Did you know that video games get more expensive to make every year, hundreds of people overwork for years to get those games out, if videogame companies can’t make profit they will cut budgets and their resources, if you enjoy high quality games you better be more supportive towards the people making those games, or else in the long run most games will end up looking and playing like forntnite.

That's all well and good. But this is the quality of quantity argument all over again.

Some dev costs of games you know:

1. GTA5 $137M
2. GOW $44M
3. HZD $47M
4. Shadow of the Tomb Raider $75M

I really could keep going. This information is all out there for all that want to see it. And all those prices are before you tack on the marketing costs. Which in some cases actually costs more than what it costs to make the darn things.Eg.GTA5 with marketing costs over $260M. Yu can tack on another $30 - $40million at least for every AAA game marketing cost to the list above.

The simple fact is, it does cost around $80M - $120Mon average to make AAA games these days. And those posts will go up a bit next-gen as they always do.

Why is this important? This is exactly why you will not see those kinda games on Gamepass on day 1. You may see them there eventually when the game is considered to be at the end of its term, but not in the first 12 months.

And this is a simple math problem, MS simply cannot afford the cost of admission to have these kind games be on their service on launch day. Take COD for instance. This is a game that across all platforms sells at least 15M copies in its first 6 months on the market. That's $900M of revenue in just under months. Not including extras like limited editions and all MTX. For MS to secure games like those, they would have to pay out well over $500M. And that just for that year, and just that one game. Then spread this out to say 4 or 5 other such games in a year. Now granted not all of them is COD, so they may get away with paying "only" like $350M for others. We are talking billions a year just to secure the titles that are coming to the platform that year.

And why do they pay that you ask? Well just take you for instance, if you know you c get COD, Cyberpunk...etc on day one on GP, would you still go out and buy them for $70? Would anyone? Hell, if MS announces tomorrow they have games like cyberpunk the next GTA, AC, COD...etc on their service I would cancer my PS5 pre-order in a heartbeat.

It's just not sustainable. Not for anyone that knows they can move the games direct to consumers at full price. Ever wondered why FIFA (or at least the latest one) isn't on GP?

Look up the dev cost of any AAA title. Then tack on another $25M - $50M for marketing costs, which are not included in those development costs. Have any idea how much an ad spot in the Superbowl cost? $5.6M... for 30 seconds. 

But here is another way to factor in dev costs.

Let take a AAA studio for instance. That has only 100 people working on a game ( a lot less than hat we know work on these games, but lets just go with this). Now these people get an average salary of $130k. Let's just keep it simple and leave it at that, because while there would be some getting more and some getting less, there are also lots of contract-based people that work on the game that come and go. Like the QA testers, actors, a music composer...etc that I am not factoring in. So this is a best-case scenario type thing.

That team working on a game for 3 years would cost $39M to fund. And for 4 years? $52M. And this s before you add in equipment, research costs, outsourcing costs, rent, electricity, localization, legal..etc. And at this point, you haven't even factored in marketing either.

I think a lot of people grossly underestimate how much most of these games cot to make. There is a reason why there are companies in south America,China, korea...etc that singularly specialize in outsourced asset development. Or why Sony has studios whose singular purpose is to build assets to help out any of their name studios when making games.

Microsoft them self said they are still losing money and said it's gambling. 

Well why not just tell that to Nintendo 

I would like to add two things, one is game pass loses money Phil himself said game pass costs money and those costs will increase overtime but are sustainable, increasing numbers on the platform rather than profit was always the aim with game pass, so in a nutshell gamepass is a strategy designed to stop any further shrinkage of the player base,now game pass going forward may change that in the future depending on how the next gen goes, another point to take into account is those AAA games subsidise other game development according to Shuey around 7 games per AAA hit.

I sincerely don't get why the whole gamepass thing causes such conflict over here. Like to me, it's super straightforward.

1. Game pas is a subscription service. You pay a monthly fee and get access to all you can play.
2. Now like with every subscription service, it will live and die on the content it has.
3. Thre are to ways to get that content, make them yourself and/or buy it from someone else.
4. Buying from someone else will cost you the equivalent (or at least very close to) what said someone else expects to have sold if they sold directly to the customer. Aka, it would be very expensive, we are talking hundreds of millions into billions type expensive.

So basically, rather than take $100M and make a game, you would be spending $350M+ to just ensure a major third party game comes to your service day one. And failure to do that will mean that people don thave a lasting reason to come or stay on your service. And this is in addition to having your own games on there. Now even if you make an average of 2 AAA games a year, what stops someone from just signing up for one month, ($10) and play al the games you made that year? Absolutely nothing.

So what do you do to ensure continuous engagement? You break your game up. Serialize the hell outta it or make them GAAS. Tha way you give people reasons to keep coming back or to stay. The alternative, is that you stop making big-budget games, and instead make smaller indie like games. Basically, you stop making $70 games and start making $10 games. 

The single-biggest thing here is, no one..not a single third party publisher will put their digest money makers on gamepass day 1. Not that they couldn't but that it would b flat out stupid forMS to try and afford them. Its simply better for MS to spend $100M on original content than to spends $400M+ just to secure one third party game. nd as long as all themaor third party games release directly to the consumer first, then gamepass will forever be an afterthought and will not grow. You will end up with a situation where you have a lot of people that use the service, but only buy-in for a month or two a year and just binge play like 5 - 8 games in that month. 

The gaming model isn't one that leans itself to a subscription model.It just isn't. And thats not just from the business side of things, even the consumer... gamers, will abuse it.

We live in a world that's driven by money and debt and we care less for tomorrow than we do for today. This is why I don't like the idea of the gamepass as the risk it poses to gaming is greater than the reward.

Netflix loses money. It burns through money at a faster speed than it makes money. They make money from subscribers as well as merch through some of their bigger brands, and now have begun to release some of their big movies for a limited cinema release to help get into the black faster.

Deliveroo also loses money. Big money and both these services are good to carry on as stopping would mean no money at all.

E. G. The grift / con of borrowing money and paying back until its such a large amount you can no longer say no so you just keep going.

This is why netflix can do this, this is why Deliveroo can afford what their doing and keep making losses in the billions.

Like the recession caused by the global housing market and debts which grew, it is all set up to eventually fall and its dangerous. MS can afford it as it can eat up the costs via their other bigger revenue streams, but Sony can't.

Then you look at the output from the two and the budgets invested and its a no contest. Sonys output is hell off a lot higher and the budgets seem higher too. The argument that remake costs less than the original is absurd. It takes more man hours to make a game from ground up for next gen than it did for a game from last gen. There is more tech needed, there engine costs as they won't use the engine from the ps3 era.

Sony has said for years now and reiterated that the profits from big games allow them to invest in smaller niche games where they make losses.

I have been gaming since 1988 and its something I will continue to do until I am physically unable to. The risk MS is taking in gaming could destroy my hobby and our the quality of games I get. MS has proven time and time again, that they won't invest in quality big budget games the way sony does. For three generations they have proved this.

If you look at the rest of their services, the users is to create and maintain a serviceable subscription providing the basics.

The new office 365 and Teams is essentially a copy of Google Drive, folders hangouts. It costs stupid amount of money and it don't work all that great. However, you gotta pay as they're aren't many alternatives where you get end to end user support and rollout guidance that can meet most service level agreements.

I prefer the safer Sony approach where they offer the games on disc and hopefully they can bring the game onto psnow or ps plus collections in a year. You get both options and the risk of losing it all is massively reduced. As Jim says, their method is sustainable.

i think its a given,
of course u will wait a couple of years before they release 1st party games on ps now or pc port lol!

If people can't see for themselves the difference between games that need to be developed with a subscription model in mind and therefore need to think of other ways to monetize (i.e. microtransactions, smaller budget, online multiplayer focus and so on) and Sony's exclusives I don't think discussing in a forum is going to make them change their mind. They just lack basic understanding on the revenue stream and cost structure associated with game production.