I think King won't be really affected by acquisition, but the revenues of Blizzard and Activision will be highly cut down by including their games day one on GP. And even more if their bigger selling console games stop selling on the top grossing console: PlayStation.
If they continue releasing the same amount of games and of the same size, the costs will continue being pretty much the same, but if their revenue highly decrease then also the profitability of ABK will also highly decrease.
Sure, the revenues from other games would decrease due to Game Pass but King will more than make up for it and then some. Besides, it's not about the short term. It's about the long term. Microsoft with Xbox isn't meant to be massively profitable even though it's already profitable, it's about building growth and expanding for the future which is when they will be massively profitable.
PlayStation introduced innovations in the console market like game subs, cloud gaming, VR and many more. And they are the market leaders pushing them. Not Microsoft.
Introducing isn't innovating. Innovation comes from the execution and in this regard, their cloud gaming is nearly non-existent with no massive plans for the future and they offer no games on that service since they don't really have one, VR gaming is extremely niche and I don't see PSVR 2 selling 10m let alone become mainstream and subscription wise, theirs at least for me leaves a lot to be desired as I only care about day one games. I don't care about all the old games because I either played/completed them already or they're of no interest to me. Sony has innovated but they've also copied mostly from Nintendo just as much. For me, I care about the execution because you can innovate all you want but if you fail, it means nothing.
Microsoft is innovating by allowing you to play their games on console, PC, cloud and mobile all day one while also providing them in their subscription service. Thus far, their execution has been solid but they have a long ways to go. The ideal situation is you can play games on the console/PC but you can also play them on your phone while you travel while also being able to access them on a smart TV at a hotel meaning you'll always have access to your games at any time.
The current model focused on selling software like games and digital addons (dlc, IAP, season passes) and playing them locally, and having game subs or cloud gaming as something secondary to get an extra revenue from old games is the model that works best for platform holders, publishers and devs. It's also a model that always allowed to have a huge amount of platforms and competition.
MS wants a Netflix/Spotify model focusing the business on subscriptions instead of selling games and addons, particularly their own subscription because they are only the ones capable to handle the massive loses this model generates. In that type of subscriptions games are mostly released there day one, including big AAA games (which highly shrinks the game sales of these games) and indies. Some made by them and other ones moneyhatted.
Since even themselves can only include a very limited amount of new games on GP every month compared with the thousands of games released today in the game sales focused model, it means that dozens of thousands of devs wouldn't be able to release their games because MS would act as a gatekeeper deciding what few dozens of games are released every month.
That would mean the death of most platform holders who wouldn't be able to keep this business model because it isn't sustainable for them and would also mean the death of most publishers and developers because it would only make sense for some of the ones accepted by MS and if MS pays them properly, as they do now but that could and very likely would change if MS gets on a market dominant position.
Game Pass is already profitable and I have said this for years because when you take the amount of paid subscribers, it's going to be more than Microsoft is spending especially when the vast majority of their games are Indies/AA titles. Just because they have Game Pass doesn't mean that you can't still buy their games. I bought Outriders and The Ascent despite playing them first on Game Pass but here's the benefit - I was able to play them first and make sure that I liked enough of what I played before purchasing them.
The old school model didn't work for Microsoft. We all know this. So why would they stay the same? That makes no sense. The competition is old school like most people here. It works for them. But just because it works for them doesn't mean that it was going to work for Microsoft. Going with a subscription model is what separates and differentiates Microsoft and Sony. This is what competition is all about. If something doesn't work for you, you don't keep forcing it. You try something else. You try something different. No whether Game Pass takes off remains to be seen but Microsoft simply isn't reliant or dependent on selling their games.
Microsoft putting their games into Game Pass day one decreases their sales but again, that was a success for 90% of their games to begin with going back generations so why keep doing the same thing when it clearly doesn't work for them? There's no valid reason for them to stay the same when it wasn't working.
How does having games in Game Pass prevent development studios and AA/AAA publishers from releasing their games on Xbox and having sales success? This is a massive stretch. Indies do well on Xbox and a lot of games do sell. Do they sell better on Xbox than PlayStation? Of course not but that's because PlayStation is the far bigger worldwide more powerful and more popular brand so they should sell more. Just because Game Pass exists, doesn't mean that everyone will stop buying games of all kinds. Sure, there's probably like 5% that does this but these people weren't buying games day one anyway.
PS4/PS5 has a combined user install base of 140m+. God of War Ragnarok sold 5m thus far. That's literally, 3.5% install base for the game. What happened to the other 96.5%? Some of you guys really stretch a lot of this stuff just because you prefer the old school model and don't want it to change.
Microsoft isn't gatekeeping. They can't just pick and choose what games to put on Game Pass. Obviously, not every publisher or development studio wants to have their game on Game Pass. In a lot of cases, they don't need Game Pass. But there's also plenty of cases where a game definitely needs Game Pass.
Believing that Game Pass is going to kill off billion dollar publishers is delusional. Come on. How many third party AAA games go on Game Pass in a year day one? Maybe two if you're lucky. Vast majority are AA/Indies and quite honestly, those are the publishers and studios that greatly benefit from Game Pass because why wouldn't you decrease the risk of monetary losses on your product? Too many of you are simply seeing what you want to see instead of what it actually is.
Your theory is just that, a theory. None of it is a reality and as of now, is not even anywhere close to becoming that. Even if Game Pass explodes, Sony will still make a shit ton of money and have plenty of games if not almost all of them. Every reason I see people here post is all "what if's" with no validation to any of it. If anything, it's all worries and concerns over something that hasn't happened, would take decades to happen and that's if it even does happen which I don't see.
Gaming is simply too massive for what you believe may happen to actually happen. There was a far greater chance of what you believe happening 30+ years ago when the industry was small and minuscule compared to 2022.
I think that in the current context of the biggest key players in the market having not even 20% of gaming market share they should be allowed to acquire companies, even big publishers. Or to pay for (often timed, often console) exclusives of single games.
But I also think that to get an (often timed, often console) exclusive of a single game, or even multiple ones can't be compared at all to buy the biggest 3rd party publisher in the market and many big IPs including the (probably) most successful one in gaming. First because to buy exclusive it's something that all 3rd parties do and not only Sony. And second because the impact they have is tiny with buying the biggest 3rd party publisher.
As far as I know we have nothing leading to think Bethesda, ABK or anyone else bought by MS was going to go bankrupt or that were going to shut down some of their studios.
Bethesda potentially going bankrupt or shutting down studios was reported by Schreier (sp?) and while I don't like the guy, he's arguably the best at what he does. Bethesda sold because they were losing a lot of money and needed to sell. They simply weren't going to survive without a massive restructuring and downsizing. Whether or not you want to believe that is up to you. Let's say you're right, there's just one problem that goes against your argument which is the simple fact that since 2018, Bethesda was looking to sell. Companies only sell as a last resort or if they simply get a deal that is too good to pass up. It took Microsoft just under two years to reach a deal for Bethesda. Google was confirmed to be a bidder for Bethesda and came up way short. Would Google acquiring Bethesda have been better for the gaming industry and gamers/consumers? You could easily argue that it would have been far worse because as we've seen, Google shutdown their entire platform because it didn't take off and like the other hundreds of items or gadgets or whatever Google have released and then shutdown because they didn't take off immediately, chances are, Bethesda would be dead and NO ONE would have access to their games in any way, shape or form.
As for ABK, shareholders wanted Kotick gone. Way too much sexual shit going on in that company for it to be ignored. They were also potentially going to be sued by California and yes, as much as people may not want to believe it, they could have been in a situation where they would have legally forced to be shutdown or file for bankruptcy in order to avoid it. Kotick simply wants his massive payday and if you're him, how do you get that? By going to companies that are worth much more than you are and seeing if they're interested in acquiring your company. Microsoft is literally one of the few that could have accomplished this for Kotick. And it was already confirmed that he went to Facebook first and they said no thanks.
As for the entire exclusivity argument. I will always disagree. Here's why - let's use Forspoken as an example since it hasn't been determined yet. If it was day one on Xbox Series X, sales would be minimal but in 2025, they'll be literally non-existent because no one is buying this fucking game at $70 two years later. Not going to happen. Even this January, I don't see more than maybe 2m in sales the first 6 months if they're lucky for the game. The game will be dead on arrival and the IP itself right behind it.
There's literally no risk for Sony here with these deals. They pay some money upfront and they'll make it back easily from the 30% cut on sales and overall in general based on the individual that buys other stuff besides Forspoken. For Square Enix, they get a small upfront payday at the risk of stagnating any growth the game and IP could have by limiting it to only PlayStation 5. Plus, it's not cross-gen so that lessens that market even more.
The main difference and this is why I will always disagree is that unlike Sony with a timed exclusivity deal in which they pay upfront once and that's it, Microsoft acquires a publisher and have to fund the entire freaking company. From all the employees to all the staff members to marketing to advertising to development to contract workers to the tech used to everything in between, Microsoft literally will have to fund it all. And when you're funding it all, yeah, you have the right to do whatever you want with what you own.
Also, timed exclusivity, full exclusivity or acquisitions, the end result as I have said is still the same - you're still gatekeeping. Doesn't matter if it's a month, a year or a decade. It doesn't matter. Games always sell their most and their best at launch or shortly thereafter. There's never ever been a game that was timed exclusive that sold better when it released on the second platform because at that point, no one cares and they've moved on.
I understand that people here obviously want to play everything on their PlayStation. I get it. I really do. Because I want to play everything on my Xbox. But that's not how the industry works. It's never worked this way. It never will. If anything, people here call me an XBOT all the time. Okay, fine. But I own a PlayStation 5. I bought GOWR. How many PlayStation 5 owners here actually own an Xbox Series X or S? Probably very few so who's the real fanboy/extremist? It's not me because I don't limit or restrict myself and im not going to cry about a company buying publishers. Let them all go nuts. I don't care because it doesn't affect me. And im sure most people here can afford a Series S at the minimum so if these people still choose not to buy it to play the games that they want to play, im not going to apologize. I have no sympathy for these people because the games are important and you want to play them or you don't. That's how I look at it all.
In the acquisition deal and in multiple statements from both MS and ABK it was stated the opposite, that he continues in charge of ABK.
Kotick will hang around for a few months after the acquisition closes and will then walk off into the sunset with a motherfucking massive payday. Kotick is simply too toxic to keep around and if he wasn't, well, he wouldn't have looked to sell in the first place. Microsoft doesn't own ABK as of now so of course, they'll play it up but my guess is that his walking away has already been set in stone and they are all just waiting for that time to get here.
We don't know which conditions asked MS to Sony to keep releasing CoD for 10 years. They can be something abusive for Sony, like demanding them to publish PS Studios games on Xbox, reducing their revenue cut from 30% to 0%, to pay them a gazillion dollars, etc. The offer they got caused Jimbo to rant for the first time on public, so the offer must have something else that still hasn't been mentioned publicly due to NDAs.
Let's just say it's a straight forward 10 year deal. All Microsoft gets is the 30% cut from sales and micro-transactions. Why wouldn't Sony accept that if COD is in their own words, ESSENTIAL? If they decline their offers, then all that does is prove that they're full of shit and that it's not essential.
Yes, King is the top money maker in ABK and mobile gaming is the area where MS will grow more thanks to the acquisition. But MS already has a big presence in mobile with Minecraft.
Minecraft is big but Microsoft is near non-existent when it comes to mobile gaming. King changes this barring them not fucking it up which granted, is always a possibility.
Sony is selling now more than ever and they release more new IPs than ever and than any other platform holder or big publisher, and also support/moneyhat more indies (most of them new IPs) than any other platform holders or that Sony did before.
They release new IP's, no argument there but the vast majority of them all have the same template/formula. What I want to see is some of the old stuff be remade and come back. Doubt this will happen but I can hope that it does.
Sony didn't try to buy the biggest 3rd party publisher and a lot of big IPs or to switch to a business model that if become highly dominant would kill all the other platform holders and most publishers and devs.
Sony only made way smaller acquisitions and signed isolated exclusives for some games, just like any platform holder like Nintendo, MS, Steam, Epic, Apple or Google (or past ones like Sega) did. Sony's strategy and what they did is very different than the MS one.
Sony didn't try to buy ABK not because they wouldn't but because they don't have the money. Make no mistake, if Sony had the money, they would have been right there sitting across from Microsoft at the bidding table. Don't ever act like Sony wouldn't do the same because we both know they would and to be perfectly honest, they should. If you're Nadella and pass on ABK, that's most likely going to lead investors and shareholders potentially wanting to remove/fire him because passing up on ABK regardless of the risk/cost would just be a horrible decision for a CEO.
As for switching business models, I don't understand your argument here. If what Microsoft was doing wasn't working, why should they stay that way? What should they have done? I mean come on. Some of the arguments people here have make no sense. Like, one business model fails but fuck it, let's just keep doing the same thing over and over. Also, just like in regards to the ABK deal and the CMA and others, it all hinges on WHAT IF. I love that. This is hilarious to me. Don't allow Microsoft to do anything because WHAT IF this or that happens. LMAO.
Yes, Sony's strategy is different and works for THEM. The same strategy wasn't working for Microsoft so again, WHY should they stay that way?
In my mind, I believe that most people here never ever want to see Microsoft or Xbox compete or do better. Instead, I believe that most people here just want to see them stay shitty. And when I see that people argue about them going in a subscription model is a negative when that's exactly what competition is literally all about. If your business model isn't working, you CHANGE it. That's the definition of competition because when every platform offers an actual DIFFERENCE, that's what will separate them from being the same as their competitor.
