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Game Pass is not profitable yet - Tom Warren

Hezekiah

Banned
Doesn't change the fact that comparing Gamepass to PS+ is pointless.
Also with that tiny subscriber number we have no idea if PS Now is profitable either.
Yep but ultimately the costs are far lower, and even then there are people paying less for GamePass.

The whole reason GamePass offers the value it does currently is because Microsoft is playing catch-up in a big way. At the end of the day they think they can persuade people to spend more on subscriptions plus games/add-ons than they were previously. But it's a long way from profitability.
 
That division includes other stuff though so how is that comparison being made?
No, it doesn't include other stuff.
Also if you're talking about 'making more money' surely you're talking about profit??
We're talking about revenue here since we don't know the profit numbers.
Seems like a statement without any evidence to back it up.
There is evidence, I provided it in the last post.
 

Riky

$MSFT
Yep but ultimately the costs are far lower, and even then there are people paying less for GamePass.

The whole reason GamePass offers the value it does currently is because Microsoft is playing catch-up in a big way. At the end of the day they think they can persuade people to spend more on subscriptions plus games/add-ons than they were previously. But it's a long way from profitability.

The price of entry is far lower too, so could be loss making for all we know.
You have the figures for how far Gamepass is from profitability? How do you know it's a " long way from profitability", it could be but we don't know.
 

Hezekiah

Banned
No, it doesn't include other stuff.

We're talking about revenue here since we don't know the profit numbers.

There is evidence, I provided it in the last post.
It includes Microsoft Surface and PC accessories.

Right so if we don't know profit numbers for one side of the equation, don't you think it's a pretty stupid statement to talk about which division makes more money comparatively 😁.
 

Tschumi

Member
I think it is a bit weird that people keep bumping a thread from May? It's pointless, i might wanna know how game pass is doing now, not how it was doing in May...
 

Stuart360

Member
Although its cute to see so many people 'concerned' over Microsofts financies, i'm sure they have thought all this through with Gamepass, and realize you have to 'speculate to accumilate' with services like this.

I think its only a matter of time, and not a large amount of time, before we get the '30mil subs tweet'. I'm sure they are going to do it when landmark numbers are reached (30mil, 40mil, etc). I get because they havent updated the numbers since hitting 20mil subs that 'that must mean its failing' but imo they are only going to inform us when these 10mil landmark numbers are hit.
 
It includes Microsoft Surface and PC accessories.

Right so if we don't know profit numbers for one side of the equation, don't you think it's a pretty stupid statement to talk about which division makes more money comparatively 😁.

No, gaming does not include Microsoft Surface and PC accessories, stop with this false claim....
You'll find here the description of how is divided the More Personal Computing :

Our More Personal Computing segment consists of products and services that put customers at the center of the experience with our technology. This segment primarily comprises:
  • Windows, including Windows OEM licensing and other non-volume licensing of the Windows operating system; Windows Commercial, comprising volume licensing of the Windows operating system, Windows cloud services, and other Windows commercial offerings; patent licensing; Windows Internet of Things; and MSN advertising.
  • Devices, including Surface and PC accessories.
  • Gaming, including Xbox hardware and Xbox content and services, comprising digital transactions, Xbox Game Pass and other subscriptions, video games, third-party video game royalties, cloud services, and advertising.
  • Search advertising.

And here you have the results (https://www.microsoft.com/en-us/investor/earnings/FY-2021-Q4/IRFinancialStatementsPopups?tag=us-gaap:SegmentReportingDisclosureTextBlock&title=More Personal Computing) :

zrrvGxS.jpg


Devices are not mixed with Gaming, so clearly not with Xbox...


 
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Duchess

Member
I expect a PS Premium where they roll PS+ and PS Now into one service, they might even scrap PS Now at that point as an option.
PS Premium? Nah, that's a boring name.

PS Ultimate or PS It's Over 9000! would be better.

Actually, given Sony's current track record, PS+ Director's Cut will probably be what they go with :)
 
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Heisenberg007

Gold Journalism
Although its cute to see so many people 'concerned' over Microsofts financies, i'm sure they have thought all this through with Gamepass, and realize you have to 'speculate to accumilate' with services like this.

I think its only a matter of time, and not a large amount of time, before we get the '30mil subs tweet'. I'm sure they are going to do it when landmark numbers are reached (30mil, 40mil, etc). I get because they havent updated the numbers since hitting 20mil subs that 'that must mean its failing' but imo they are only going to inform us when these 10mil landmark numbers are hit.
They shared it at 18 million, and before that, it was 15 million. Never announced 20 million (so we don't know if they reached it or not). But they are not really doing the announcements at 10-million marks it seems.
 
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Stuart360

Member
They shared it at 18 million, and before that, it was 15 million. Never announced 20 million (so we don't know if they reached it or not). But they are not really doing the announcements at 10-million marks it seems.
Well we will see but i bet we dont get any numbers until they hit 30mil.
 

MrFunSocks

Banned
No, gaming does not include Microsoft Surface and PC accessories, stop with this false claim....
You'll find here the description of how is divided the More Personal Computing :



And here you have the results (https://www.microsoft.com/en-us/investor/earnings/FY-2021-Q4/IRFinancialStatementsPopups?tag=us-gaap:SegmentReportingDisclosureTextBlock&title=More Personal Computing) :

zrrvGxS.jpg


Devices are not mixed with Gaming, so clearly not with Xbox...


That guy has already tried to move the goalposts to profit now despite me clearly talking about revenue since we don't know profit.

To that guy - there's a reason I haven't replied or seen your posts ;)
 
It includes Microsoft Surface and PC accessories.
No, it doesn't.
Right so if we don't know profit numbers for one side of the equation, don't you think it's a pretty stupid statement to talk about which division makes more money comparatively 😁.
Why are you afraid of talking about revenue? I bet if this was Sony vs Nintendo, you'd say that profit doesn't matter 🤭
 

yazenov

Member
Dunno why people are sweatin here.

MS doing gamers a solid by providing a kick ass service even though it's costing them.
Its cute that you think MS is doing gamers a solid out of the kindness of their heart, like its some kind of charity.

Wait for the bait and switch if the service takes off. Its only cheap now because someone is footing the bill to hook you in.
 
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Its cute that you think MS is doing gamers a solid out of the kindness of their heart, like its some kind of charity.

Wait for the bait and switch if the service takes off. Its only cheap now because someone is footing the bill to hook you in.
I wouldn't call it chartiable, more an act chivalry during the intial courtship.

Of course the price will inevitably rise, however I would anticipate the value propsition to rise also given the investments by MS. At that point, its up to the individual if they want to continue their dalliance with GP or not.

For now though, most of us are throughly enjoying the honeymmoon period irrespective of whether MS is just doing it to get in our knickers.
 
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Hezekiah

Banned
No, it doesn't.

Why are you afraid of talking about revenue? I bet if this was Sony vs Nintendo, you'd say that profit doesn't matter 🤭
Yes it does, it's in the accounts statement.

'Afraid?' What a bizarre comment - especially when I specifically mentioned Playstation having $25bn revenue for the year Vs $15bn for Xbox and everything else they include in that segment in an earlier post. I guess you missed then when you were thinking this up in your head 😅.

Then again you're the same man middle-aged man who ran around the forum saying Ratchet, Demon Souls and Returnal 'bomba' - before being (rightly) banned 😁.
 

Hezekiah

Banned
No, gaming does not include Microsoft Surface and PC accessories, stop with this false claim....
You'll find here the description of how is divided the More Personal Computing :



And here you have the results (https://www.microsoft.com/en-us/investor/earnings/FY-2021-Q4/IRFinancialStatementsPopups?tag=us-gaap:SegmentReportingDisclosureTextBlock&title=More Personal Computing) :

zrrvGxS.jpg


Devices are not mixed with Gaming, so clearly not with Xbox...


I'm referring to profit and operating income. If you want these you have to go through the Personal Computing sector which Xbox is buried in which includes:

Windows, including Windows original equipment manufacturer (“OEM”) licensing and other non-volume licensing of the Windows operating system; Windows Commercial, comprising volume licensing of the Windows operating system, Windows cloud services, and other Windows commercial offerings; patent licensing; Windows Internet of Things (“IoT”); and MSN advertising.
Devices, including Microsoft Surface, PC accessories, and other intelligent devices.
Gaming, including Xbox hardware and Xbox software and services, comprising Xbox Live transactions, subscriptions, and advertising (“Xbox Live”), video games, and third-party video game royalties.
Search


And yes MrFunSocks MrFunSocks , referring to revenue when talking about who makes more money doesn't make sense. But at least we can see the profit margins for Personal Computing. Real helpful.

Also note you didn't reply to console hardware making money for far longer than it loses money for successful consoles. But that was a pretty dense statement too 😁.
 
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Yes it does, it's in the accounts statement.
No, it doesn't. You need to learn to read.
'Afraid?' What a bizarre comment - especially when I specifically mentioned Playstation having $25bn revenue for the year Vs $15bn for Xbox and everything else they include in that segment in an earlier post. I guess you missed then when you were thinking this up in your head 😅.
Exactly, so why move the goalposts to profit?
Then again you're the same man middle-aged man who ran around the forum saying Ratchet, Demon Souls and Returnal 'bomba' - before being (rightly) banned 😁.
Wrong again.
 
So Tom Warren's Tweet was from May.

Uncle Phil in June in an interview says otherwise:


So when we look at the economics of Game Pass, it’s not just how many games a subscriber [is] playing in a subscription and if they would have purchased those games or some number of games or what’s the trade-off on purchase versus subscriber revenue. We never really look at it that way. What we do is say are we growing the number players on our platforms and are they playing more often and from that activity we see the business grows. The number one matric that we got to see if our business is actually growing is our people playing more on the platform.

There is nothing about review scores, there is nothing about retail sales of consoles, retails sales of games. The number one sign that our platform is healthy and growing is actually engagement on the platform from players and that is what Game Pass is growing. So our business continues to grow and be profitable at Xbox and we are proud of that.

So like any other subscription service, number of users and engagement are the key factors to measure the growth of it. For Game Pass, Phil believes that the number of subscribers are “fairly large” and continue to grow. And their business continues to grow and be profitable at the same time.

So if you have also been wondering whether the service is profitable or not, you have your answer. An important thing Phil revealed here about Microsoft’s plan is that they don’t count number of sales (console or games) as the main matric to measure the growth, it’s the engagement factor that is important for their business model.

I think the above statements will suffice. Maybe....

MS's endgame is to replace most 3rd party titles in the service with it's own productions from their self-owned studios - not all but a sizeable chunk while at the same time providing as much diversity in their games as they are able to.

I guess some folks realize that microsoft of all of the console manufacturers can achieve that, having the financial ability and makes them so "concerned" about their financials and ability to achieve that - that they will fight the product (game pass) which i bet they would love to have, judging from the comments about the PS5 instant collection (which is great), but unfortunately, ultimatately hate because "reasons".

Well they are correct.

They wil be in a state of "concern" for a long time going forward.

If you think about it the more game pass grows the more devs will struggle to get a spot in that (secure financing of the game) improving quality and more exciting gaming ideas while Sony will have to offer/pay more trying to secure their timed exclusivity deals.

Yap thats it. Genious.
 
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Hezekiah

Banned
No, it doesn't. You need to learn to read.

Exactly, so why move the goalposts to profit?

Wrong again.
I didn't move the goalposts - learn to read. I've said saying one company makes more money than another 'comparatively' doesn't make sense if you don't the profit margins for half of the equation. Is it really that difficult?

You were banned after making a tit of yourself when talking about Playstation games. No amount of revisionism will change that 😂.
 
Sony sold over 1600M games for PS4, Gamepass and PS Now combined have around 25M+ subs. What is popular for console games is to buy games for PS, not game subscriptions.
Sony didn't sell 1.6 billion games on PS4, Sony AND THIRD PARTIES did. You can't keep removing the agency of 3P publishers/developers from the picture.

At most, Sony sold 18% of that figure, or 288 million. However that is not 288 million @ $60. A lot of those were sold at discounts, and some were "sold" via bundles in various PS4 SKUs. So you are probably looking at 50% (to be safe) of those having sold at full price, or 144 million.

An that is over the course of seven years, or ~ 20 milion units per year. However, that 18% figure from earlier? That's from their reported share of 1P revenue (not software unit sales) from overall PS annual revenue for 2020. So not only would that percentage probably be even lower (as an average) when speaking of what portion of the 1.6 billion come from Sony 1P software, but the percentage itself is from a completely different metric and I'm being rather generous assuming a near 1:1 ratio between 1P software revenue and 1P software units sold (otherwise if the argument is that their software unit sales were larger out of the total software units sold, then you're talking about a LOT less of those units moving at full price, or moving at discounted prices etc.).
 
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I didn't move the goalposts - learn to read. I've said saying one company makes more money than another 'comparatively' doesn't make sense if you don't the profit margins for half of the equation. Is it really that difficult?

You were banned after making a tit of yourself when talking about Playstation games. No amount of revisionism will change that 😂.

Comparatevely MS makes more money per user than Sony.

Check your revenue figures you posted in bil $ divided by users.

If MS kills gold and/or rolls it up in the game pass ultimate, sony would either have to kill their revenue from ps+ (main source) or be ridiculed.
 

Hezekiah

Banned
At least you now know that Xbox revenue is just Xbox, not Microsoft Surface (lmao).

You really want to discuss DeS sales? A game where Sony doesn't want to talk about sales numbers, one of the few games where that's the case, including Sackboy and Destruction Allstars? 🤭
I'm interested in profit - you seem afraid to talk about profit, and to want to duck the point that profit is buried alongside other items to hide how much money GamePass is draining out of it.
 
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Hezekiah

Banned
Comparatevely MS makes more money per user than Sony.

Check your revenue figures you posted in bil $ divided by users.

If MS kills gold and/or rolls it up in the game pass ultimate, sony would either have to kill their revenue from ps+ (main source) or be ridiculed.
'Be ridiculed' - do you realise how nonsensical that statement is.

Sony is a business. That means they're in it to make money. Apparently Microsoft is so embarrassed by what its gaming segment makes (or rather loses), it hides it. This wasn't the case in the 360 era....

Dividing revenue figures by 'the numbers of users'. Does Microsoft even release 'the number of users' or is that hidden too 😂😂😂.
 
'Be ridiculed' - do you realise how nonsensical that statement is.

Sony is a business. That means they're in it to make money. Apparently Microsoft is so embarrassed by what its gaming segment makes (or rather loses), it hides it. This wasn't the case in the 360 era....

Dividing revenue figures by 'the numbers of users'. Does Microsoft even release 'the number of users' or is that hidden too 😂😂😂.

50mil users or less compared to 111 mil as many post. 15 VS 25 bil $ revenue.

Do the math.
 
50m - straight VG Chartz.

Stick that alongside 30m GamePass subs, and Halo Infinite getting better graphics thanks to the power of the Cloud lol.

I see you and your and your breathen are poised to do only console wars. I guess you reported the post from Bernd Lauert Bernd Lauert and got deleted free to engage me.

Nope.

By the power of the Cloud xbox has the only NEXT GEN game this year. MSFS.

Ηave fun trolling and be concerned about a 2 Trillion company and if it's moves are "profitable".

The only thing that divides us is the price of the game.

:messenger_beaming:
 

Hezekiah

Banned
I see you and your and your breathen are poised to do only console wars. I guess you reported the post from Bernd Lauert Bernd Lauert and got deleted free to engage me.

Nope.

By the power of the Cloud xbox has the only NEXT GEN game this year. MSFS.

Ηave fun trolling and be concerned about a 2 Trillion company and if it's moves are "profitable".

The only thing that divides us is the price of the game.

:messenger_beaming:
Another peasant too cheap to buy top quality games 🙄.
 
Look at what I wrote, and look at what you posted.

Literally makes no sense. Like bragging about about a $2 trillion company you have no actual ties too 🤦.

Ok i get it. You are jealous that sony doesn't want - can not give you the likes of game pass.

All you do is attacking gamepass for the quality of games or if it is or not profitable.

Stay with your platform of choice. Pay more for their linear games of the same kind with another skin, pay for upgrades and let us gamepass "peasants" (as you called me one) play our games.

I don't understand why you bother posting here.

PS: I understand you know whats coming now on for the rest of the gen for xbox - well you can't turn the tide. Bathe in it.
 

SaucyJack

Member
So Tom Warren's Tweet was from May.

Uncle Phil in June in an interview says otherwise:






I think the above statements will suffice. Maybe....

MS's endgame is to replace most 3rd party titles in the service with it's own productions from their self-owned studios - not all but a sizeable chunk while at the same time providing as much diversity in their games as they are able to.

I guess some folks realize that microsoft of all of the console manufacturers can achieve that, having the financial ability and makes them so "concerned" about their financials and ability to achieve that - that they will fight the product (game pass) which i bet they would love to have, judging from the comments about the PS5 instant collection (which is great), but unfortunately, ultimatately hate because "reasons".

Well they are correct.

They wil be in a state of "concern" for a long time going forward.

If you think about it the more game pass grows the more devs will struggle to get a spot in that (secure financing of the game) improving quality and more exciting gaming ideas while Sony will have to offer/pay more trying to secure their timed exclusivity deals.

Yap thats it. Genious.

Well tbh that’s just marketing spin from Phil, which is absolutely his prerogative. We don’t have to blindly swallow it though.

Microsoft goal (just like Sony) is profit. They may forgo profit today if it leads to (a bigger) profit tomorrow. They’re not a charity, having more players on their platform today is so that they can earn more profit from them tomorrow.

People aren’t concerned about Microsoft's profits. They might concerned about the shape of tomorrow’s gaming industry though, I know that I am.
 
Well tbh that’s just marketing spin from Phil, which is absolutely his prerogative. We don’t have to blindly swallow it though.

Microsoft goal (just like Sony) is profit. They may forgo profit today if it leads to (a bigger) profit tomorrow. They’re not a charity, having more players on their platform today is so that they can earn more profit from them tomorrow.

People aren’t concerned about Microsoft's profits. They might concerned about the shape of tomorrow’s gaming industry though, I know that I am.

I agree with you but Phil is no PR person. He is on the board and can't talk shit.

And i don't understand your comment how Microsoft can shape tomorrow's gaming industry negatively while providing the "legacy" option as well. For sure they will shape the industry.
 
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I'm interested in profit - you seem afraid to talk about profit, and to want to duck the point that profit is buried alongside other items to hide how much money GamePass is draining out of it.
By that logic, Windows profit is also "buried" because nobody knows how much profit (or losses) it makes. Try again.
You really want another ban? That would be beautiful, watching you go up in flames again 😅
demons-souls-ps5.gif
That's not even bait, it's pathetic.
 

SaucyJack

Member
I agree with you but Phil is no PR person. He is on the board and can't talk shit.

And i don't understand your comment how Microsoft can shape tomorrow's gaming industry negatively while providing the "legacy" option as well. For sure they will shape the industry.

Phil is a very good PR person, it’s not a criticism but you're mistaken if you think otherwise. I never said he’s talking shit either, his job is to promote his product and it is asolutely his right to portray his company, his product and his own performance in the most positive way. We just need to remember that this is what companies do and apply some rational scepticism.

I also never explicitly made that comment you’re accusing me of, but yeah I absolutely would be concerned about the possibility of a digital only, subscription based future controlled by Microsoft. That’s about as dystopian as it gets for gaming.

Edit: and I’m equally not interested in a digital only, subscription based future controlled by Sony. Or Apple. Or Google. Or anyone.
 
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Sorcerer

Member
Its cute that you think MS is doing gamers a solid out of the kindness of their heart, like its some kind of charity.

Wait for the bait and switch if the service takes off. Its only cheap now because someone is footing the bill to hook you in.
Thing is if Microsoft pulls that bait and switch, many gamers could simply cancel their subs, many may have felt they got their money's worth regardless. So the onus is on Microsoft now. I think its a take it and leave it situation for most gamers. If you had gamepass for years and played your fill of games, the player won, not MS. MS has to tread lightly or lose all good will. MS put themselves in this hole, digging out will not be easy.
 

yurinka

Member
Sony didn't sell 1.6 billion games on PS4, Sony AND THIRD PARTIES did. You can't keep removing the agency of 3P publishers/developers from the picture.

At most, Sony sold 18% of that figure, or 288 million. However that is not 288 million @ $60. A lot of those were sold at discounts, and some were "sold" via bundles in various PS4 SKUs. So you are probably looking at 50% (to be safe) of those having sold at full price, or 144 million.

An that is over the course of seven years, or ~ 20 milion units per year. However, that 18% figure from earlier? That's from their reported share of 1P revenue (not software unit sales) from overall PS annual revenue for 2020. So not only would that percentage probably be even lower (as an average) when speaking of what portion of the 1.6 billion come from Sony 1P software, but the percentage itself is from a completely different metric and I'm being rather generous assuming a near 1:1 ratio between 1P software revenue and 1P software units sold (otherwise if the argument is that their software unit sales were larger out of the total software units sold, then you're talking about a LOT less of those units moving at full price, or moving at discounted prices etc.).
I think it was pretty clear I was talking about Sony's console games sales, which obviously most of them are 3rd party. Regarding your 18% figure, it changes every quarter. And they only mention it for that FY or quarter, and only started to share it relatively recently. We don't know the % of the full PS4 sales.

In any case, Sony's main business isn't their 1st party games. It's the 30% cut they get from the 3rd party game/DLC/IAP sales, discounted or not. So they won't want to hurt game sales with something like Gamepass and what Sony wants is to have everyone buying PS4/PS5 games.
 
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