Where have you been lol. If it is xbox related it is concen trolling, baiting and drive bys. Scower the internet for a phrase to use to discredit anything positive Microsoft. But but it is the evil cabal of the last 3 xbox fans who are the boogie men lol. I am reading post complaining where are the xbox fans lol i wonder.
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Microsoft admits Xbox Game Pass is Not a Big Money Maker ATM
- Thread starter xStoyax
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Demon2blades
Member
But did Netflix have a ready made userbase like ms did with gamepass ? That's where I think they different but I'm not familiar with Netflix's beginning so can't outright say .
EverydayBeast
thinks Halo Infinite is a new graphical benchmark
M$ has openly campaigned for gamepass and now they're playing musical chairs between gamepass, xcloud and xbox live.
Xbox Live and Gamepass right now live look
Xbox Live was SECURE and game pass came along trying to change everything.
Xbox Live and Gamepass right now live look
Xbox Live was SECURE and game pass came along trying to change everything.
jakinov
Member
They make billions in profits a year and have billions of dollars sitting in the bank. Most big companies have a shit ton of deliberate strategic debt. Their debt is growing but so is their revenue and their profit. Whether or not their borrowing habits are sustainable is a different issue. But they aren't just using the money to create content either, they are using it to buy/build productions studios and land so that they create things cheaper in-house (so they don't pay a 3rd-party a marked up price for content) and make other revenue.
GHG
Gold Member
Yep most large companies leverage debt to create opportunities for themselves but that debt needs to be repaid some day, even if it's structured in a way that they don't need to pay it back for another decade. Eventually they will need to transition the business to one where it's not reliant on debt for customer/content acquisition and it's at that stage when things become make or break. That's the whole premise of the loss leader strategy.
Mitsuda Maniac
Member
Expect a lot of DLC and MTX to help make up for losses.
yurinka
Member
Yes, I think they are very decent numbers but there's a big difference between them between how relevant Netflix and Gamepass are for their markets and the paradigm shift they meant for them.
To build the userbase for Netflix was more difficult because they were essentially changing the cinema and tv market, making a paradigm shift for the main business model and how these products are consumed.
Game subscriptions are still something very secondary in gaming compared to what they became thanks to mostly Netflix for cinema and tv. Microsoft didn't achieve that with Game Pass, they only iterated the game subscription idea previously seen in PS Now, Humble Choice -previously Humble Monthly- and others. Even PS Plus or Gold but adding to the mix some day 1 AAA games as their main USP.
More recently we saw Stadia, Amazon, Apple, Google joining the game subscription wagon and Sony interested to improve their PS Now offering, in addition to MS adding a game streaming feature to make their offering more similar to PS Now, and seems that they plan to merge several subscriptions to increase their userbase and generate more revenue.
For what we know about the next Halo and Forza seems it's going to be the case for the main MS IPs, a GaaS approach putting their games under Gamepass to reduce pricing friction but without going F2P and focusing on adding content for a longer period of time instead of focusing on selling the on retail. This means many free updates and many paid DLC/expansions/microtransactions.
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AgentP
Thinks mods influence posters politics. Promoted to QAnon Editor.
I think MS loses their pants on 1st party games. They sink 4-7 years of development and then their most loyal customers who would have spent $60 instead play for minimal subscription. I know I got to not buy FH4, Crackdown 3 and Gears 5 because of the $15 or whatever I paid. They are going to have to keep giving up revenue or raise the price.
This is all they need to do to counter gamepass if they want to get serious.
Sony would still win in the end, i'm not sure what this change in the industry would bring us though.
I want Sony to keep making amazing exclusives and not just become a gamepass competitor.
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sainraja
Member
If they signed up because it was a dollar, then chances are they might also cancel when it goes up.
R3claimer117
Member
You’re talking out your ass! How can you say for certain it’s not a successful service. Saying something I don’t like is not successful because Sony is just fanboy nonsense. They clearly said it was a reason for their gaming division being up last quarter. And they have more then 10 million people subscribed to the service so again no one cares about your console war interpretation of success.
Rbk_3
Member
I did that, but I don't own an Xbox anymore
R3claimer117
Member
Can we stop with this nonsense that everyone subscribe to gamepass is paying a dollar that’s non sense.
Roman Empire
Member
I know I did.
iHaunter
Member
Then increase the cost, decrease the quality of the games, spread them out piece-meal so people stay subbed.
Look how degraded the quality of Infinite was, expect the same and worse with Game Pass getting bigger.
R3claimer117
Member
Wtf does infinite have to do with gamepass infinite issues is that it’s a cross gen game. So when the sequel inevitably comes and looks way better because it’s no longer cross gen does that mean the quality of game pass went up? What kinda logic is being applied here?
Jigsaah
Gold Member
Better for me. Don't care if Gamepass is profitable. If they wanted to make it profitable, Gamepass would be a lot more expensive.
I can't believe people are actually concerned about Microsoft's finances. Unless you got stock in Microsoft, why do you care? It's a trillion dollar company.
What's real is people who sit here and moan and groan about Gamepass not being "a big money maker" is not truly concerned for Microsoft's monetary success.
It's used as a scapegoat to push their own narrative of how in some way Gamepass is a bad thing, or a failure. So ridiculous.
I hate people.
I can't believe people are actually concerned about Microsoft's finances. Unless you got stock in Microsoft, why do you care? It's a trillion dollar company.
What's real is people who sit here and moan and groan about Gamepass not being "a big money maker" is not truly concerned for Microsoft's monetary success.
It's used as a scapegoat to push their own narrative of how in some way Gamepass is a bad thing, or a failure. So ridiculous.
I hate people.
iHaunter
Member
Wtf does infinite have to do with gamepass infinite issues is that it’s a cross gen game. So when the sequel inevitably comes and looks way better because it’s no longer cross gen does that mean the quality of game pass went up? What kinda logic is being applied here?
Who will buy a game at a full $60 or $70 when you can get it on Game Pass for free? Xbox isn't making money on the game pass as it is, the only way to do so is to reduce the staff in your studios and take more short-cuts when doing game development. What part did you not understand?
Shhhhh gamepass is bad for consumers you could of bought 3 and owned 3 indy games for the 60 a year you paid instead of playing and finishing 15-20 games lol.
Yes that is why inexile, playground rpg, obsidian entertainment ect are all hiring. It is a nice attempt to taint other Microsoft studios because 1 sucks.
R3claimer117
Member
You think they care by the time infinite comes out they’ll probably have 20 million subs not to mention a lot of 360 gamers that went PlayStation last gen due to having better multiplats might come back to Xbox this generation for the same reason. That means in the next couple years they could have upwards of 30 million subs to gamepass. That’s a lot more profitable in the long run the someone paying 60 dollars one time for the game. Lol I can’t believe the logic in here it’s nuts. It’s a lot more profitable to have people paying you monthly then one time I know I know everyone on gamepass is paying a dollar
now and forever.
IntentionalPun
Ask me about my wife's perfect butthole
It's sustainable if people continue to subscribe at full price.
A HUGE chunk of their current base paid little to nothing for it.
A HUGE chunk of their current base paid little to nothing for it.
Patterson
Member
I don’t think people are concerned with Microsoft profits, they’re concerned for what the gaming landscape will look like if Gamespass becomes ”successful“ and becomes the standard.
TalentedMrJ
Member
Didn't Netflix follow a similar path. Losing tons until turning a profit.
I remember Netflix being terrible. Max picking out movies I had no interest in. Gave me and my gf a good laugh
I remember Netflix being terrible. Max picking out movies I had no interest in. Gave me and my gf a good laugh
Shai-Tan
Banned
I was very critical of EA Access early on because I think it ends up being profit taking for probably 75% subscribers long term over them buying games they would actually play but Game Pass has such a variety of games that I’ve often found something to play beyond 2-3 titles. It still has that bundling like an insurance scheme where people who don’t use end up paying for the ones who do and I have no idea how the economics work out for developers but on an individual level at least it’s a fantastic deal even if it went to $8-10 a month (again assuming you’re disciplined enough to unsubscribe on low use)
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AGRacing
Member
We need Sony and Microsoft to stay competitive with each other... because you know what Game Pass would look like if it wasn't for Sony existing.. and you know what the PlayStation 4 might have looked like if 360 didn't have such a good run at the previous generation.
Game pass will be great as long as Microsoft is hungry... but they could lose their appetite at ANY time and you'd better hope you haven't paid 3 years ahead at that point.
Game pass will be great as long as Microsoft is hungry... but they could lose their appetite at ANY time and you'd better hope you haven't paid 3 years ahead at that point.
Gamerguy84
Member
The deals were so good it had absolutely every gamer wanting to try it out, provided they had a PC to run it. Im not a MS guy at all and picked it up for gears and to try forza.
IntentionalPun
Ask me about my wife's perfect butthole
Microsoft claims GP is profitable though.
edit: Correction, see my post below.. they've said it's not bleeding money
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iconmaster
Banned
I don't understand MS' business model then. The going wisdom has been they don't care if you get the next Xbox so long as you're subscribing to their services. But if the services aren't making them much either, then..??
Edit: I suppose Greenberg's point is Game Pass isn't profitable right now. It still could be in the future.
Edit: I suppose Greenberg's point is Game Pass isn't profitable right now. It still could be in the future.
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Nikana
Go Go Neo Rangers!
receipt?
Nikana
Go Go Neo Rangers!
They arent making money right now. Long term they can.
Evangelion Unit-01
Master Chief
Misleading headline from Gamespot. I watched the segment from the podcast they "sourced" this from. He never said it was not making money/not a money maker. Time stamped.
To paraphrase, he says "do not worry about MSFT, we aren't hurting. It is a different mindset about delivering value to customers and growing subcount."
Clearly, they have 10MM+ subs and I am sure they are hoping to double that number in the next year. That is a tremendous amount of revenue.
I think where people are getting hung up is on him saying "it's not a big profit play". I believe what he is getting at is the fact that MSFT could sell Halo, Avowed, Forza, etc for $60 and try to maximize profit that way. Instead they have found that by adding them to Game Pass they make money as they grow subscribers and as those subs buy micros within the games they are now getting as part of their sub. It is a different "play" revenue by subscriber volume vs revenue by sales volume. Same thing MSFT has done with Office, Windows, Azure etc. It fits into their SaaS model.
I think it is safe to say Game Pass is making plenty of money given MSFT's Xbox revenue from their year end report.
SNE has seen similar success with PSNow. Both companies are embracing the subscriber model while trying to offer choice w/ digital, physical, and subs.
Ubisoft is dipping their toes into the water as is Nintendo with using it for their back catalog on NSO. There will be plenty of other companies trying this model in the future.
Console wars are one thing but the profitability concerns are just silly. Especially because it often comes from people without experience in finance like Gamespot. I think the shareholders will be very happy.
To paraphrase, he says "do not worry about MSFT, we aren't hurting. It is a different mindset about delivering value to customers and growing subcount."
Clearly, they have 10MM+ subs and I am sure they are hoping to double that number in the next year. That is a tremendous amount of revenue.
I think where people are getting hung up is on him saying "it's not a big profit play". I believe what he is getting at is the fact that MSFT could sell Halo, Avowed, Forza, etc for $60 and try to maximize profit that way. Instead they have found that by adding them to Game Pass they make money as they grow subscribers and as those subs buy micros within the games they are now getting as part of their sub. It is a different "play" revenue by subscriber volume vs revenue by sales volume. Same thing MSFT has done with Office, Windows, Azure etc. It fits into their SaaS model.
I think it is safe to say Game Pass is making plenty of money given MSFT's Xbox revenue from their year end report.
SNE has seen similar success with PSNow. Both companies are embracing the subscriber model while trying to offer choice w/ digital, physical, and subs.
Ubisoft is dipping their toes into the water as is Nintendo with using it for their back catalog on NSO. There will be plenty of other companies trying this model in the future.
Console wars are one thing but the profitability concerns are just silly. Especially because it often comes from people without experience in finance like Gamespot. I think the shareholders will be very happy.
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Not a big profit could still be millions of annual profit depending on the speaker's subjective characterizations. But even if it is not a profit driver yet, that would hardly be a surprise or cause for concern. If the service is doing poorly in another 18 months, then it might be time to worry. Maybe.
CatLady
Selfishly plays on Xbox Purr-ies X
You know what's even weirder? Sony fans are the only ones that are "concerned" about the profits of a trillion dollar company. Xbox and PC fans just enjoy reaping the benefits of the best deal in gaming.
Hezekiah
Banned
I'm saying I think a lot of people would sign up for GamePass/ X-Cloud for $1 a month.
We don't know how many people would pay $15 a month though because MS has been doing a lot of sales over the past few years, and they won't realise the financials so we can't even estimate the average price paid.
longdi
Banned
Office 365 is their money generator going on.
They already phasing out sales of standalone office. It has stopped at Office 2019, i had to buy that fast
Im not sure how paid subscription can be a counter against google docs.
SirTerry-T
Member
It's ok OP, Microsoft will be fine, I'm sure.
IntentionalPun
Ask me about my wife's perfect butthole
I read it here.. but I think it might have been someone misinterpreting this interview:
Spencer: Xbox Game Pass isn’t “burning money to gain customers”
Xbox Game Pass is a sustainable business venture, Xbox head Phil Spencer told Stevivor. At X019 in London late last year, Spencer admitted to Stevivor that M
stevivor.com
So yeah, sorry.. I was wrong.. the implication is that there are losses but not significant.
Klayzer
Member
Yeah, they keep trying to change the argument to care about Microsoft profits. Nobody cares about the money, all I care is how will effect my games, and will it force other publishers to go the same route because of money. I can't speak for everyone, but I have no intrest in my games being sub based.
There's a pro and a con to virtually every decision made in this industry, and certain people want only to push the company pr narrative. I don't understand why users gets so angry when others have a different take on Gamepass.
Journey
Banned
This is good for gamers. It’s a tremendous value, we’ve known this for a while.
mckmas8808
Mckmaster uses MasterCard to buy Slave drives
Many of us on GAF tried to tell people, but they ignored us.
Le Big Mac
Member
Understandable: A lot of startups and nascent developing projects within companies are loss-leading for years - a quick example is Salesforce who have enterprise products that most businesses use but any scaling or other application they will sell will be a loss to them picked up by more profitable products in the line, however Salesforce is also one of the most profitable software as a service companies out there. This is a long gamble by MS, Netflix their direct analogue rarely turns a true profit if we consider the level of borrowing and that increases year on year. MS is in a different position in the market and have plenty of it's own cash to burn through and make a loss on gamepass and make it back on gold subs.
Tl;dr MS likely doesn't care and are hoping this pays off in market domination in the long run
Tl;dr MS likely doesn't care and are hoping this pays off in market domination in the long run
FunkMiller
Gold Member
You’re right on this of course, but it’s worth pointing out that Xbox wouldn’t be able to be unprofitable, or run at a loss for long before the shareholders would start kicking up a stink.
An arm of a gigantic, rich corporation is not safe just because it’s part of that huge business. It needs to become, and remain, profitable to sustain its position.
PharaoTutAnchAmun
Member
So prepair for a higher pricepoint for GamePass
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