Question is how much more pervasive will it get. Will games start having commercial breaks?
-
Ever wanted an RSS feed of all your favorite gaming news sites? Go check out our new Gaming Headlines feed! Read more about it here.
-
We have made minor adjustments to how the search bar works on ResetEra. You can read about the changes here.
Business Insider: Video game makers are worried that the industry is adopting the Netflix model
- Thread starter stormfire
- Start date
Question is how much more pervasive will it get. Will games start having commercial breaks?
There's no revenue stream being cut off though...
There isn't even monetary incentive to want to cut of other streams, because services like gamepass feed users too the other streams.
You've said a lot of things that show a general lack of understanding of the business. You implied that gamepass losses were contributing to a bleeding money situation, that would result in the division getting shut down.
Swift_Gamer said:
1) Gamepass doesnt need to generate revenue to "recoup its budget" because it feeds high margins revenue streams that generate more than what Gamepass costs. It's a loss leader
2)your math is very poor. Microsoft makes ALOT of money when 3rd parties sell games and DLC via the xbox store. So much so that their 1st Party software revenues are a drop in the bucket. This is why they are willing to release their AAA games day1 on gamepass - because doing so drives more users to the subscription which leads to more engagement and more software sales.
3) sub revenues don't need sustain to the AAA model... so this point is moot. AAA is sustained by various other revenue streams. And there's no indication that these game subscriptions lead to fewer sales. The opposite is true. Especially since most games on the service arrive a while after release and get a boost in sales while on the service. Cost of AAA development is justified by its impact on growing the platform.
4) the division isn't bleeding money, and when it WAS bleeding money it didn't get shuttered...so why the concern now when xbox is actually turning a profit?
5) your wrong, the division didn't get out of the red until this generation.
Last edited:
I think there's no chance that big developers let their games go on these subscription services at launch, surely they'd be losing money?
I boycotted Xbox this gen because Don Mattrick was an idiot; however, although GamePass would be great for me to catch up on Microsoft first party titles, I think I'd rather just continue my 'pay as you go' approach to games once I have.
I boycotted Xbox this gen because Don Mattrick was an idiot; however, although GamePass would be great for me to catch up on Microsoft first party titles, I think I'd rather just continue my 'pay as you go' approach to games once I have.
MS went this route partly because those direct sales weren't to their satisfaction. So, I'm not sure how that would flip back around to direct sales balancing out when the whole point is how cheap the sub is. Direct sales will continue to go down. People sub for cheap, get access to a bunch of games and then enjoy. They aren't going to then spend a bunch of money that would have been a direct sale before this.
Granted, DLC, MTX, etc... certainly helps but I don't think that is enough to make up for cutting out all that upfront revenue. Especially for AAA games.
Since you're mixing things up and putting words in my mouth, I see no point in keep talking to you about this.
When "adapting" means that most of your favourite gaming genres and IP die in favour of sanitized, MT-filled, focus-tested games designed to be fun for 5 mins but with no depth (in order to make them stand out on a crowded subscription service), I think calling it a non-issue is optimistic at best and entirely a myopic perspective at worst.
I'm so confused by this whole argument when we have had steam over a decade release THOUSANDS of games over a weeks time at times and have crazy sales that price games for pennies on the dollar. And yet people praise steam on here so much so they openly speak out against other store front launchers, and PROMOTE steam deep sales in new threads. Yet everyone turns a blind eye to say a netflix model is what will devalue games..... really????
How is PS Now working out for SONY? It's not comparable to standard gaming, I think gaming could transition into streaming like Netflix or Hulu but not many have done it.
Steam has the launch at regular prices and then does the sales. GP cuts out the launch at regular price entirely.
If this happens game development models will have to design for subscription service in mind. That means they'll treat games like seasons of a tv series more than ever and will have season passes or season exclusive content seperate from base models of the game that are on game pass style services.
In that environment game developers more than ever will have to design titles as a platform for continued content over stand alone experiences.
In that environment game developers more than ever will have to design titles as a platform for continued content over stand alone experiences.
Third party games rarely launch day 1 on gp, in fact only ms 1st typically does aside from indie games. But your arguement is it's okay to devalue a 60 dollar game to a few dollars as long as it's been a couple of months?
Also reporting has shown game pass reingauges interest in a game long after its had its initial release spike and subsequent dip in sales.
I didn't say anything about my argument. I was showing you why your comparison was faulty.
But I just explained to you why other than microsoft 1st party that arguement isnt really valid for day 1....
Who says direct sales weren't satisfactory? Attach rate is as good as ever. Digital has brought better margins than everyt. MS went this route because they saw an opportunity to differentiate themselves and carve out a profitable niche. Microsoft has made a lot of money via direct sales, theres no sense that they are moving away from that model.
How can direct sales "continue to go down" when they arent going down in the first place?
Microsoft hasn't pivoted away from direct sales, they've added a subscription service that that lowers the cost barrier to entry to their ecosystem. The hope is that more people will join the ecosystem now and then buy things later
Im not sure what you be the whole point being how cheap the sub is...that's the whole point to consumers. But to Microsoft the whole point is that it's value presents an enticing entry point into their ecosystem which has various other hooks that bring profit.
People sub for cheap, and get access to a catalog of games that have mostly already been sold directly for a while and wouldnt be seeing many more sales otherwise. These games get on Gamepass & get a new lease on life: arrival is a marketing op, MP population gets boosted, DLC gets sold and new players get introduced to franchise they might have missed. Then the game is removed from the service, which prompts people that like it to purchase it.
As far as the loss of revenue from 1st AAA games - the name of the game is 3rd party royalties. Exclusives exist to give people a reason to choose one platform over another, and the more people choose a particular platform, the bigger that platforms opportunity to collect 3rd party royalties. MS feels like sacrificing some AAA direct sales will be offset by more people people coming to the platform and ultimately, more royalties.
You're still confused.
I'm not debating anything with you. I'm clarifying the article because you made it seem like it was about deep sales on games. It is about losing upfront revenue at launch. That is why I said your comparison didn't work because Steam hasn't axed upfront revenue.
They moved this way because the traditional route wasn't working for them. If MS games were selling several millions close to launch like some Sony and Nintendo games, they wouldn't be doing this. Or at least nowhere near this extent.
They very clearly are.
UK - Gears 5 Sold a Quarter of Gears 4 Sales (Boxed Sales)/Digital and GP Majority By Far; BL3 Biggest Box Launch of the Year (Less than Half of BL2)
- It seems MS will hope GP will make up for the revenue loss in the short term. AAA games are expensive and obviously losing those $60 buys will sink revenue, but it is all so GP revenue can explode years from now. I just wonder if things like people only subbing when the price drops, or just...
www.resetera.com
Physical and digital is much lower compared to previous releases because GP is siphoning those buys. It isn't balancing out.
MS wants direct sales to remain relevant, yes, but I think the hard GP push is having the opposite effect.
No it doesnt.
The vast majority of games on gamepass already launched at regular price, months or years before they arrive on the service.
Of the few games that hit GP on day one, 100% of them are still offered for regular price for non-subscribers
Because it just started obviously. This article is speaking to what would happen as we go along and more games would come day 1 launch.
Which doesn't matter since people are switching to GP and it doesn't balance out. That is the point.
You're still confused.
I'm not debating anything with you. I'm clarifying the article because you made it seem like it was about deep sales on games. It is about losing upfront revenue at launch. That is why I said your comparison didn't work because Steam hasn't axed upfront revenue.
They moved this way because the traditional route wasn't working for them. If MS games were selling several millions close to launch like some Sony and Nintendo games, they wouldn't be doing this. Or at least nowhere near this extent.
They very clearly are.
UK - Gears 5 Sold a Quarter of Gears 4 Sales (Boxed Sales)/Digital and GP Majority By Far; BL3 Biggest Box Launch of the Year (Less than Half of BL2)
- It seems MS will hope GP will make up for the revenue loss in the short term. AAA games are expensive and obviously losing those $60 buys will sink revenue, but it is all so GP revenue can explode years from now. I just wonder if things like people only subbing when the price drops, or just...
Physical and digital is much lower compared to previous releases because GP is siphoning those buys. It isn't balancing out.
MS wants direct sales to remain relevant, yes, but I think the hard GP push is having the opposite effect.
Gears 5 sold more than Gears 4. Gears 5 launched on gamepass, gears 4 didn't
Forza Horizon 4 sold more than Forza Horizon 3. Forza 4 launched on games pass. Forza Horizon 3 didn't
Same story for State of Decay 2.
Anyway, the argument isnt that a first party game on gamepass will be offset by sales of that same game in the store. The argument 1st party games on gamepass drives people to the service, which presents so many opportunities for new sales that it offsets any upfront losses.
Last edited:
Looking at the long term, it was always a questionable claim, one to take with a grain of salt.
I'm still predicting that if this model takes a hold, it's going to affect the quality of a lot of titles in the long term.
Why put the effort necessary to make a single product a timeless classic when you can rely on a fraction of that budget to just produce something that it looks good enough to draw in new players at a first sight, but falls short few hours down the line?
The article is about a doomsday scenario that shows no signs of ever occurring. The service has been out for 3 years... and publishers have been taking the same approach to supporting the whole time. When are signs of these dooms day trends supposed to start presenting themselves, because as of now, there are none.
Also it does balance out... in fact, more than balances out. Time and time again its proven to work in favor of direct sales.
This fear doesn't really jibe with the reality of creating a subscription service that customers value.
Loading the service with nothing but forgettable games wouldn't attract many subscribers.
The top games on gamepass at this moment are GTAV, Minecraft, Forza Horizon 4, Rocket League, Mortal Kombat X, Human Fall Flat, The Witcher 3...
Recently added: a plagues tale, yakuza 0, kingdom hearts 3...
Loads of critical acclaim
If you're making a low effort game, who's to say such a service would even entertain the idea of paying you to license your game?
Last edited:
That's just because you are reasoning in terms of having a binary choice between the two extremes "great games" and "complete shit", when the point is that "just good enough, I guess" will be more than enough to work with a subscription model, without going the extra mile to load that single title with long term value.
No, Im saying that there's no indication that low effort or mediocre games are enough to keep this ship afloat. So I disagree I devs will be less motivated to make excellent games.
What is your evidence "that just good enough, I guess" will work for the subscription model?
If your a developer, how sound of a business plan is it to make a game that is "just good enough, I guess" and hope Microsoft chooses it for gamepass?
If your Microsoft, how sound of a business plan is it to shop for "just good enough, guess" 3rd party titles, and hope these are, in fact good enough to draw subscribers.
Part of the reason theres hype around the service is because it's filled with excellent games.
Microsoft is throwing the entire weight of their first party portfolio behind it while also signing best in class 3rd party titles to it. So where do you get the notion that mediocrity is being incentivized?
Same as ever, the better the game, the more there is to gain for all parties involved.
Last edited:
The Steam pricing model is: "make a one-time purchase of a content license".
The Netflix pricing model is: "subscribe to access all content on the service"
You are confused: the pricing models are quite different.
I can't have the "evidence" you are asking for since we are not (far enough) in that timeline yet.
it's my personal prediction: it just CAN'T have a good effect on the quality/amount of content of individual titles in the long term, especially IF it becomes the predominating distribution model.
It makes absolutely no logical sense to even guess it could.
If the devs have a good motive to compete within a gamepass with other games,for example a better game gets more downloads or playtime,thus gets payed better by MS,then there won't be a problem
If Game Pass serves as a relief where if you pass a certain(medium) quality threshold,then you are good to release it and guaranteed a certain paycheck, we will have even more mediocre games in my opinion
In Netflix like services we have seen some good stuff among a myriad of bad stuff imo,so I think we should avoid that and strive for more GOOD games,even if we get less in total . We can't play every game anyhow due to time constraints,so...
How far into the timeline do you suspect we'll have to be before for Microsoft starts preferring to add mediocre games over adding really good ones?
How far into the timeline until creatives no are no longer motivated by creating and are instead motivated by crossing some imaginary minimum qualitative threshold that shows no signs of existing.
Even if this became the predominant distribution method (it wont) why do you think mediocre games would be enough to hold subscriber interests, when to date, high quality and/or content heavy games appear to be the biggest draw.
Usually such predictions are the result of observing a trend. But yours suggests the exact opposite of current trends will become the prevailing norm.
Last edited:
I think if I was a developer working at any of Microsoft's studios I'd be incredibly insulted by this post. You think all these talented people are just going to go "fuck it I don't really care that much about how good our game is since it's on Game Pass"?
Subscription services require both the headline-grabbing premium titles and incredible diversity in their offering of niche titles. One drives new subs and the other maintains existing subs.
Netflix has been great for people in the film and television industry and for fans of various genres that were not being served under previous distribution models.
It's actually been really surprising to me how many developers and publishers have been agreeing to this. Though I imagine Microsoft paid them a ton of money to get their games on the service, it always seemed like a short sighted decision since they're devaluing their own games.
No, but nice try.
I think they'll just go with "Fuck it, the "be part of a live service fee" just doesn't pay enough for us to go the extra mile with this and be sustainable".
And feel insulted all you want for all the damn I give, by the way.
Film studios have the benefit of Cinema and traditional distribution platforms to make nice profits (often making back multiple times their production costs before ever seeing a sub-service listing).
In a subs only world, games of the scope, scale and budget of GTA simply wouldn't and couldn't exist.
Last edited:
I believe it absolutely could. But I don't believe a subscription only world will ever be a thing.
I believe I can fly, but it doesn't make it meaningful in reality.
It absolutely couldn't in a sub-only world. And I agree that a sub-only world is very unlikely for gaming, however, the concerns raised in the OP are expressed on this basis and provide the context for the discussion of this thread.
Yes, I'm sure the creatives over at Ninja Theory are really worried about the sustainability of Game Pass while being owned by one of the biggest companies in the world to the point where they'll not longer want to produce good games.
Finances are for the executives to worry about, if you're in a good work environment and getting paid I don't see why you'd want to be so shit at your job. I don't see any reason MS bought studios like Obsidian and Double Fine just to make them do shoddy work.
Yeah, because everyone out there is a fucking first party studio with absolutely no concern about finances.
Can you give sources to all this Xbox profit and loss data you keep citing for this generation? As far I remember MS hasn't released a full P&L for Xbox in years. Where are you pulling your software sales figures for Xbox unit software sales also?
We'll have to wait and see how things turn out, but so far Microsoft has vastly improved it's first party offering by buying/creating several new studios. They seem to be more interested in owning and creating in-house content ever since they started down the subscription path and it's hard to imagine them having so many new studios will somehow result in them ending up with a less impressive first party.
Now if what you meant when talking about quality (or "timeless classic" in one of your previous posts) was that we would see fewer AAA prestige projects and more AA or smaller games, then I would probably agree, though I'm not convinced that's necessarily a bad thing, considering what AAA budgets do to game design and creativity.
Last edited:
Where does humble choice fit in the new paradigm? I am not particularly interested in game pass but subscribed to HC precisely because I can keep the games after cancelling.
How is a developers devaluing their games if they are getting a fat check from MS, generally well after the games sales have peaked?
Extracting more money out of the work is the exact opposite of devaluing.
Former Xbox chief Robbie Bach wrote a book chronicling xbox and xbox 360. He stated that OG Xbox lost 5-7 billion while xbox 360 netted a couple billion. Earnings reports over that timespan show the division as still being several billion in the whole at the as 360 era winded down to a close. Another user provided a chart in this thread. Nadella has since been quoted that the gaming business is profitable, and we see the quarterly revenues being much larger now than ever thanks to digital and third party sales.
damn dude, do you post anything positive? Whew. And I thought I was intense.
Games will still be made, players will still play. We'll see what happens
The 3rd parties are getting paid extra money so that their old games can appear on the service, revitalizing their playerbase, and boosting sales opportunities...
That's financially concerning, how?