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Forums - Gaming Discussion - MS CFO Tim Stuart defends throwing MTX into $70 games.

https://seekingalpha.com/article/4388809-microsoft-corporation-msft-management-presents-jefferies-interactive-entertainment-virtual?part=single

Tim Stuart

"Yes. I think we're not making specific announcements on first-party pricing yet. So we'll do that sort of in due time. But again, if -- I think if publishers can find a price point that works for their audience, defines a price point that works for the maximization of, I'll say users and revenue, because you want to drive engagement. I talk about engagement equals currency a lot. Engagement is the ability for you to drive wholesale monetization, to drive activation of your content, to drive sort of hours in your service. Because these games are becoming, as we all know, they're becoming ecosystems under their own -- or onto their own. Call of Duty wants to keep a Call of Duty player and monetize them down the road. FIFA wants to keep a FIFA player in their ecosystem and monetize down the road.

So I think we'll look at publishers to make the right decision for their content. If they can drive a premium price point or a higher price point, I think that's warranted. And I'd say, your point is exactly right. Prices have not gone up in -- what, for a couple of generations now, so it's not unheard of to see things like this going on.

And to the point earlier, content creation costs go up. And these publishers and content creators, including ourselves, want to make sure you're driving the right gross margin profiles, the right earnings profiles of what it takes to build these new, awesome, amazing games. And you want to make sure you have a good top line to support that."

Wow. I'm kind of blown away by how non-chalantly he talks about "driving engagement, and revenue". Allow me to translate this corpo-speak into normal human words...

Stuart: Yes. I think we're not making specific announcements on first-party pricing yet.


Translation: We haven't announced it yet, but we're going to ask for $70 for all of our MS first party titles. 

Stuart: But again, if -- I think if publishers can find a price point that works for their audience, defines a price point that works for the maximization of, I'll say users and revenue, because you want to drive engagement. I talk about engagement equals currency a lot. Engagement is the ability for you to drive wholesale monetization, to drive activation of your content, to drive sort of hours in your service.

Translation: Whatever price point gets the most users, while also getting the most money up front is the best price point. Because you want people hooked on a single game forever. If they are hooked on a single game forever, they will spend all of their money on the microtransactions. So we have to find a nice balance between charging as much as we possibly can for the initial game without lowering the userbase. That way we can design all our games to be grindy messes, and then offer MTX as the solution. This will maximize profits!

Stuart: Because these games are becoming, as we all know, they're becoming ecosystems under their own -- or onto their own. Call of Duty wants to keep a Call of Duty player and monetize them down the road. FIFA wants to keep a FIFA player in their ecosystem and monetize down the road.


Translation
: EA and Activision have found a way to sell people digital goods that costs next to nothing for them to produce, and they are making a killing off it. Let's face it. All games will eventually become this. And as a corporate shill I really like that idea! Good for them!

Stuart:So I think we'll look at publishers to make the right decision for their content. If they can drive a premium price point or a higher price point, I think that's warranted. And I'd say, your point is exactly right. Prices have not gone up in -- what, for a couple of generations now, so it's not unheard of to see things like this going on.And to the point earlier, content creation costs go up. And these publishers and content creators, including ourselves, want to make sure you're driving the right gross margin profiles, the right earnings profiles of what it takes to build these new, awesome, amazing games. And you want to make sure you have a good top line to support that."

Translation: These games cost a bunch of money to make. So much so that we need to charge as much as humanly possible, while still having MTX in our games, or else we'll go bankrupt! Not really, but I'm going to lie to you about that because I want to swim in money like Scrooge McDuck!



Last edited by Cerebralbore101 - on 17 November 2020

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Thank God for Gamepass. I'll pay $10 a month if I'm interested in playing their MTX infested nonsense, but I'm not paying a full $70 for something with MTX tossed into it.



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Ah damn.......those comparisons to CoD and FIFA really drove that nail into the coffin



I know Sony is guilty of throwing MTX into their games too, such as one of their racing games, and TLoU remastered. But the vast majority of Sony games have been completely free of MTX. I expect Halo Infinite to be a full $70 and have MTX in it to boot. It'll probably be the last new Halo game, and 343 will probably just keep adding on new DLC content to it forever. Kind of like how Destiny 1 and 2 got a billion expansions that made the initial game obsolete.



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That is very pro-consumer....Now being less sarcastic. If a game can keep you interested in it for a full year so you won't buy 5 games, it isn't unreasonable to receive more than a single full purchase price from it. The problem is the lack of transparency and the dirty way they do it. If they come out and charge 200 or 300 for the game and you think it is fair sure go and buy, If they launch expansions or meaningful DLC for 30 bucks and you like it sure buy it... now to make the game obnoxiously grind to sell acceleration packs is shitty practice, worse imho than cosmetic overpriced DLC that even though we can argue is low cost and should be on the game already you don't really need to buy or get in the way of your enjoyment.Will wait to see how Phil Spencer or his advocates rephrase this interview.



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

Azzanation: "PS5 wouldn't sold out at launch without scalpers."

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DonFerrari said:
That is very pro-consumer....Now being less sarcastic. If a game can keep you interested in it for a full year so you won't buy 5 games, it isn't unreasonable to receive more than a single full purchase price from it. The problem is the lack of transparency and the dirty way they do it. If they come out and charge 200 or 300 for the game and you think it is fair sure go and buy, If they launch expansions or meaningful DLC for 30 bucks and you like it sure buy it... now to make the game obnoxiously grind to sell acceleration packs is shitty practice, worse imho than cosmetic overpriced DLC that even though we can argue is low cost and should be on the game already you don't really need to buy or get in the way of your enjoyment.Will wait to see how Phil Spencer or his advocates rephrase this interview.

The idea that getting somebody to play a game for 300 hours, must have meant that the devs put in a ton of work, and therefore need extra money in return doesn't always hold true.

It doesn't take that much for a game to keep somebody interested for a full year. They just need to design the game in order to make it compelling, instead of fun. Take the +100 score you get for killing somebody in a CoD game. That +100 that pops up is a little piece of reward for your brain. It trains your brain to keep going back to CoD, whether you truly enjoy CoD or not. When you find yourself going back to a game over and over again, even though said game makes you rage, that is a sign of addiction.

But yeah, the way that they try to confuse the consumer with season passes, MTX, and 5 different "Digital Deluxe Editions" of a game is even worse, like you say. I don't think the $70 price of games is justified, but I'd take that if it meant no more content carving, and no more MTX. I'd take the $70 price tag if it meant we went back to good meaningful DLC ala Fallout's Broken Steel Expansion, or Witcher 3's DLC. Or Torna.

BTW, I do absolutely love how people try to defend cosmetic MTX as "Who cares, it's just cosmetic!" The number of free cosmetic customization options in GoW, Spiderman, and GoT is unmatched. Having different costumes to find in a game has been a staple of the industry for years. And it was all free. Now they are trying to charge you for those formerly free costumes. And the kicker is that all it takes is a dude working for $30 an hour for 4-5 hours to make a new skin or costume. And in exchange for that roughly $150 investment the company gets to sell thousands of copies of that skin for $2-$5. They could sell these skins for a nickle a pop, and still make boatloads of money. Charging $2-$5 for this cosmetic crap is just pure greed no matter the way you slice it.



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Cerebralbore101 said:
DonFerrari said:
That is very pro-consumer....Now being less sarcastic. If a game can keep you interested in it for a full year so you won't buy 5 games, it isn't unreasonable to receive more than a single full purchase price from it. The problem is the lack of transparency and the dirty way they do it. If they come out and charge 200 or 300 for the game and you think it is fair sure go and buy, If they launch expansions or meaningful DLC for 30 bucks and you like it sure buy it... now to make the game obnoxiously grind to sell acceleration packs is shitty practice, worse imho than cosmetic overpriced DLC that even though we can argue is low cost and should be on the game already you don't really need to buy or get in the way of your enjoyment.Will wait to see how Phil Spencer or his advocates rephrase this interview.

The idea that getting somebody to play a game for 300 hours, must have meant that the devs put in a ton of work, and therefore need extra money in return doesn't always hold true.

Agree with you. My point isn't that they need or even deserve, but that it is reasonable that they try to make more money if they can keep you satisfied for longer, but that it need to be done in a good way (which almost never is).

It doesn't take that much for a game to keep somebody interested for a full year. They just need to design the game in order to make it compelling, instead of fun. Take the +100 score you get for killing somebody in a CoD game. That +100 that pops up is a little piece of reward for your brain. It trains your brain to keep going back to CoD, whether you truly enjoy CoD or not. When you find yourself going back to a game over and over again, even though said game makes you rage, that is a sign of addiction.

Agree with it, for the good or for the bad I tire fast of this type of thing.

But yeah, the way that they try to confuse the consumer with season passes, MTX, and 5 different "Digital Deluxe Editions" of a game is even worse, like you say. I don't think the $70 price of games is justified, but I'd take that if it meant no more content carving, and no more MTX. I'd take the $70 price tag if it meant we went back to good meaningful DLC ala Fallout's Broken Steel Expansion, or Witcher 3's DLC. Or Torna.

True, but yes we all know that isn't what is going to happen.

BTW, I do absolutely love how people try to defend cosmetic MTX as "Who cares, it's just cosmetic!" The number of free cosmetic customization options in GoW, Spiderman, and GoT is unmatched. Having different costumes to find in a game has been a staple of the industry for years. And it was all free. Now they are trying to charge you for those formerly free costumes. And the kicker is that all it takes is a dude working for $30 an hour for 4-5 hours to make a new skin or costume. And in exchange for that roughly $150 investment the company gets to sell thousands of copies of that skin for $2-$5. They could sell these skins for a nickle a pop, and still make boatloads of money. Charging $2-$5 for this cosmetic crap is just pure greed no matter the way you slice it.

Yes they are, can't disagree. On the other hand being egoist I do prefer companies make their money like that and keep my game cheap and dropping in price faster since will be other people paying for it than asking price of the game rise or the time to pricecut becomes much longer.



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

Azzanation: "PS5 wouldn't sold out at launch without scalpers."

Is he the new Adam Ortho? Tim can get fucked. Not excuse for MTX EVER.



Bite my shiny metal cockpit!

Leynos said:
Is he the new Adam Ortho? Tim can get fucked. Not excuse for MTX EVER.

Unless it is a f2p gatcha that doesn't become p2w.



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

Azzanation: "PS5 wouldn't sold out at launch without scalpers."

Cerebralbore101 said:
I know Sony is guilty of throwing MTX into their games too, such as one of their racing games, and TLoU remastered. But the vast majority of Sony games have been completely free of MTX. I expect Halo Infinite to be a full $70 and have MTX in it to boot. It'll probably be the last new Halo game, and 343 will probably just keep adding on new DLC content to it forever. Kind of like how Destiny 1 and 2 got a billion expansions that made the initial game obsolete.

I believe the multiplayer is free to play. Of course there will be MTX, it will be like COD:Warzone.