Gamepass Business Plan.

[Iron Horse]

Something interesting occurred to me the other day. A lot of video games have had a failed business plan lately. This failed business plan seems to be part of an entertainment industry philosophy.

Starfield and other similar games, they launch. A game launch is a big deal. There are Youtube and Twitch people looking to cover it. The game gets a lot of attention. There may be some excitement about it one way or the other. They put their $60 game on Gamepass where people don't have to purchase it. That is kind of like what HBOmax was doing a few years ago where "Dune Part 1" and Wonder "Woman 2" went straight to HBOMax.

This looks to be a faulty business plan. I don't know that anyone else has covered it or has information on the numbers at this time.

A $60 AAA game, that launched and was not on gamepass, would potentially make more money in the first few years. Some amount of time should go by till it is on gamepass? It is hard to account for a games reception and popularity when it goes straight to gamepass. Someone playing the game was getting a huge discount, and playing other things as well.

[Starbug]

Both gamepass and epic games stores are running a loss leader model to attempt to capture some of valves market share. It probably isn't sustainable. But given both epic and Microsoft are cash rich, it can continue for some time yet

It will be difficult but not impossible to erode valves market share

[Iron Horse]

Hopeful it destabilized Microsoft, and the Federal Government gets them for Monopolistic business practices. That is the same type of tactic that Walmart used to run small mom and pop grocers out of business.

[Gagdad⚫͗̃́̈̿̾̈͂̈́̏̏]

Yea, SF is kinda the unloved ugly duckling here. MS gives it away for one dollar, and Valve could not care less about it

MS has one big problem, which is that nobody likes it. cry about the cut he takes all you want, people like gabe newell

[kdodds]

They gained and retained 9M subscribers with the release of Starfield. I'd hardly call that "faulty". The reliance is on the majority of subscribers being average players who purchase 1-2 new games per year. They're not losing money.

[Iron Horse]

Originally posted by kdodds:

They gained and retained 9M subscribers with the release of Starfield. I'd hardly call that "faulty". The reliance is on the majority of subscribers being average players who purchase 1-2 new games per year. They're not losing money.

That is hard to substantiate. It is hard to measure.

Are you talking about 15 year old's from middle class families being hit by inflation? Are you talking about someone who plays Madden and sports games almost exclusively who was on gamepass?

Men, they tend to have hobbies. Some men are car guys. Some guys are gun guys, and collect guns. Some guys are gamers. A gamer possibly has a huge steam library. They are a different entity.

It is easy to measure sales of a $60 game. Given someone was on gamepass, they were paying a subscription, and may have been there for a variety of reasons. We don't know how many games they would actually buy, nor how long they would stay on gamepass. It is hard to measure.

[Starbug]

Originally posted by Iron Horse:

Hopeful it destabilized Microsoft, and the Federal Government gets them for Monopolistic business practices. That is the same type of tactic that Walmart used to run small mom and pop grocers out of business.

I don't imagine the current administration will be making a concerted effort to combat the abuses of big business. Doesn't happen under a right wing oligarchy.

[Raven]

Your forgetting one important factor. Shareholders.

Shareholders often value subscription-based businesses more highly because of their predictable revenue streams, strong customer retention, and growth potential.

Example: Companies like Adobe and Microsoft transitioned to subscription models (Creative Cloud, Microsoft 365) to increase profitability and market valuation. This also applies to services such as gamepass.

Overall, subscription services generate more profit over initial cost than 'one-of' sales.

[JacEEEBABY]

Speaking of the Gamepass business model, subs are way down compared to this time last year. oopsie

[Gagdad⚫͗̃́̈̿̾̈͂̈́̏̏]

Great, now we have the PR numbers for gamepass that Microsoft puts out and probably includes everyone who used game mode on a windows PC in the last 5 years. thanks

[kdodds]

Originally posted by Iron Horse:

Originally posted by kdodds:

They gained and retained 9M subscribers with the release of Starfield. I'd hardly call that "faulty". The reliance is on the majority of subscribers being average players who purchase 1-2 new games per year. They're not losing money.

That is hard to substantiate. It is hard to measure.

Are you talking about 15 year old's from middle class families being hit by inflation? Are you talking about someone who plays Madden and sports games almost exclusively who was on gamepass?

Men, they tend to have hobbies. Some men are car guys. Some guys are gun guys, and collect guns. Some guys are gamers. A gamer possibly has a huge steam library. They are a different entity.

It is easy to measure sales of a $60 game. Given someone was on gamepass, they were paying a subscription, and may have been there for a variety of reasons. We don't know how many games they would actually buy, nor how long they would stay on gamepass. It is hard to measure.

I'm talking about reported subscriber number differences that went from 25M in 2022 to 37M in 2023 and fell to 34M in 2024. There's nothing more left to "substantiate", those are the official MS released numbers. 12 x 12 = $144 per subscription, per year. AAA game = $70. The average GAMER buys 3-5 new games per year. The average PERSON, significantly less. It washes to about 1-2 games per year, average, with only 33% consisting of self-described "avid gamers". So yes, they've got it covered. They also now have 9M new users on a "free to play" platform via subscription who can be enticed into purchasing new games, in-game purchases, merchandise, etc.

[lizzo(overturned bans x 69)]

Originally posted by Gagdad⚫͗̃́̈̿̾̈͂̈́̏̏:

Great, now we have the PR numbers for gamepass that Microsoft puts out and probably includes everyone who used game mode on a windows PC in the last 5 years. thanks

its hilarious the gatekeepers are still talking about the gamepass pr numbers. pretty much explains the state of this failed game.

[Gagdad⚫͗̃́̈̿̾̈͂̈́̏̏]

Getting paid to lick corporate boot by telling lies is a sad fate that many people suffer. Doing it for free though? There aren't many that love the taste that much

[Iron Horse]

I'm talking about reported subscriber number differences that went from 25M in 2022 to 37M in 2023 and fell to 34M in 2024. There's nothing more left to "substantiate", those are the official MS released numbers. 12 x 12 = $144 per subscription, per year. AAA game = $70. The average GAMER buys 3-5 new games per year. The average PERSON, significantly less. It washes to about 1-2 games per year, average, with only 33% consisting of self-described "avid gamers". So yes, they've got it covered. They also now have 9M new users on a "free to play" platform via subscription who can be enticed into purchasing new games, in-game purchases, merchandise, etc.

A lot of that is corporate shenanigans, and fuzzy numbers, quite possibly paralleled by the Corporate people over at HBOmax, a few years ago, where they were putting movies directly to streaming.

There may be a lot of factors in the number of subscribers on a Gamepass. It is hard to accurately predict.

The game industry came out with a lot of duds recently. Big losers. Instead of paying a monthly subscription for game pass, some gamers may have decided to play Stardew Valley, or an Old SNES game they can play for free. On the Steam top most played list, there is often a lot of Free to Play games.

Given Corporate weirdos do not know their audience, do not understand their consumers, all their numbers and projections may be really off. This is a big philosophical problem that has been plaguing the World Economy in sectors outside of gaming even.

[kdodds]

Originally posted by Iron Horse:

I'm talking about reported subscriber number differences that went from 25M in 2022 to 37M in 2023 and fell to 34M in 2024. There's nothing more left to "substantiate", those are the official MS released numbers. 12 x 12 = $144 per subscription, per year. AAA game = $70. The average GAMER buys 3-5 new games per year. The average PERSON, significantly less. It washes to about 1-2 games per year, average, with only 33% consisting of self-described "avid gamers". So yes, they've got it covered. They also now have 9M new users on a "free to play" platform via subscription who can be enticed into purchasing new games, in-game purchases, merchandise, etc.

A lot of that is corporate shenanigans, and fuzzy numbers, quite possibly paralleled by the Corporate people over at HBOmax, a few years ago, where they were putting movies directly to streaming.

There may be a lot of factors in the number of subscribers on a Gamepass. It is hard to accurately predict.

The game industry came out with a lot of duds recently. Big losers. Instead of paying a monthly subscription for game pass, some gamers may have decided to play Stardew Valley, or an Old SNES game they can play for free. On the Steam top most played list, there is often a lot of Free to Play games.

Given Corporate weirdos do not know their audience, do not understand their consumers, all their numbers and projections may be really off. This is a big philosophical problem that has been plaguing the World Economy in sectors outside of gaming even.

ROFLMAO. MS is a public company. "Corporate shenanigans" that affect trading are punished, harshly, by the SEC. MS has no reason to do this. They could, as easily, shutdown MGS, XB, etc., and still be one of the largest and most profitable companies on the planet. There is absolutely no reason to believe, therefore, that the numbers are anything but hard data.

Gamers' overstating and overthinking their own self-importance and expertise is the main issue in the gaming industry, not "recent duds". And yes, your "rebound" drop offs were already accounted for, as I already stated, MS gained 12M subscribers, gross, in the year of Starfield's release. 9M of those 12M stayed. You're not making your point, you're making mine.

[Mick Savage]

Because the devs knew this game wouldn't sell well, so it went straight to the bargain bin.