Let's slow down for a sec here; we don't know if the figure leaked is just pure sub revenue or also includes MTX/DLC sales generated specifically through GP the service. I'm not able to find any specification on this, maybe someone else has it?
I mean it honestly could go either way, and considering the lower incentive for many Xbox owners to buy the games if they're in GP Day 1 (reflected through generally weaker NPD chart placings, for example), I can see it being reflective of sub revenue. Tho that doesn't add up to me; why offer all the cheaper incentives like $1 conversions, free trails etc. and so readily if the ARPU isn't that far off from an actual year's worth of GamePass?
Regardless of if it includes MTX/DLC, the fact remains that Microsoft makes a lot of revenue with Game Pass. Once they get to where 90% on the content is in-house, their expenses for getting outside games will be minimal. They offer $1 deals and all that because they just want to get the consumer into the subscription service and try it out. If they can get 1 out of 5 people who sign up for $1 deal to actually stay subscribed for $10 a month, that's a win for Microsoft because as time moves on, it will go from 1 out of 5 to 2 out of 5 and so forth.
Either way, Microsoft is making a lot of money off Game Pass regardless of how it's accomplished or what their expenses are which considering the vast majority of games are Indies and small titles, I can't imagine them spending that much money to get all of these games into Game Pass. The bigger titles, sure but not the vast majority of them in general.
Loves doing it? Dunno; felt like a struggle to get them to reveal the 25 million. We'll see if they give numbers next year in January or wait until closer to the end of their fiscal year.
I said they love giving the numbers every year which they have done. I believe that if there's a solid increase this quarter, Microsoft will definitely reveal it in late January. If not, then late July.
You REALLY gotta slow down on the praise just yet. Considering if the majority of their 1P are getting their money through GamePass rather than outright sales, $2.9 billion is roughly just 18% of Xbox's total annual division revenue. However, you have to take out the costs of the money paid to 3P publishers to get their games into the service, and that probably runs at least a couple hundred million a year. There are also the operating costs for running the Azure clusters for the hosted games, but that's probably maybe $100K or something annually, considering Microsoft own all the hardware and operating infrastructure related to Azure.
So effective revenue would be maybe closer to $2.8 billion annually. That's equivalent to 46.6 million $60 copies of a game sold annually...but is that actually what's going on here? Sony mentioned at one point during a peak year that 1P PS software accounted for 18.5% of all division revenue; during that same year PS generated $24 billion in revenue. Basically, 1P software accounted for $4.44 billion of total division revenue, or the equivalent of 74 million $60 copies (or 63.2485 million $70 copies).
However, I don't think Sony actually sold near that number of actual software copies in that year (want to say it was FY 2020, recalling from memory); @Yurinka might have some charts & graphs with actual numbers. So I'm guessing a lot of that revenue also included MTX & DLC sales generated from software releases not just that fiscal year, but up to that point. And if that's the case, it's probably similar with Microsoft.
Haha. I simply believe that when you look at Microsoft and their consoles for all four generations, they did stuff the competition didn't and revolutionized console gaming in one way, shape or form. With regards to Xbox One, as much as everyone was against their direction myself included of always online, 24 hour check ins and trying to push all digital, they ended up being 100% accurate. It's just that people weren't ready for it. Like the saying goes, timing is everything. Even now, less than a decade later, Sony's first party sales is 80% digital according to them. Microsoft is a $2T dollar company mainly because they simply see shit years if not decades earlier than everyone else. You can't stay as successful and powerful as they are if you don't see things before they happen.
Everyone needs to realize that while Game Pass has existed since June 2017, it wasn't until 2021 when they started putting more money into it in order to get a lot of day one games in the service. Not even two years have passed in this regard, they're simply doing better than most expected or anticipated especially when you look at the world and the situation a lot of people are in. People want interactive entertainment and outside of the hardcore which is the vast minority, they're not going to spend a lot of money in order to be entertained.
Again, until Microsoft releases a fully detailed report, no one will truly know for sure but we do know that Microsoft does see Game Pass as their present and future and unlike say Google, they won't stop until it becomes vastly successful for them if it isn't already. As for their first party studios, I believe they get budgets based on the games that they want to make and has nothing to do with Game Pass, sales or otherwise. Microsoft knows that they can't cheap out or put limitations or restrictions on their games. They will do what they need to do for their games to be successful and for them, it's not game sales but player counts and recurring revenue from those players that is what matters most to them.
Both companies have their own strategies and direction. It's just that I believe that Microsoft's will be the one that "wins out" in the long term because of how a lot of countries are in or will be in a recession and Microsoft offers the easiest, cheapest and most ways to get into their eco-system which is what it's all about.
I know there's PlayStation fans here and in general that are against Sony releasing their exclusives day one on PC or allowing this or that and in my mind, im like, why? It's not like they're going on Xbox or Nintendo so what's the issue? Bragging rights? I honestly don't get it. And im 100% a pure console only gamer yet I have no issue with Microsoft or Sony putting their games on PC day one or subscription or Cloud because I know that they'll make much more money doing so than not doing so and in turn, I will get more out of them in the long run because the more money they'll make, the more money they'll be willing to invest simply because they know they can make even more money than they already are.
I simply see Sony's business model as old, outdated and soon to be obsolete. Their business model only works if you're Nintendo - kids games, cartoony visuals, two generations behind in tech and I think you need an App or some shit when playing games online with Switch. I could be very wrong on this since im not a Nintendo guy but their direction is the only way Sony would be able to stay with their current business model.
For me personally, I get far more games for a $10 monthly rental on Xbox while on the Sony side, Microsoft spending tens of billions on Xbox should make them hungrier and want to compete even harder. Sony went into this generation basically just relaxing based on the PS4 generation which would have been fine if Microsoft didn't decide to go nuclear. Because of that, I am excited to see how Sony pivots and what kind of games I get out of them later on.
I love Sony's exclusives for the most part but Microsoft going nuclear and giving so much variety with their studios and exclusives has me super excited because while I love the single player third person action adventure games, in all honesty, im also bored of them at the same time because I have already played so many of them over the last decade that I want to see what else Sony's studios can do and come up with. I love Ubisoft as they're my #1 publisher and developer but in all honesty, they're fucking boring. I love a lot of their games but I don't get excited for them like I used to. Sony's games are becoming the same for me where as with Microsoft, im way more excited and hyped for their games and their direction because there's so much more variety to choose from and even if I don't like some of that variety, I still want that because I don't need or want every game to be for me because that would just be too freaking many and because I just want to see different games and ideas.
I'm expecting God of War Ragnarok to be my 2022 game of the year but here's a hot take or perhaps not since it's coming from me but im way more hyped and excited for Redfall. I'm not the biggest fan of first person games but I love Arkane, im a fan of looter shooters and the game has Vampires in it which few games nowadays do so while God of War Ragnarok will most likely be the better game and visually, blows away Redfall, it's nothing I haven't already played and experienced where as Redfall is completely different not just for Arkane but for me because it combines first person with being a looter shooter and it centered around Vampires.
Planning, or
insider knowledge of a pandemic & recession ahead of the curve
? J/K
Hahahaha. I mean to be perfectly honest, Microsoft has offered free upgrades, kept their games at $60 excluding the horrible Skyrim Switch port, has Game Pass which they push non-stop and haven't as of now tried to nickel and dime their fan base. Outside of the horrible Gold price increase which they reversed before the day even ended, Microsoft hasn't had any major or even minor screw ups. Add in the fact that you can play Xbox Series games with an Xbox One controller (which is ideal for me personally) and just other good consumer friendly offerings at a cheap price via several options including two consoles, PC, cloud, etc., they simply have been at the right place at the right time.
When you look at the world situation and what Microsoft has done thus far this generation, nearly everything has gone their way. Even the one major thing that hasn't - releasing exclusive games and content on a consistent basis won't last forever and once that starts going their way, they will have very few if any weaknesses.
Like I said earlier, timing is everything. And for Microsoft and Xbox, the timing for what they've done and have wanted to do has been near perfect this generation.
Same. Should be interesting to see what results they have had since the last reporting.
Yeah. Will definitely be interesting to see what the numbers are in a few months.
By the way, it's been a little while but I do enjoy having these debates with you.
