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[Sanepar]

problem of gamepass is simples, if 80-90% of consumers migrate to a subscription model and only want to consume games on this model(like xbox install base) if u want to make a game u need to be on the subscription model or you will be fucked and if we have a big dispararaty in terms of users on subscriptions services most of them would not be profitbale, because would not be viable to make a single player only with a budget of $250 mi on this model.

 

[Three]

Was it Microsoft or Sony who is currently investing heavily in GAAS first party titles? I can't seem to recall...

https://videogamesrepublic.com/sony-wants-to-become-a-gaas-factory-10-service-games-before-2026/

"To use an expression that one of our faithful readers found: a real “GaaS factory” is looming. In its latest conference with investors, the Sony group confirmed its plans for the game-services area. By 2026, the company expects to be able to release 10 new titles in the live-service form."

In case you hadn't noticed they did this when they introduced their own sub and MS had been nothing but a GaaS factory for years already.

 

[Salty Popsicle]

Its is absolutely not the bigger issue....and also not even what this thread is about. MS has built their ENTIRE business model around GamePass. Sony on the other hand has not. PS Plus is complimentary to their traditional model. GP is front and center and therefore makes it way more important (to MS).

You're obviously not very informed about this issue at all.

https://www.thesixthaxis.com/2022/1...ces-revenue-but-growth-is-slowing-on-console/

"Speaking at WSJ Tech Live (as transcribed by The Verge’s Tom Warren), Spencer said, “Game Pass as an overall part of our content and services revenue is probably 15 percent. I don’t think it gets bigger than that. I think the overall revenue grows so 15 percent of a bigger number, but we don’t have this future where I think 50–70 percent of our revenue comes from subscriptions.”

 

[Salty Popsicle]

In case you hadn't noticed they did this when they introduced their own sub and MS had been nothing but a GaaS factory for years already.

Starfield has been the most heavily marketed game on the service since GamePass started and it's a single-player RPG.

 

[Three]

Its the opposite single player games are perfect for subscribers. Gaas kills subscribers because if a person only plays 1 game they just pay for the 1 game. Subscriptions are valuable for the variety and playing lota of different games.

Where do you get this idea from? Subscriptions devalue single player games. Did you miss the leaked emails where MS directly value a game based on average hours spent? Which do you think is worth more to gamepass? a big budget 10 hour game or some low budget 1000 hour GaaS game?

 

[Three]

Starfield has been the most heavily marketed game on the service since GamePass started and it's a single-player RPG.

That's great and all but that's not what I said. Spiderman is also a heavily marketed single player game on PS+. Doesn't mean it's proof they don't have a GaaS drive for subs. MS has had a multiplayer focused GaaS/live service drive for decades due to their subscriptions.

 

[SmokedMeat]

We've seen how this can play out in other media, with unique ideas often sidelined for 'safe bets' that guarantee views or plays.

The gaming industry thrives on innovation and creativity, and it would be a genuine tragedy if we lost that in the pursuit of subscription numbers.

Safe bets dominate the AAA market. The AAA industry does not thrive on innovation and creativity in any way shape or form.

Anybody who thinks otherwise can list me the top 20 games of this generation. I guarantee more than half of the list are safe sequels and remasters/remakes.

 

[Salty Popsicle]

That's great and all but that's not what I said. Spiderman is also a heavily marketed single player game on PS+. Doesn't mean it's proof they don't have a GaaS drive for subs. MS has had a multiplayer focused GaaS/live service drive for decades due to their subscriptions.

Sony doesn't release their games on PS+ from day one. False equivalence.

 

[Humdinger]

I dont get it, how is tying a games value to the subs any different than tying it to traditional sales? In both cases the developers need to deliver. If anything gamepass offers potential for greater creativity for a larger group of developers like what MS has since it secures a large steady revenue stream even if a game or 2 fails.

One way I think it might be different is that with traditional sales, the metric for success is very clear. How much did the game sell? With GP, the metric for success is whether it drives GP subscription numbers. With all the different irons in the fire at the same time, that can be difficult to quantify -- unless it's a huge, long-anticipated game like Starfield, surrounded by a desert of other releases. Then you can see GP sub numbers bounce up very noticeably, even console purchases.

But think about smaller titles, less noticeable ones. From a traditional sales perspective, it's very easy to know whether they have been successful: How much did they sell, relative to their budget? But in judging a game based on increases in GP subscriptions, a smaller game might not make any discernable impact at all. So how do they know if it's been successful? Amount of time played? If that doesn't add to their sub numbers, is that a success? It becomes more ambiguous.

 

[Three]

You're obviously not very informed about this issue at all.

https://www.thesixthaxis.com/2022/1...ces-revenue-but-growth-is-slowing-on-console/

"Speaking at WSJ Tech Live (as transcribed by The Verge’s Tom Warren), Spencer said, “Game Pass as an overall part of our content and services revenue is probably 15 percent. I don’t think it gets bigger than that. I think the overall revenue grows so 15 percent of a bigger number, but we don’t have this future where I think 50–70 percent of our revenue comes from subscriptions.”

He is informed. You just don't get how it works based on that statement. The literal backbone is gamepass. That doesn't mean they don't have revenue that isn't dependent on gamepass being the backbone. You sell hardware at a loss to increase gamepass subs. That makes up a chunk of revenue that isn't part of the sub revenue but subs is still what you're trying to drive. You sell microtransactions and DLC to subscribers, that's a huge chunk of revenue that's not part of the sub revenue but you rely heavily on the subs and that engagement to drive it.
People keep trying to use that 15% of revenue to suggest gamepass isn't MS main gig but they are usually being too reductive by just pointing to that percentage when Gamepass is actually MS main thing.

Sony doesn't release their games on PS+ from day one. False equivalence.

What has that got to do with anything really?

 

[Salty Popsicle]

He is informed. You just don't get how it works based on that statement. The literal backbone is gamepass. That doesn't mean they don't have revenue that isn't dependent on gamepass being the backbone. You sell hardware at a loss to increase gamepass subs. That makes up a chunk of revenue that isn't part of the sub revenue but subs is still what you're trying to drive. You sell microtransactions and DLC to subscribers, that's a huge chunk of revenue that's not part of the sub revenue but you rely heavily on the subs and that engagement to drive it.
People keep trying to use that 15% of revenue to suggest gamepass isn't MS main gig but they are usually being too reductive by just pointing to that percentage when Gamepass is actually MS main thing.

Console hardware being sold at a loss has been a reality of the business ever since the console market first started decades ago. It has absolutely nothing to do with wanting to sell subscriptions.

Same thing to your point about these companies wanting to sell DLC. That is true of all of these console manufacturers and game publishers whether they have a subscription service or not.

You are conflating so many things that have no bearing on this discussion.

 

[PontiusFeeb]

Thank goodness this thread is labeled "STATEMENT" or else I might have thought it was a question despite the period at the end.

 

[Kenshin775]

I hope the subscription model makes games less bloated like it did with tv shows. I would rather play a 15-25 hour game with quality content then a 50 hour game with a bunch of filler needed to justify that $70 price tag.

 

[Three]

... So how do they know if it's been successful? Amount of time played? If that doesn't add to their sub numbers, is that a success? It becomes more ambiguous.

That's correct. From the leaked emails it seems they measure this by average hours played for a game. Now imagine a 10 hour single player game that costs $200M vs a multiplayer GaaS game.

Console hardware being sold at a loss has been a reality of the business ever since the console market first started decades ago. It has absolutely nothing to do with wanting to sell subscriptions.

Same thing to your point about these companies wanting to sell DLC. That is true of all of these console manufacturers and game publishers whether they have a subscription service or not.

You are conflating so many things that have no bearing on this discussion.

Except you're not getting that selling consoles can still be a requirement to building their business model around GamePass. Does selling consoles at a loss not counting as 15% of the revenue discredit that? It's still part of the business model.
They want to sell DLC does 10M players launching a game through gamepass or buying discounted season passes via that improved engagement not mean your business model is Gamepass?

 

[StreetsofBeige]

Its is absolutely not the bigger issue....and also not even what this thread is about. MS has built their ENTIRE business model around GamePass. Sony on the other hand has not. PS Plus is complimentary to their traditional model. GP is front and center and therefore makes it way more important (to MS).



Which somewhat validates the OP and the first 20 minutes of the video I posted earlier in the thread. No matter what fud you hear from Phil and team through the media, it is not sustainable. Especially after hearing the leaked info that came out here recently.

Who really cares if a console maker sub plan are sustainable or not? It comes to value for the gamer. If MS, Sony, NF, Spotify, Disney, Hulu etc... want to scrap sub plans and go back to selling disc and digital copies go ahead. In the meantime, I'll take a deal.

It's like Columbia House where you can get tons of CDs for cheap. I know that doing their promo deals the avg CD cost me around $10. Buying them all regular price back in 1994 were like $20 CDN each. I'll take the deal as long as possible until I find it not worth doing or CH closes shop.

Video gaming is an industry where there's so many people on forums (and deal sites like CheapAssgamer back in the day) where gamers love a good deal on prices, 2 for 1 Amazon/Target deals, which places offers the best trade back value etc... Anything to save a few bucks.

Sub plans come around giving gamers an option to sub or if they want buy the game for regular price. No different than CD buying in the 90s or Disney offering movies and TV series on Disney+ or just buy the BR set on Amazon for $100 if you need a physical copy. There's options.

But I totally get it that some gamers hate sub plans because their platforms sub plan stinks, got a 33% price increase and no additional value lately. Or that they prefer collecting discs for $70 US per game and some random guy on a sub plan is paying dirt cheap money with access to 300 games which might even include the $70 US game. So the guy feels ripped off. I understand. The first guy is a physical copy purist and hopes everyone else copies his purchase pattern. Nobody likes to feel ripped off. But sub plans are an option not a forced upon service. If someone doesn't like sub plans then just buy the game or TV box set for full price.

 

[MarkMe2525]

The real danger is if developers start crafting games not out of passion or creativity but out of a need to fit a 'subscription-friendly' mold. We've seen how this can play out in other media, with unique ideas often sidelined for 'safe bets' that guarantee views or plays.

The gaming industry thrives on innovation and creativity, and it would be a genuine tragedy if we lost that in the pursuit of subscription numbers.

What do you folks think?

There is no single "real danger" and the assertion is hyperbole. A "real danger" is development costs getting to the point where only the big boys can play. A "real danger" is those costs suppress original ideas and instead pressure studios to only greenlight "sure thing" products. A "real danger" is the outsourcing of development to lower production costs that eventually leads to a situation similiar to the USA manufacturing jobs, they all go to countries with devalued currencies.

A new distrubtion model is the least of the industries problems. If not the least, it still is no where near the top, imo.

 

[Unknown?]

Was it Microsoft or Sony who is currently investing heavily in GAAS first party titles? I can't seem to recall...

https://videogamesrepublic.com/sony-wants-to-become-a-gaas-factory-10-service-games-before-2026/

"To use an expression that one of our faithful readers found: a real “GaaS factory” is looming. In its latest conference with investors, the Sony group confirmed its plans for the game-services area. By 2026, the company expects to be able to release 10 new titles in the live-service form."

Sony's just trying to create variety within their studios, so they're upping their output in other areas. They are still far behind MS in GaaS production with these acquisitions.

 

[Salty Popsicle]

Sony's just trying to create variety within their studios, so they're upping their output in other areas. They are still far behind MS in GaaS production with these acquisitions.

What GAAS games does Microsoft have lined-up for the next few years? What GAAS games have they released in the past few years?

 

[Unknown?]

What GAAS games does Microsoft have lined-up for the next few years? What GAAS games have they released in the past few years?

They've made several statements about GaaS. And they're still supporting Sea of Thieves.

 

[Salty Popsicle]

They've made several statements about GaaS. And they're still supporting Sea of Thieves.

Sea of Thieves came out in 2018. If that's the only example you could come up with, it makes Micrsoft's GAAS scene pale in comparison to the 10 in active development within PlayStation.

 

[Unknown?]

Sea of Thieves came out in 2018. If that's the only example you could come up with, it makes Micrsoft's GAAS scene pale in comparison to the 10 in active development within PlayStation.

No we know they're pursuing GaaS based on their statements and if they get Activision they'll have a ton.

PlayStation could be counting Gran Turismo 8 for all we know since GT7 was a GaaS game.

 

[Three]

What GAAS games does Microsoft have lined-up for the next few years?

Spencer Forza Motorsport is a GAAS with years of support

Going back to Forza, you actually dropped the number. So is Forza Motorsport becoming a service platform or what's with the change? PS: Yeah. Service platform, I hesitate a little bit because I think there's a lot of loadedness in what that means. I think what we see with Forza is the evolution...

www.neogaf.com

What GAAS games have they released in the past few years?

343 says Halo Infinite has become a "consistent" live service title, but still needs more "quality"

"Where we need to start showing more noteworthy improvements is with quality. Both technical and experiential quality."

www.gamedeveloper.com

 

[THE DUCK]

One way I think it might be different is that with traditional sales, the metric for success is very clear. How much did the game sell? With GP, the metric for success is whether it drives GP subscription numbers. With all the different irons in the fire at the same time, that can be difficult to quantify -- unless it's a huge, long-anticipated game like Starfield, surrounded by a desert of other releases. Then you can see GP sub numbers bounce up very noticeably, even console purchases.

But think about smaller titles, less noticeable ones. From a traditional sales perspective, it's very easy to know whether they have been successful: How much did they sell, relative to their budget? But in judging a game based on increases in GP subscriptions, a smaller game might not make any discernable impact at all. So how do they know if it's been successful? Amount of time played? If that doesn't add to their sub numbers, is that a success? It becomes more ambiguous.

It's probably not as hard as it seems, number of downloads and hours played is probably a very clear indicator of success. Might even be easier to tell than raw sales numbers on a traditional title. And no doubt the benchmark of dcpectation is measured by the development costs and or cost paid to get the game.

 

[vkbest]

I like Gamepass and I think it's because of that, and also bringing every game out on PC as well. There is no reason to either own an Xbox or buy games. I would have absolutely bought Starfield at full price if not for Gamepass.

This is the perfect example why GP is a cancer for video game industry.

 

[Griffon]

Doesn't matter if it comes from MS or Amazon or Sony, or whatever. Renting sub services are a blight. Authors and devs are getting fucked in the ass by gatekeepers and content gets shittier and shittier. It has no place in this industry.

Mega success like Baldur's Gate 3 and Vampire Survivor and many many other surprise hits would never have made it under such a system.

 

[Majukun]

If every game's value is tied only to its ability to drive subscriptions, what happens to the traditional gaming market? Microsoft once praised the idea that Game Pass would offer players more variety, but if this trend continues, it could end up stifling the very creativity and variety it promised to champion.

The real danger is if developers start crafting games not out of passion or creativity but out of a need to fit a 'subscription-friendly' mold. We've seen how this can play out in other media, with unique ideas often sidelined for 'safe bets' that guarantee views or plays.

i'm sorry but, what?
that's the opposite. the safety net of gamepass allows developers to be more creative because as long as MS gets their brownie points, the devs are already making their money without selling a single copy, alowing them to be creative without worry on how to keep the lights on.
On the other side you have a retail market that is as trecherous as ever for a smaller developer, consumed by an endless cycle of sequels and incredibly expensive AAA, with the occasional indie success story not silencing the numerous other devs struggling to find an audience.

 

[rofif]

nah. The problem is both

 

[Clear]

Seriously, how do people think the economics of GamePass work? How does it magically create this "better deal for gamers"?

The only difference between it and and a standard retail model is that its on MS to divvy up the money on your behalf. Which pretty obviously means that people with the most "valuable" content should get a bigger bag than those who don't.

In practice all that's changed is that you -the subscriber- are surrendering your right to support the developers and the work you like, and letting MS make those decisions for you! The people who make the product still need to get paid, and of course MS needs to get paid in order to support the service platform.

So, the obvious question is where does this extra "value for money" come from? Someone, somewhere, is taking a hit to their bottom line to support this better deal.

You think MS are going to subsidize things forever because they care about you? While they are building their userbase, sure, the advantages to perception and optics make them taking a hit somewhat worthwhile... but in the long-term they are going to want to cash out on their investments.

And when that happens, what do you think that's going to look like?

 

[digoutyoursoul]

For all their spending power, Xbox should be doing better. I don’t agree with those who say they can’t compete with Sony and Nintendo, I believe they can, if the right people are there and they are allowed to do the job necessary. That’s obviously a big if.

Games first, not services and hardware first. Make the best content possible (I know that’s a lot easier said then done) and the rest will compliment that.

How many times have Spencer and co talked about how they are learning and listening to feedback? Who are they listening to and why, after two decades in the business, do you still have to proclaim you are learning? People forget these folk are being well paid for all of this.

Whilst the other two have recognisable execs and faces to their brand, more often than not their products speak for themselves, which is how it should be. Microsoft/Xbox make it more about themselves , the execs and their services and quite frankly it’s fucking tedious.

I really thought they were on to something with the OG and the early years of 360 despite RROD but I got badly wrong and I hate saying that.

 

[ShadyAcshuns]

Who the fuck actually cares if GP is sustainable? Share holders. Non-gamers. Fanboy factions. If one can play a game they're interested in for just $11 instead of $70, it's a win for the consumer. There's nothing else to be said on the matter.

 

[Unknown Soldier]

Oh shit did I make a new thread format?

And my initial take is: Will investors start demanding actual numbers like you mention here? How long can MS get away with not only not reporting Gamepass subs, but not even game division profit? Crazy to me.

I'm an actual Microsoft shareholder and the answer is Never.

As long as Windows and Office and Azure keep printing money until the end of time, no one's going to give a shit about tiny irrelevant projects like Surface and Xbox.

 

[T-0800]

That's obviously not true when you have scenarios like Cyberpunk 2077 or No Man's Sky where the games were released in unacceptable condition and remained so for many months after release until patches and major updates were made available.

It is true that has become more common. But we are talking about the traditional model. Emphasis on traditional.

 

[Gavon West]

Nah. I would still not like it even if other companies do it.

It’s simply unsustainable. Xbox is actually the only one capable of doing gamepass because of Microsoft and still it isn’t as good as what it was envisioned.

You underestimate the amount of investment needed for a loss leading strategy like this to be pulled off.

Still not as good as what was envisioned? How do you mean exactly? 30+ million subscribers (and growing) isnt good?

 

[Victor Omega]

I'm loving the Xbox defender and and the whataboutism Sony damage control. Keep it coming

At the end of the day It's inevitable that MS will make gaming a subscription industry, like Microsoft 365 like Azure.

The problem is they will take the Netflix / streaming route in by devaluing game based on how well they pull in new subscribers, reducing all creativity in the industry.

They see their own arrogance in buying up studios, outselling Sony and using their wealth to buy out Nintendo share as a savior of gaming. All we will accept it.

 

[Ozzy Onya A2Z]

Looking at sustainability and variety of content you point out, I'd say Netflix delivered that in spades, if you want to look at it from an industry standpoint once could very much argue more content is being produced by more types of studios/people/audiences and delivered to them in more ways than ever before; compared to say TV, cable, Hollywood etc. Given the variety of titles on Gamepass vs say Nintendo or Sony, objectively speaking you're just wrong. More indie titles, more AA studios, more countries with more devs getting games out, more GP devs have a second and third release as well as grow as a studio.

Concern post is without the need for concern.

 

[fallingdove]

You're obviously not very informed about this issue at all.

https://www.thesixthaxis.com/2022/1...ces-revenue-but-growth-is-slowing-on-console/

"Speaking at WSJ Tech Live (as transcribed by The Verge’s Tom Warren), Spencer said, “Game Pass as an overall part of our content and services revenue is probably 15 percent. I don’t think it gets bigger than that. I think the overall revenue grows so 15 percent of a bigger number, but we don’t have this future where I think 50–70 percent of our revenue comes from subscriptions.”

Where have you been the last few days? Phill, behind closed doors has suggested that the future of Xbox is highly dependent on GamePass.

I don’t know how anyone could trust the bullshit PR that Phill spins after all of the contradictions in his leaked emails.

 

[Humdinger]

That's correct. From the leaked emails it seems they measure this by average hours played for a game. Now imagine a 10 hour single player game that costs $200M vs a multiplayer GaaS game.

Right. Very different calculus. That's part of what I mean. Measuring "success" becomes more ambiguous.

It's probably not as hard as it seems, number of downloads and hours played is probably a very clear indicator of success. Might even be easier to tell than raw sales numbers on a traditional title. And no doubt the benchmark of dcpectation is measured by the development costs and or cost paid to get the game.

Yes, that's one simple way to measure success, and it's one MS likes ("engagement"). But Phil also said MS needed to increase GP subs, by a substantial margin, or else bad things would happen. Granted, that was talk to the regulators, so no doubt he was exaggerating the precariousness of their position. But there must be some truth to it. If GP numbers do not climb, that would be a bad thing. So, a game's ability to get people to sign up for GP must also be part of how success is measured. And yet, that is a difficult thing to measure, for most games. So, that would make it more ambiguous, too.

 

[ReBurn]

Game pass is awesome. I don't care if Microsoft ends up going out of business to deliver games for me to play.

If Microsoft would stop being Microsoft and get a Microsoft lifer out of the Xbox driver's seat they might be able to tailor the message around it into something worthwhile. A lot of people don't care if they own nothing as long as they're having fun. But fun isn't really part of the marketing any more and Microsoft stopped trying to make Xbox cool a long time ago.

 

[Sid Of Bee]

Gamepass is pretty great. Best value in gaming IMO. Maybe both business models can coexist. But if everything goes digital, streaming services seem to be the answer.

 

[ShadyAcshuns]

Game pass is awesome. I don't care if Microsoft ends up going out of business to deliver games for me to play.

If Microsoft would stop being Microsoft and get a Microsoft lifer out of the Xbox driver's seat they might be able to tailor the message around it into something worthwhile. A lot of people don't care if they own nothing as long as they're having fun. But fun isn't really part of the marketing any more and Microsoft stopped trying to make Xbox cool a long time ago.

STOP HAVING FUN and focus on the money! Whatchu thankin?

 

[Bumblebeetuna]

My thought after reading the OP:

I’ll reply with these questions:

1. How exactly is Netflix harming the movie industry? I understand that there are a ton of streaming platforms now, but there’s also a ton of great content now. Also, an industry being “harmed” is not inherently bad.

2. What does Netflix or MS hiding numbers from the public have to do with how creators feel? Do you really think they don’t get concrete numbers on engagement or downloads or streams of their titles?

3. What does “games designed to push subs” even mean? Is this just a regurgitated version of the “quantity over quality” nonsense we’ve heard about GamePass for years now? Is it finally going to come true? Because to me, “games designed to push subs” just seems like another way to say “games designed to be great”. And what is the difference between doing that on a sub versus doing that for a game that ends up on a shelf day one for $70?

4. How does your logic here deal with the fact that all of the games on GamePass are available outside of the service on day one? That isn’t the same as Netflix. I can go out and buy Starfield for $70. Next month I can buy Forza for $70 or just download it on GamePass. Was Turn10 not concerned about making a game worthy of a $70 purchase?