, and like I said, they are heading for a service based platform and have been before it became obviously apparent more recently, so the last thing they want to budge on is online pricing. That's their gravy train. PS isn't focused and relying on that so much.

If they are relying on the online money more than Sony, than they have even more incentive to find a pricepoint that would bring more subs (with higher profit in the end of course). So you defeated your own point here.

Correct, and your point is that PS/SNY aren't going to do more work, especially for less or the same money. Why sell 30% more consoles for 20% less when they could sell 30% less for 20% more? Market share and mind share. The opportunity to get you into the ecosystem and possibly lock you into it with everything else they offer.

Nope. If your projection isn't more profit then you won't do it. Why don't Sony cut the price of PS4 to 199 1 or even 2 years ago? Because the additional sales of HW, that would bring more SW and subs together, wouldn't make they profit more than what they decided (at least on their projection). It is as simple as that.

If your numbers are right then yes it would be worse. How do you know for certainty that would be the case though? Even if it ended up so that PS made the exact same amount of money in the end, what's wrong with that if they can please more consumers while getting them into their ecosystem?

For me as customer there is nothing wrong with they charging less and bringing more people. But as company to earn less money isn't a good strategy.

We can't have certainty, but since I'm basing on historical data I believe my projection would be more probable than yours.

If you had gone with something like 40 for PS MP, 55 PS MP+games and 70 on the PSNow I would agree there would be possibility of more profit based on the anchoring tatic that makes the higher priced one more interesting because customer will think "for just 10 more I get free games" some would still buy the 40, but the 55 or even the 70 would increase sales compared to today. Lets say that instead of 50M subs PS+ may achieve this gen it go to 60-70M next gen with average ticket a little above today.

What if, is where this all started, so not sure why you replied in the first place if you didn't want to join the what if game. You explained why PS4 wouldn't get as many users as I suggested they may, using PS3 as historical evidence, but that's not an apples to apples comparison. If PS4 sells many more consoles, it should end up with more subs, which you basically answer yourself right after.

Just because I may not agree with your Latin tongue scientific analysis of what if, doesn't mean I'm just moving on and turning a blind eye to what's already been brought up. I just don't agree in some cases and it doesn't seem like you or I were going to budge. Some of the conversation movement was initiated by yourself.

I missed that 64M was just active users. You're correct. I can't find much other than a few posts elsewhere that say last they heard it was around 17M-18M, but those posts were a few years ago, so where it stands now is anybody's guess since MS isn't being clear about many things. If we're going to use the last known official numbers, then XB1 has sold way less units than we assume it has.

Well you don't give anything away for cheaper than you have to at the start. You get what you can from who you can. Once you've grown a user base and have more control over the market, then you offer more options to keep growing. This would be one of the reasons to offer a cheaper package.

You mean if I don't stick strongly to historical evidence like you then we are unlikely to agree? Well I think it's pretty clear that I don't think the historical evidence in this case is near as useful as you think it is based on the hypothetical scenario.

You said they would have to do more work which they won't do. Getting people to pay $50 for 2-6 games, depending on the time period, along with offering them big deals on digital items, is less work then getting people to pay $25 without any games or deals? Why did they do more work then on the existing package?

Again, you're not taking into account what needs to be for this to make sense. XB is in a position right now where even if they cut their Live price in half, it's highly unlikely it's going to bring in many people because of their position based on PR. Instead, they've offered new separate services and offered deals there to get people on board. The money is still coming in, just from a different service. PS could do this as well instead of Plus tiers if they wanted to. There's nothing they have to do, I just didn't offer it as a suggestion earlier.

Well how much they were making off the hardware is questionable a couple years ago, and they need to make money, but like I said before, you don't offer anything for less than you can get for it based on your situation. That changes over time though and you end up forced to make it cheaper or you have to offer something else or charge more for what you already have.

Companies do want to maximize profit, but they can't ignore the competition. Many companies have fallen and some gone bankrupt because they took their customers for granted. It's give and take, and it's a balancing act, you just need to know what moves to make and when to move them to keep the scales even. Sometimes you have to be more generous, other times you can be more greedy.

The prices don't have to be exactly what I said they were, but the cheaper the base price, the more people who will be influenced to join, but again, it's a balancing act. There will be a point where it doesn't matter how much cheaper you make it, people just won't flock to it unless you go all in and make it free, and so you obviously don't want to go below that tipping point. If that point is closer to $40, then that's where it needs to be, if that's the case. Is it though?

Last edited by EricHiggin - on 23 August 2019

The Canadian National Anthem According To Justin Trudeau

 

Oh planet Earth! The home of native lands, 
True social law, in all of us demand.
With cattle farts, we view sea rise,
Our North sinking slowly.
From far and snide, oh planet Earth, 
Our healthcare is yours free!
Science save our land, harnessing the breeze,
Oh planet Earth, smoke weed and ferment yeast.
Oh planet Earth, ell gee bee queue and tee.

EricHiggin said:
DonFerrari said:

What if, is where this all started, so not sure why you replied in the first place if you didn't want to join the what if game. You explained why PS4 wouldn't get as many users as I suggested they may, using PS3 as historical evidence, but that's not an apples to apples comparison. If PS4 sells many more consoles, it should end up with more subs, which you basically answer yourself right after.

There are what ifs that are based on market laws and historical data and there are those based on wishful thinking. And the very high numbers were closer to the second.

Just because I may not agree with your Latin tongue scientific analysis of what if, doesn't mean I'm just moving on and turning a blind eye to what's already been brought up. I just don't agree in some cases and it doesn't seem like you or I were going to budge. Some of the conversation movement was initiated by yourself.

I missed that 64M was just active users. You're correct. I can't find much other than a few posts elsewhere that say last they heard it was around 17M-18M, but those posts were a few years ago, so where it stands now is anybody's guess since MS isn't being clear about many things. If we're going to use the last known official numbers, then XB1 has sold way less units than we assume it has.

Yep I do think X1 XBL Gold may be near 20M (and that would be on a half userbase of X360)

Well you don't give anything away for cheaper than you have to at the start. You get what you can from who you can. Once you've grown a user base and have more control over the market, then you offer more options to keep growing. This would be one of the reasons to offer a cheaper package.

This is perfectly fine reasoning.

You mean if I don't stick strongly to historical evidence like you then we are unlikely to agree? Well I think it's pretty clear that I don't think the historical evidence in this case is near as useful as you think it is based on the hypothetical scenario.

Not exactly. Like when you deviate from historical evidence you need to make a strong case to defend the what if. And yes it is hard to do and be plausible or worse, probable.

You said they would have to do more work which they won't do. Getting people to pay $50 for 2-6 games, depending on the time period, along with offering them big deals on digital items, is less work then getting people to pay $25 without any games or deals? Why did they do more work then on the existing package?

Sorry not sure I understand your point here. Having to sell more things for the same dollar is more cost and work, if your point was anything else please clarify.

Again, you're not taking into account what needs to be for this to make sense. XB is in a position right now where even if they cut their Live price in half, it's highly unlikely it's going to bring in many people because of their position based on PR. Instead, they've offered new separate services and offered deals there to get people on board. The money is still coming in, just from a different service. PS could do this as well instead of Plus tiers if they wanted to. There's nothing they have to do, I just didn't offer it as a suggestion earlier.

Nope, I'm taking in account that they could offer the XBL gold for cheaper on PC and would increase their userbase as well. Similar to what they are doing on the gamepass that is just starting (when it matures the price will likely increase).

Well how much they were making off the hardware is questionable a couple years ago, and they need to make money, but like I said before, you don't offer anything for less than you can get for it based on your situation. That changes over time though and you end up forced to make it cheaper or you have to offer something else or charge more for what you already have.

Seems like you agree with me that you don't charge less unless forced to or expect that to bring more profits overall. Like if your post was on the side that perhaps charging for 40 the PSN (MP and discounts, instead of two tiers) would bring more subs to PS+ and the constant discounts on the service would generate more sales and in the end of the day more profits due to more people being tied to the service (but that wouldn't increase the revenue on subs itself).

Companies do want to maximize profit, but they can't ignore the competition. Many companies have fallen and some gone bankrupt because they took their customers for granted. It's give and take, and it's a balancing act, you just need to know what moves to make and when to move them to keep the scales even. Sometimes you have to be more generous, other times you can be more greedy.

Maximizing profits necessarily needs to do market analysis and competitors.

The prices don't have to be exactly what I said they were, but the cheaper the base price, the more people who will be influenced to join, but again, it's a balancing act. There will be a point where it doesn't matter how much cheaper you make it, people just won't flock to it unless you go all in and make it free, and so you obviously don't want to go below that tipping point. If that point is closer to $40, then that's where it needs to be, if that's the case. Is it though?

On this point I totally agree. The best pricepoint may not even be the current one, although I expect Sony to have done the right analysis to decide it, but my main gripe is the lower tier having the most relevant service that make people sign the service. If you had put 25 for the discounts (but would be hard to justify the free games with it, and perhaps it could offer free trial of MP a number of days in a year) and 50 for the MP and discount possibly I would have agreed.



duduspace11 "Well, since we are estimating costs, Pokemon Red/Blue did cost Nintendo about $50m to make back in 1996"

http://gamrconnect.vgchartz.com/post.php?id=8808363

Mr Puggsly: "Hehe, I said good profit. You said big profit. Frankly, not losing money is what I meant by good. Don't get hung up on semantics"

http://gamrconnect.vgchartz.com/post.php?id=9008994

An easy return policy would be nice. With Steam I have two weeks to get a full refund on any game that I've played less than 2 hours of, which has led to me trying out many games because of the low-risk involved in making a purchase.

To be honest, I'm not even sure what the PSN return policy is, but whatever it is, it hasn't been communicated to me well enough to make the assumption that I can safely buy a game that I may or may not want to keep until I've played.

Other than that, the massive discount given to full-year subs versus subbing for a single month at a time makes it unfavorable for consumers who don't use the service very much, which is the case for all subscription services. I don't see this changing anytime soon, but figured I would mention it since it's something that I've personally been bothered by.

I play mostly single player games, so I use the service primarily for discounts and free PSN titles, and overall I think it's a great service.



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I'd make sure it gave you 15% off all digital purchases.



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