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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
AkimboCurly 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.

If each PS plus subscriber is paying the full $60.00 a year, and there are 46 million PS plus subscribers year-round, that would make $2.7bn, not $10bn. That's the ballpark number you should be comparing Game Pass revenue to. 

In fact, the gross revenue number from PS Plus is $3.5 billion (presumably thanks to those who pay $9.99 monthly), compared with $13.8 billion for software and $7 billion in hardware, to make , as you say, $24.8 billion total sales revenue. These would be the more appropriate numbers to compare to MS's position.

But this is all fluff which is mostly besides the point. Companies will be enticed to either copy or not copy Microsoft's strategy based on net profits and expectations of future net profits. Specifically the present value of all future profits. Nintendo and Sony will presumably have their own estimates about what their net profits would be when either following suit or doubling down on their present strategies, based on how gamers continue to respond to GP and what kind of deals MS are able to start brokering for it. Gamepass is conceived as a disruptive product and has positioned itself as a great value offering on PC as well as console, makes it inherently unpredictable. But it's growing like a rocket, and that's in a market where paying for online multiplayer is becoming increasingly untenable. 

So the choice for Sony might be between emulating aspects of game pass or find themselves scrambling to find a subscription service they can pivot PS Plus users onto when that racket eventually runs out of track. It should go without saying though that for Sony, generating half of all PS revenue through software, will protect and grow that revenue as a priority notwithstanding some enormous strategic pressure. Such strategic pressure might, for instance, be a consumer base which is increasingly used to playing games at zero marginal cost. The idea of paying £70 for a new game now baffles me. I wouldn't be so sure as you are that Sony will stay the course as they're a very large and pragmatic corporation which has read the market very well in the past, but this is all change and don't underestimate it. 

Another thing is those god-awful graphs, man. Why would you compare Xbox to Prime, Netflix or Spotify. Surely you'd compare Prime, Netflix or Spotify to game pass itself rather than the whole Xbox division including hardware and conventional software sales? Especially when gamepass is quite obviously an exercise in shifting software sales revenue into subscription revenue. It's a super futile comparison. 

You are doing the wrong business model

Gamepass gives games for free. Third parties, retailers, all need money from games sales, so Xbox has to pay them out. Gamepass also discourages game sales

(increased MTX + sub count) - (third party cut - retailer cut - decreased software sales - first party dev budget - hardware budget)

PS makes $8.73B on software sales. They take a 30% cut so total revenue of game sales is approx $29B. We'll assume software ties are similar so Xbox makes $4.35B and total game rev is $14.5B

This is what Gamepass needs to eventually replace if it wants to have third parties put all their games day 1 and tank software sales.

At $120 for Xbox to have everything under GP that's 120M subs. For Playstation, which is twice the size of in many aspects, that's 240M subs.



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only777 said:

I feel that a video I made last month would actually fit in here very well.  I argue that PS Now is GamePass+XCloud.  The only difference is that Sony don't put out their games on day one on the service. 

But I argue that doing so doesn't make business sense.  The amount of money MS has to pour into GamePass to make it what it is will never make a profit.

As I say, apart from the day one thing, PS Now is the same thing.  You can download the games (you only HAVE to stream PS3 games), and the selection is really good.  Plus let me be really brutal and say that although MS do put their 1st party games on GamePass on day 1, they hardly have any 1st party games to begin with!

I decided to watch the video against my better judgment and there are so many things wrong. It speaks volumes that you actually haven't used Game Pass. From a value point of view there is way more going on with Game Pass than PSNow. Not only Day 1 releases of 1st party games, but almost half the games released on Game Pass during a month are day 1 3rd party titles. Then you say Xbox doesn't have any exclusives and compare Crackdown 3 to God of war lol. The console warring is strong in this video. You also get Perks with Game Pass(free content for certain games and other stuff like 3 months subs Spotify, etc), EA Play, game discounts, and just newer games in general like Scarlet Nexus. PSNow doesn't even put all their older exclusives on the service and their 1st party games don't even stay on the service indefinitely.

Then we get to the best part of this video where you decide to stop comparing PSNow to Game Pass due to day 1 releases, and flip it to Game Pass is not a sustainable business, which basically is your way of conceding that Game Pass is better lol. 

Come'on man. I know Sony fans want Playstation to always be the best in everything, but sometimes it's just not the case and the fact you made this video shows a bit of insecurity. I will say editing is solid and a well done video in general, but the console warring is not a good look, especially when you come across as salty towards Xbox. 

Last edited by smroadkill15 - on 03 October 2021

Xbox revenue YoY is up in the double digits. I don’t care much about your sources, I’m sure you’re spinning that, it’s more how horribly organized and ugly the graphs are.

Not to mention how in the world can you tell what the normalized growth of GamePass is when you have no idea how many subscribers there are, what they are paying, and what MS spends to acquire content.

If you took a look at what Netflix was spending early on to get the streaming service off the ground you would have thought they’d be out of business quickly.

Again, which console warrior forum did you find this at? Please tell me you got it off GameFAQS and didn’t make it yourself.



Why so many posts about Gamepass. And no one's talking about PS+, the largest monthly subscription powerhouse? Or PSN revenue from selling software which probably blows anyone out of the water.



Because xbox fans aren't insecure



 "I think people should define the word crap" - Kirby007

Join the Prediction League http://www.vgchartz.com/predictions

Instead of seeking to convince others, we can be open to changing our own minds, and seek out information that contradicts our own steadfast point of view. Maybe it’ll turn out that those who disagree with you actually have a solid grasp of the facts. There’s a slight possibility that, after all, you’re the one who’s wrong.

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src said:
LudicrousSpeed said:

Can you post your sources for the horribly sorted data in these graphs? Why does the Netflix graph show about 14-15 years when it has been around for almost 25? Why does the Xbox graph seem to stop at around 8 years when it’s been around for 20?

Also why are you expecting a service that has been around for four years to be as big as fucking Netflix 😂

What console warrior forum did you find these graphs at?

Aww is the reality of market data hurting your imagination?

Source of the numbers are from company FY reports. You can check the numbers yourself to verify, its all from there.

I think its apparent that you are in over your head with even the most basic financial analysis. Netflix started streaming in 2007.

Notice the word normalised. Gradients of Netflix, Spotify, Prime, even in their early years are evidently vastly different to Xbox.

smroadkill15 said:

Where did you find this, Twitter or Reddit? I really hope you didn't waste your time making this because it's terrible. 

Why? It clearly shows, Xbox's sub model isn't moving the needle, isn't growing like a successful sub service and most of all (which is why I suspect some are so taken back), Gamepass is not the Netflix of gaming lol

Netflix grew 10x in 10 years.

Lol what? It took 6 years for Netflix to reach the same sub numbers Game Pass was at in 4 years and it took year 8 for it to reach similar growth that it took for Game Pass in 4 years, so twice as long. Game Pass is still limited to Xbox consoles, PC, mobile, and tablets, compared to the number of platforms Netflix is available on now. Xcloud launched last week in Japan, Mexico, Australia, and Brazil with high demand in those regions. The number of regions will continue to grow and the amount of platforms will as well. 

Look, I found an graph that's readable. Take note. 



smroadkill15 said:
src said:

Aww is the reality of market data hurting your imagination?

Source of the numbers are from company FY reports. You can check the numbers yourself to verify, its all from there.

I think its apparent that you are in over your head with even the most basic financial analysis. Netflix started streaming in 2007.

Notice the word normalised. Gradients of Netflix, Spotify, Prime, even in their early years are evidently vastly different to Xbox.

smroadkill15 said:

Where did you find this, Twitter or Reddit? I really hope you didn't waste your time making this because it's terrible. 

Why? It clearly shows, Xbox's sub model isn't moving the needle, isn't growing like a successful sub service and most of all (which is why I suspect some are so taken back), Gamepass is not the Netflix of gaming lol

Netflix grew 10x in 10 years.

Lol what? It took 6 years for Netflix to reach the same sub numbers Game Pass was at in 4 years and it took year 8 for it to reach similar growth that it took for Game Pass in 4 years, so twice as long. Game Pass is still limited to Xbox consoles, PC, mobile, and tablets, compared to the number of platforms Netflix is available on now. Xcloud launched last week in Japan, Mexico, Australia, and Brazil with high demand in those regions. The number of regions will continue to grow and the amount of platforms will as well. 

Look, I found an graph that's readable. Take note. 

Erm it says in your own graph it took 6 years for Netflix to even go international, 4 years to come to XBox, 10 years to reach more of the world.
Besides that, the internet landscape was vastly different when Netflix started and streaming was still very new.
Starting in 2005 vs 2017, totally different.

You're just proving GP is lagging behind ;)



how do you mean? untill 2019 gamepass was locked on the xbox console userbase, how is that compareable with 4 billion internet users?



 "I think people should define the word crap" - Kirby007

Join the Prediction League http://www.vgchartz.com/predictions

Instead of seeking to convince others, we can be open to changing our own minds, and seek out information that contradicts our own steadfast point of view. Maybe it’ll turn out that those who disagree with you actually have a solid grasp of the facts. There’s a slight possibility that, after all, you’re the one who’s wrong.

2005 had 4 billion internet users able to stream video? There aren't even 4 billion people able to stream video now.

GP launched in a different landscape, one of pretty much always online consoles.



SvennoJ said:

2005 had 4 billion internet users able to stream video? There aren't even 4 billion people able to stream video now.

GP launched in a different landscape, one of pretty much always online consoles.

fine 1 billion vs 50 million



 "I think people should define the word crap" - Kirby007

Join the Prediction League http://www.vgchartz.com/predictions

Instead of seeking to convince others, we can be open to changing our own minds, and seek out information that contradicts our own steadfast point of view. Maybe it’ll turn out that those who disagree with you actually have a solid grasp of the facts. There’s a slight possibility that, after all, you’re the one who’s wrong.