| the-pi-guy said: |
I know he's formerly PR of Xbox but I don't buy his argument Tbh. Hi-Fi Rush with or without Game Pass would have underperformed, it flopped on PlayStation and Steam too, where Game Pass doesn't exist. Redfall can't be attributed to Game Pass at all. He's right that Game Pass has stagnated but Game Pass is still profitable on its own.
I'm about 90% sure it's wrong to say Xbox has to "make back" that $70bn and not how M&S work, Microsoft did not lose $70bn but converted it into an asset, but the integration costs of Activision are taking money from Xbox but still, the logic that every company has to instantly make back the money they spent on M&A's has never been true, Microsoft acquired Linkedin for over $20bn but you don't see Linkedin having to make back that money.
What's more important is does that asset bring in more money than interest on $70bn.
Blaming Game Pass is the easy thing but it doesn't make sense Imo and it's just people looking for something to blame when the actual reality is that Activision-Blizzard is a company with a 30-40% profit margin, XGS and Bethesda aren't. Microsoft has already publicly said they want MS Gaming profit margins at similar levels to other Microsoft's businesses which are 20%+ so this is the result, they likely saw how Activision-Blizzard operates and thought "Why the hell aren't we doing this in XGS/Bethesda?" or to put it simple, basically Activision acquired Xbox.
The reality is that Game Pass saved Xbox but didn't grow to its Microsoft's desired heights, if it did grow to say, 80m subscribers then maybe things would be different but companies like Microsoft are always looking for infinite growth and they won't throw money at a business forever, Xbox is now around the levels of Windows but with way worse profit margins, Microsoft wants them up, Game Pass not existing wouldn't change that (not to mention the vast majority of people don't even use Game Pass on PC).
Last edited by Ryuu96 - on 09 May 2024
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