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Forums - Gaming Discussion - Phil Spencer: Sony buying third party games, all to do with money, not market share

arcane_chaos on 05 August 2015

*roll eyes* okay phil



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Intrinsic on 05 August 2015
LudicrousSpeed said:

1. Youre talking potential sales, Phillip is talking WW market share. They are not the same thing, nor are they as black and white as you make it seem to be. If MS makes a deal for a game that sells a bulk of its units in the US, why would that games publisher care about the Xbone getting crushed in Japan?

Please, you cant have "market share" without talking about relative install base. Being that one leads to the other. As far as market share is concerned, and as far as any publisher is concerned, the PS4 has a significant "market share" advantage. Which is primarily due to its install base advantage. If the game in question is one that does well only in US then yes, the market share considered will only be that of the US (kinda why publishers don't bother releasing games for the XB1 in Japan). But the games in question are games that do well globally. Not just in one territory. 

2. Even ignoring that common sense in point 1, there is still good reason for a publisher to take money from the smaller market. Its not going to affect sales of the PS4 version much, if at all, and it can increase the sales they'd see on Xbone, and they get monies from MS. Thats more common sense.

You really believe that a game releasing earlier on a less popular platform will not affect its sales later on on a more popular one? And do you think game publishers are running a charity?You are aware of fiscal earning reports right? 

This thread is a joke already though with all the insults, Im out

Its just unfortunate that they're actual people that would sip that MS spin coolaid no matter what. I don't even believe now install base and market share are very different things all of a sudden. 

Ah well, now I respect Phil more. He really does know his audience. apparently they will eat this shit right up. 



Risthel on 05 August 2015

So, is he saying that Microsoft doesn't have the money to buy third party exclusives but Sony has?
Oh, and nice fair play Phil, I hope people will start to realize you aren't a saint after all.



thismeintiel on 05 August 2015
Zekkyou said:
thismeintiel said:

Of course they do.  Why else would SE be kicking themselves in the ass over the TR deal.  I'm pretty sure this is the only time I have EVER heard of a company announcing when the exclusivity ends before the "exclusive" game has even launched.  And this isn't just a few days/weeks before launch, either, but over 3 months from the XBO release.

I don't think that's necessarily because SE are "kicking themselves". I'd assume, based on the fact the bolded is indeed somewhat rare, that it's something normally discussed in the initial deal. That SE were able to make such an announcement when they did would imply that they actively chose not to include a block against such things in the deal (or at least only a short term block). They were obviously happy enough with the deal when they made it, so i don't think that announcement has anything to do with their present feelings.

My guess would be that they knew they'd be upsetting a lot of people with the deal (PlayStation presently being the brand best associated with TR), so thought an early announcement of the deal's length might help negate some of the inevitable long-term negativity that would surround the game.

They made that deal a little over a year ago, when the gap was only 4M.  I'm sure they also saw the sales jump after MS dropped Kinect and dropped the price by $100.  And MS probably let them in on their ideas to make a comeback for the holidays, which worked short term.  However, I doubt they are happy about it now that that gap has grown by another 7M+ in just the time from the agreement.  I doubt MS paid them enough to cover that kind of gap.  I think that led to some renegotiations.



 

kitler53 on 05 August 2015

phil is right guys, just look at the facts:

1. ms has lots of money but is short on marketshare.

2. sony has lots of marketshare but is short on money

3. tomb raider is exclusive to xbox

4. sony only has marketing exclusives like destiny, CoD, star wars battle front, metal gear



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Normchacho on 05 August 2015

Some of the things said in this thread are insane...Of course market share factors in to exclusivity deals, how would they not?

Say your company is making a game, and is looking for it to be a third party exclusive. So you go to Sony and MS and they offer you $1 million and $1.1 million respectively, but! Going with Sony will likely net you 80% more sales, which one do you choose?



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binary solo on 05 August 2015
celador said:

Xbox boss Phil Spencer has said that market share has nothing to do with the third-party exclusive we are seeing on PS4, it's all about the money.

Speaking to GameSpot about third-party exclusives on PS4, Spencer said: "So, they don't "gobble" the deals up. They buy them. You know, I read the same things you do, and I know some people think it's somehow less expensive to sign third-party exclusives if you have a bigger market-share. I can tell you, it has nothing to do with market share."

He added: "When you go in to do a deal, with a third party, that third party has its own view of the global market and the value of it. And they should, they should think about their assets and how valuable they are, just like anyone would when they are selling their goods."

http://www.videogamer.com/xboxone/halo_5/news/sony_is_buying_third-party_exclusives_for_ps4_says_xbox_boss.html

This is double-speak. A publisher has a view of the short term and long term value of their product. Essentially, "how much of this can I sell". The first thing you need to know to answer that question is what is the size of your market? The maximum possible size of your market is the install base at the time you release the game plus the growth of the install base over the year or so after the game releases (when 80-90% of your game sales will occur, esp for an existing franchise). When you enter into exclusivity discussions then both parties will be looking at the value of the install base that remains and the value of the install base that will be excluded. If the install based that remains as the potential market is assessed as substantially larger than the install base being excluded then clearly what the benefactor has to pay to secure exclusivity will be based at least partly on this determination. Install base isn't the be all and end all, because each platform has games that sell well compared to their install base and sell not so well compared to their install base. So potential market needs to look deeper than just install base, but install base is a starting point.

There is no doubt whatsoever that install base is a factor that influences exclusivity negotiations. It's why MS had no hope of making RoTR permanent console exclusive, and why Sony was able to make SFV a permanent console exclusive. If Xb one and PS4 had even-ish market share I don't think SFV could have been made permanent console exclusive, even though SFV would still sell considerably more on PS4. The reason for that, is because perceived market value of Xb one would be higher, and hence the asking price for permanent console exclusivity would be more. 



“The fundamental cause of the trouble is that in the modern world the stupid are cocksure while the intelligent are full of doubt.” - Bertrand Russell

"When the power of love overcomes the love of power, the world will know peace."

Jimi Hendrix

 

binary solo on 05 August 2015
kitler53 said:
phil is right guys, just look at the facts:

1. ms has lots of money but is short on marketshare.

2. sony has lots of marketshare but is short on money

3. tomb raider is exclusive to xbox

4. sony only has marketing exclusives like destiny, CoD, star wars battle front, metal gear

I appreciate the effort, but if you are going to make a point by selectively listing facts you need to make sure the list only contains facts. Point 4 is not a fact unless you remove "only".



“The fundamental cause of the trouble is that in the modern world the stupid are cocksure while the intelligent are full of doubt.” - Bertrand Russell

"When the power of love overcomes the love of power, the world will know peace."

Jimi Hendrix

 

Burek on 05 August 2015

Guys, I think that there was an error in translation. What Spencer really said was: "Pout! Pout! We have very few 1st party games, and it's getting more difficult to get 3rd party exclusives. But we have hundreds of billions dollars more than Sony. So obviously it's not about money, it's about Sony's covert Ninja assassins."



Farsala on 05 August 2015

Sure Phil, go ahead and buy all those japan exclusives that Sony pays for. VVait do they pay for it?


MS PR at best.