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How many subscribers does MS need for other companies to follow?

20 million 6 13.33%
 
30 million 4 8.89%
 
40 million 6 13.33%
 
50 million 13 28.89%
 
60 million 2 4.44%
 
70 million 1 2.22%
 
80 million 0 0%
 
90 million 1 2.22%
 
150 million + 12 26.67%
 
Total:45
LudicrousSpeed said:

😂😂😂 what games cost $200,000,000 to make

Halo will probably be the first game to launch on the service having cost $200,000,000+ to develop. And remember my $5 estimate was extremely conservative, and the games still sell outside of the service and at retail. GamePass subs aren’t the only way to recoup dev costs.

That 6 million only covers 85K sold copies. (Sure there are costs to selling games, yet there are also costs to hosting the service). Good for small games maybe, but just a drop in the bucket for big games.

It's not about whether gamepass is the only way to recoup dev costs, it's about whether it adds or substracts from total game revenue, once the model reaches sustainability. Unless suddenly a lot more people are getting into console/pc gaming, it's just reshuffling the pie with subscriptions services taking an extra cut of the pie. I know there is this dream that suddenly everyone is going to play 'big games' on their phone via the cloud, but I just don't see that happening.

Existing gamers might be interested to continue their games on the go, yet most people on mobile just want something simple to keep their thumbs busy while waiting for the bus or whatever. And there the expectations are free to play, not pay $10 a month. But maybe when bundled with phone contracts it could get some people hooked.



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Kyuu said:
konnichiwa said:

You argument is basically history repeating intself.

Around 10 Years ago we saw a similar thing when Sony announced PS plus for 50$ a year and get on average 2 games free a month!! (around 20 a year).

Why did sony do it?  With 50$ or 2.5$ a game they must lose so much money especially when I got a year subscription for 30$ a year and they also will have ps plus sales that makes games cheaper.....Are they that deperate? Why would I buy any games on PS3?  I don't have that much time and I am already lucky if I can finish the Just cause 2 free ps plus game in a month.


I mean we have now the Epic game store that gives free games to everyone and don't ask any subscription money.. how much are they losing?

We have Amazon prime that is releative cheap considering the perks (10$ cuts on pre orders) and honestly a nice selection of free games each month:




"And no, Sony's version doesn't count as it doesn't include all first party, modern releases."

The models you're talking about and the one Dulfite is envisioning and being hinted by Game Pass aren't the same thing. Adding in a bunch of old games that a few people are buying at 30% of their launch prices, or a small percentage of AA/AAA games day and date, is perfectly fine and sustainable for a giant like Microsoft. But the more new games they add, the less financial sense it'll make. This fact is already given away by Game Pass costing way more than Playstation Plus. You don't need profits and revenue breakdowns to know that much.

Some conspiracy theorists are already talking about Sony "paying publishers to keep games off Game Pass" as though publishers are dying to put them there. That's not what's going on.

We don't yet have enough information to know the exact implications of Game Pass. Hopefully Microsoft will stop shying out in sharing their gaming division data to give us a real sense of what's happening. Most sales trackers no longer sharing sales splits is complicating things as well.

You are missing the point, when PS plus launched it was great for consumers and stupid for Sony because it would only lose money in the end I doubt their are many left who think it is/was stupid. This are literally similar things that are said about gamepass/Epic game store etc. The scale is just different.



Isn't the bolded part exactly the reason why you are here in the first place?  You are just one of those guys who in the past would say that publishers and devs just make exclusives for PS4/PS5 and sony is not paying them to not release on other systems. Meanwhile you got proven wrong when we clearly can see the contracts made with bethasda and Sony so you move your goal posts to 'Sony does not try to get devs/publishers away from gamepass'....







Fun fact i use the gamepass discount to buy games



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SvennoJ said:
LudicrousSpeed said:

😂😂😂 what games cost $200,000,000 to make

Halo will probably be the first game to launch on the service having cost $200,000,000+ to develop. And remember my $5 estimate was extremely conservative, and the games still sell outside of the service and at retail. GamePass subs aren’t the only way to recoup dev costs.

That 6 million only covers 85K sold copies. (Sure there are costs to selling games, yet there are also costs to hosting the service). Good for small games maybe, but just a drop in the bucket for big games.

It's not about whether gamepass is the only way to recoup dev costs, it's about whether it adds or substracts from total game revenue, once the model reaches sustainability. Unless suddenly a lot more people are getting into console/pc gaming, it's just reshuffling the pie with subscriptions services taking an extra cut of the pie. I know there is this dream that suddenly everyone is going to play 'big games' on their phone via the cloud, but I just don't see that happening.

Existing gamers might be interested to continue their games on the go, yet most people on mobile just want something simple to keep their thumbs busy while waiting for the bus or whatever. And there the expectations are free to play, not pay $10 a month. But maybe when bundled with phone contracts it could get some people hooked.

$6,000,000 per game is an estimate based on my purely guessed number of $5 per month from every GamePass subscriber. It also assumes every game gets paid the same amount of money (they don’t). Your 85k sales assumes every game in the service costs $70 when a vast majority of games don’t cost that much. Hell, a large chunk of GamePass games probably don’t cost half of that. It also assumes publishers get every penny of that assumed $70 price, which is of course ridiculous.

All that will matter for publishers is if the checks they get from MS and revenue from GamePass players offset the initial cost of entry a user typically has to pay, which of course they now don’t have to pay because the game is in GamePass.



gtotheunit91 said:
src said:

Playstation makes $26B a year. Tiil Xbox comes anywhere close (it hasn't, in fact Sony predicts they'll take more marketshare this gen), Sony won't care. Neither will Nintendo.

Gamepass craters software sales. Its unclear if it is even profitable. To be profitable it essentially turns every game in F2P (+ sub cost), where the microtransaction spend by total users has to be greater than the sales revenue they would get by spending $60 to buy the game.

For SP games, that have very little to no MTX, they are subsidised by the MTX revenue of multiplayer games.

I think total PSN revenue is nearing $10B, so pubs from PS alone are getting $30B+ in revenue a year. Good luck trying to achieve that with Gamepass.

Why should you care? Why should anyone on this site care about how much money each of these companies make? I'm too busy playing more games than I can ever play for $15/month :) 

Seriously though, Microsoft is a $2 TRILLION company, whereas Sony is worth $140 billion and Nintendo is worth around $64 billion. Microsoft will always make more money than the competition. The gaming division of Sony takes up a HUGE part of their revenue, whereas it's all of Nintendo's revenue. They are both completely dependent on the business model gaming has been for decades now. If either of these companies gaming divisions start to falter, alarms will be going off. 

Microsoft is playing the long game on this because they can afford to. It'll be years and years before Game Pass starts making them a good amount of money. Microsoft is a service-based company, and they're incorporating the Xbox ecosystem into the business model that made them the powerhouse they are today.

Netflix didn't start making an insane amount of money and subscribers until they started investing into their own original content, and that's what Microsoft is doing. As long as Microsoft sees subscriber numbers and revenue continue to increase year over year, which it has been, they couldn't care less about losses. All they care about is getting Game Pass into as many people eyes and hands as possible. And that's working. What other gaming company can you play on Console, PC, mobile, web browser, and soon Smart TV? And all you need to transfer save data is by logging into your account. How much more consumer friendly can you get? 

Look at Epic Games. They've invested $500 million so far into the Epic Games Store on PC, and they're estimating it won't become profitable until 2027!!!!! 

So why doesn't everyone just go back to enjoying all of our favorite hobby, GAMING! We'll let the companies fight over our business. 

See, its people/consumers like you that allow capitalist companies to abuse laws, job security, workers rights and attempt to carve society to their will.

Unlike you, there are regulators, government agencies, academics, business analysts that do attempt to find out the ethics of businesses and their models. Consumers, unless they wish to be tools, are increasingly aware of the consequences of certain business models.

MS is such a 2 Trillion company that Xbox got dominated by Playstation and Nintendo 3 times out of 4 LMAO. Xbox fans love to throw around MS's marketcap like its some be all end all, when it just shows their lack of business acumen.

MS got to where it is by platform economics that even the US government considered anti-competitive: Windows. IE, Bing, Office, and now Azure all try and use their Windows monopoly to become popular products. It worked for a while and still does (Teams vs slack) but MS learnt the hardway that Windows is not as big as it was in the 80s. It got handily beaten many times by Apple, Google, Sony, Valve, Amazon, Zoom etc

Windows gaming got destroyed by Steam. There is little hope Windows gaming store can in anyway compete with Steam so MS uses Steam as well.

Epic thinks by burning money with timed exclusives they will compete, but it turns out their store lacks many ways what Steam has, and Valve has some great exclusives of their own. Epic's best push is Fortnite, a game that has been in massive decline since 2018 and is mostly played on console.

Xbox got dominated by Playstation, especially in the business model of being a platform holder. Sony have beaten MS by 120:50 in hardware and now get near 70% of all third party sales.

Being dominated both on the PC and console side, Xbox is now going to service subs, as way to form its own dominant platform. There are numerous reasons why the gaming industry and business model is bad for the sub model but I will put it simply.

Netflix, Spotify, Disney+ are very open in their growth. They give quarterly sometimes even monthly updates on sub count, sub types, and a ton of other data to clearly show growth.

Spotify's revenue grew 10 times in 4 years. Netflix had an exponential increase in revenue.

Gamepass is nothing like Spotify or Netflix.



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LudicrousSpeed said:
SvennoJ said:

That 6 million only covers 85K sold copies. (Sure there are costs to selling games, yet there are also costs to hosting the service). Good for small games maybe, but just a drop in the bucket for big games.

It's not about whether gamepass is the only way to recoup dev costs, it's about whether it adds or substracts from total game revenue, once the model reaches sustainability. Unless suddenly a lot more people are getting into console/pc gaming, it's just reshuffling the pie with subscriptions services taking an extra cut of the pie. I know there is this dream that suddenly everyone is going to play 'big games' on their phone via the cloud, but I just don't see that happening.

Existing gamers might be interested to continue their games on the go, yet most people on mobile just want something simple to keep their thumbs busy while waiting for the bus or whatever. And there the expectations are free to play, not pay $10 a month. But maybe when bundled with phone contracts it could get some people hooked.

$6,000,000 per game is an estimate based on my purely guessed number of $5 per month from every GamePass subscriber. It also assumes every game gets paid the same amount of money (they don’t). Your 85k sales assumes every game in the service costs $70 when a vast majority of games don’t cost that much. Hell, a large chunk of GamePass games probably don’t cost half of that. It also assumes publishers get every penny of that assumed $70 price, which is of course ridiculous.

All that will matter for publishers is if the checks they get from MS and revenue from GamePass players offset the initial cost of entry a user typically has to pay, which of course they now don’t have to pay because the game is in GamePass.

You're just concentrating on the math of an example grabbed out of thin air. What matters is the second and third paragraph of my reply.

If the total size of the pie stays the same, subscriptions services just take an extra cut from the pie. Same as the $10 publishing fee to put games on consoles. With first party games that fee doesn't earn the platform holder anything extra, yet via a subscription service, it is a way to get more money for the platform holder.

So if the pie doesn't grow, the development budgets shrink with this added revenue stream (for the platform holder).



src said:
gtotheunit91 said:

Why should you care? Why should anyone on this site care about how much money each of these companies make? I'm too busy playing more games than I can ever play for $15/month :) 

Seriously though, Microsoft is a $2 TRILLION company, whereas Sony is worth $140 billion and Nintendo is worth around $64 billion. Microsoft will always make more money than the competition. The gaming division of Sony takes up a HUGE part of their revenue, whereas it's all of Nintendo's revenue. They are both completely dependent on the business model gaming has been for decades now. If either of these companies gaming divisions start to falter, alarms will be going off. 

Microsoft is playing the long game on this because they can afford to. It'll be years and years before Game Pass starts making them a good amount of money. Microsoft is a service-based company, and they're incorporating the Xbox ecosystem into the business model that made them the powerhouse they are today.

Netflix didn't start making an insane amount of money and subscribers until they started investing into their own original content, and that's what Microsoft is doing. As long as Microsoft sees subscriber numbers and revenue continue to increase year over year, which it has been, they couldn't care less about losses. All they care about is getting Game Pass into as many people eyes and hands as possible. And that's working. What other gaming company can you play on Console, PC, mobile, web browser, and soon Smart TV? And all you need to transfer save data is by logging into your account. How much more consumer friendly can you get? 

Look at Epic Games. They've invested $500 million so far into the Epic Games Store on PC, and they're estimating it won't become profitable until 2027!!!!! 

So why doesn't everyone just go back to enjoying all of our favorite hobby, GAMING! We'll let the companies fight over our business. 

See, its people/consumers like you that allow capitalist companies to abuse laws, job security, workers rights and attempt to carve society to their will.

Unlike you, there are regulators, government agencies, academics, business analysts that do attempt to find out the ethics of businesses and their models. Consumers, unless they wish to be tools, are increasingly aware of the consequences of certain business models.

MS is such a 2 Trillion company that Xbox got dominated by Playstation and Nintendo 3 times out of 4 LMAO. Xbox fans love to throw around MS's marketcap like its some be all end all, when it just shows their lack of business acumen.

MS got to where it is by platform economics that even the US government considered anti-competitive: Windows. IE, Bing, Office, and now Azure all try and use their Windows monopoly to become popular products. It worked for a while and still does (Teams vs slack) but MS learnt the hardway that Windows is not as big as it was in the 80s. It got handily beaten many times by Apple, Google, Sony, Valve, Amazon, Zoom etc

Windows gaming got destroyed by Steam. There is little hope Windows gaming store can in anyway compete with Steam so MS uses Steam as well.

Epic thinks by burning money with timed exclusives they will compete, but it turns out their store lacks many ways what Steam has, and Valve has some great exclusives of their own. Epic's best push is Fortnite, a game that has been in massive decline since 2018 and is mostly played on console.

Xbox got dominated by Playstation, especially in the business model of being a platform holder. Sony have beaten MS by 120:50 in hardware and now get near 70% of all third party sales.

Being dominated both on the PC and console side, Xbox is now going to service subs, as way to form its own dominant platform. There are numerous reasons why the gaming industry and business model is bad for the sub model but I will put it simply.

Netflix, Spotify, Disney+ are very open in their growth. They give quarterly sometimes even monthly updates on sub count, sub types, and a ton of other data to clearly show growth.

Spotify's revenue grew 10 times in 4 years. Netflix had an exponential increase in revenue.

Gamepass is nothing like Spotify or Netflix.

Interesting graph. In 2019 Netflix had avg 150 million subscribers, at 20K revenue, about $133 per year per subscriber or $11 a month on average. I think we can all agree that hosting game streaming and developing games costs more on average than hosting video streaming. Netflix plans range from $9.99 to $18.99 for 4K.

Until game subscription services make more revenue than video streaming platforms, I don't see how it can be sustainable. Netflix prices have more than doubled since release. I started on a $6 a month plan, currently have the middle tier (HD more screens) that costs more than double as a paid at the start. Mean while a lot of content has disappeared to competing services, replaced with original content that's hit and miss, and mostly lower budget stuff.



If the pie isn’t growing, publishers won’t continue to add their games to the service. You don’t need a big increase in the gaming market in order for a service like GamePass to pay off, you only need your slice of the “pie” to grow. Which again, means what do pubs make selling their games on the Xbox or PC marketplace versus selling their games on the Xbox or PC marketplace AND getting GamePass money.

The risk for publishers is gamers who might have paid for your game will now just get it on GamePass. The reward can be a lot of people who normally wouldn’t buy the game, play it and then buy it. Or play it and you get engagement via various forms of monetization.



And the 'risk' to gamers is more monetization and trickled content to keep engagement going. Just as mobile 'free to pay' games are more grind oriented with daily tasks to keep you in their grip. So while you get access to more games, each game will try harder to keep you in their hands to get more money out of you. It's a bit of a contradiction, more games, yet all want more of your time to recoup their costs. Time is finite as well.



SvennoJ said:

And the 'risk' to gamers is more monetization and trickled content to keep engagement going. Just as mobile 'free to pay' games are more grind oriented with daily tasks to keep you in their grip. So while you get access to more games, each game will try harder to keep you in their hands to get more money out of you. It's a bit of a contradiction, more games, yet all want more of your time to recoup their costs. Time is finite as well.

What the literal hell are you talking about dude? lol you clearly have never tried Game Pass if this is how you think it works. I've been a subscriber for a little over a year now, and all I ever play are single player games. You make it sound as if every game on the service is a live-service game with monetization. There's a few for sure like Sea of Thieves, ESO, Marvel's Avengers, or most of EA's games, but most of the games on the service are single player games, which is also what most of Microsoft's first-party studios are working on now btw.

You're just looking for a justification for your thoughts on a service it doesn't sound like you've even tried. 

The true value of Game Pass isn't just the library of great games, it's also all the not so great games that you avoid purchasing and regretting later. 

There are so many games I was interested in buying, but when I tried it on GP, I quickly was glad I didn't outright purchase it. But I also finally was able to play games I've been wanting to, but just never got around to it like the Dishonored series, Wolfenstein series, Alien Isolation, The Outer Worlds, Control, Prey, DOOM Eternal, Greedfall, and Hades. These are just games I've been able to finish this year and they're all single player games. I don't get into live service games exactly for the reasons you laid out, but that doesn't make up most of the games on the service.