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Spencer: Game Pass is very, very sustainable right now as it sits and it continues to grow
mckmas8808
Mckmaster uses MasterCard to buy Slave drives
Put the full info in a quarterly report then!
remember_spinal
Banned
Of course its sustainable they are a 2 trillion dollar company
When people talk about sustainability they are talking about profit long term and the quality of games, cost of service etc.
If its not a profit generating business, sure microsoft will be able to continue dumping resources into it but it won’t be the shift in the industry people expect it to be if other publishers and platform holders can’t make money doing it either
When people talk about sustainability they are talking about profit long term and the quality of games, cost of service etc.
If its not a profit generating business, sure microsoft will be able to continue dumping resources into it but it won’t be the shift in the industry people expect it to be if other publishers and platform holders can’t make money doing it either
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remember_spinal
Banned
You know when they’re bullshitting because they constantly post about sales, numbers, and what a success something is the moment they get a chance. So you know when they stop posting console numbers and subscription numbers its not something they’re proud of.
SatansReverence
Hipster Princess
REEEEEEEEE gamepass REEEEEEEEE!!!!!!
twilo99
Member
That guy is full of shit, we all know this.
Every since he got the boss job at xbox the brand has been going downhill.. its worse now than ever before. Its all one big lie, they've been loosing money for decades, xbox and microsoft are about to go bankrupt because of all this bullshitting Spencer has been doing for so long.
Oddvintagechap
Member
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sustainable with a side of possibly profitable.
I love the “Netflix“ move. We can‘t beat them, so lets devalue them. It’s going to be tragic. When ultimately we will get Ubisoft +, EA Now, Activision +, PS Now, Gamepass, Play Pass, Apple Arcade +, Disney + Games, Netflix + Games.. it’s gonna be messy.
Magnific0giganticus
Banned
Yeah, sure.
Numbers?
Didn't think so.
Numbers?
Didn't think so.
Coloress_Kafka
Member
Translation: It doesn’t matter how it looks when it’s soft, just focus on how much it can grow.
Iced Arcade
Member
Gamepass... You either absolutely love it or absolutely have a strange fear in it.
GHG
Member
AddictedProxy
Neo Member
Phil Spencer is a known liar so I would take his statements with huge grain of salt.
There is still a long way to go for this to become reality. Microsoft was forced to pivot their approach but nothing really indicates that the general public is biting strong enough for the rest of the industry to follow suit.
ToTTenTranz
Banned
What does "sustainable" mean?
Is it getting zero-sum profits minus expenses from the service alone? Are the profits from 1st-party games and/or console sales being redirected to support the service?
Is it getting zero-sum profits minus expenses from the service alone? Are the profits from 1st-party games and/or console sales being redirected to support the service?
GHG
Member
Sustainable means Microsoft have so much cash flow that they don't know what to do with it so they are not under any pressure financially for now at least.
kingfey
Banned
I would like to thank gaffers for their business analyst. Some great insight to kids, who have no clue about how big business operates.
Carry on with your bulshit words. Meanwhile I will enjoy with real world, where growth and sustainability means something, instead of useless numbers.
Carry on with your bulshit words. Meanwhile I will enjoy with real world, where growth and sustainability means something, instead of useless numbers.
AddictedProxy
Neo Member
MOTM
Banned
Says person with 0 MS shares while MS shareholders are enjoying seeing the share price go through the roof.
kingfey
Banned
Kids here argue what big companies, with professional business analysis worked on.
Its why I dont take this site seriously.
MrFunSocks
Banned
So.
Much.
Salt.
My god the replies in this thread are embarrassing.
Much.
Salt.
My god the replies in this thread are embarrassing.
OmegaSupreme
advanced basic bitch
IDKFA
I am Become Bilbo Baggins
receipts please.
SenjutsuSage
Banned
No. Like the man said, Game Pass is "very, very sustainable right now as it sits, and it continues to grow." That's all you need to know. The man told us to do the math ourselves also. Translation it's generally bringing in the kind of revenue all of us thought it was.
I’m so glad all the industry experts on GAF have set him straight!
Not sure how anyone can imagine the head of Xbox knows more about the business than these brave commenters on GAF.
You realize he’s talking to Stephen Totilo there, telling him - and naysayers like you - to do the napkin math?
You should try reading that passage again
Not sure how anyone can imagine the head of Xbox knows more about the business than these brave commenters on GAF.
You realize he’s talking to Stephen Totilo there, telling him - and naysayers like you - to do the napkin math?
You should try reading that passage again
Too bad for Phil. he has to provide that granular level of detail to shareholders now that acclaimed GAFfer mckmas8808 has called him out.
to be sure he doesn’t weasel away, why don’t you raise this burning issue at the next shareholder call?
SlimySnake
Flashless at the Golden Globes
Of course it's sustainable. They have 20 million monthly subscribers. Even if we assume 25% of them are $1 subs thats still $5 million in subs every month + a full $150 million from the other 15 million users.
That means they have $155 million every month to buy content. That's almost 3 million in $60 sales they can cover. So lets assume that their one month target for Forza was 3 million units sold, if they managed to retain all 20 million subscriber this month, they have already met their target. Any sales on top of that are pure profit.
Same goes for Halo next month. Halo 3 at the time had the biggest 3 day revenue of any game or movie with $180 million in sales. Im sure MS would be thrilled to see that 20 million members kept their gamepass sub for another month.
The problem is going to be months like January and February where they might need to go and get some big games like Far Cry and Ass Creed to keep people from ditching their subs. But even then, Far Cry 6 would not cost them $175 million, that's probably the price to get a big AAA game like that on Day 1, but three months on? they can easily pay Ubisoft $100 million and save the rest for other games that month.
That means they have $155 million every month to buy content. That's almost 3 million in $60 sales they can cover. So lets assume that their one month target for Forza was 3 million units sold, if they managed to retain all 20 million subscriber this month, they have already met their target. Any sales on top of that are pure profit.
Same goes for Halo next month. Halo 3 at the time had the biggest 3 day revenue of any game or movie with $180 million in sales. Im sure MS would be thrilled to see that 20 million members kept their gamepass sub for another month.
The problem is going to be months like January and February where they might need to go and get some big games like Far Cry and Ass Creed to keep people from ditching their subs. But even then, Far Cry 6 would not cost them $175 million, that's probably the price to get a big AAA game like that on Day 1, but three months on? they can easily pay Ubisoft $100 million and save the rest for other games that month.
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SenjutsuSage
Banned
The part that put the nail in the coffin to the doubters was when he invited people to do the math ourselves. Even acknowledging that some took advantage of the special promotions, he's essentially saying that most people are paying either $10 monthly or $15 monthly. Game Pass is bringing in insane amounts of revenue of no less than $210 million each month and $2.5 billion per year. These are minimums that do not even include the percentage of Ultimate subscribers, so the figures are even higher. And this is with me only assuming 21 million Game Pass Subscribers.
Phil has spoketh.
Phil has spoketh.
PropellerEar
Member
In a hypothetical Far Cry 6 scenario by mid next year, they’d be paying around $10m or so. Sales would have slowed to a trickle and the game would have been heavily discounted. Ubisoft games struggle to hold their price tags. Not sure why.
AddictedProxy
Neo Member
Yeah, cause companies especially big companies are faultless and the most trustworthy sources. "very, very sustainable" is a nice "professional business analysis" for the stupid, I guess....
How about you expand on the "useless numbers" and why growth and sustainability dont fall into this category.
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kingfey
Banned
You are making a math error here.
5m at 1$ is 5m, while 15m at 10$ is 150m, total of 155m. You also need to account the gamepass ultimate.
5m at 1$ gamepass ultimate, 5m at 10$ normal gamepass, and gamepass pc, 10m at 15$ gamepass ultimate. total would be 5+50+150=205m.
hope this helps.
Guilty_AI
Member
Pretty much the math i was just doing, it sounds like a very profitable business model when you have the power to attract a good number of subscribers. Some additional thoughts/corrections though:
if we assume 25% of them being 1$ subs, we get $5million dollars for them, not 25.
Theres also the ultimate sub that costs 15$/month instead of 10.
So if we take those into consideration we actually have something like:
$5million + somewhere between $150million and $225million, aka still impressive numbers. So the point stands.
The issue here is knowing how much of that money actually goes to their pockets, how much do they have to pay the developers/pubs who keep or put their games there.
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Firstly your maths is bad. Second, you post this shit every single time this topic comes up and each and every single time you're told what you're saying is nonsense and illogical.
The entire month revenues of Game Pass are not spent on just one fucking game. It is spent on multiple games. Multiple games launch each month on the service. Further more you're just accounting for launch units. You're completely disregarding any future sales that are lost because your logic is attributing the future month's subs to some other future game.
If you wanted to silo it month-by-month you need to compare the monthly revenue against lost sales for the lifetime of all games launched that month.
SlimySnake
Flashless at the Golden Globes
$10 per month per subscriber. 15 million subcribers * 10 dollars = $150 million.Check your numbers.
What am I missing?
Netflix works the same way. They have 200 million subscribers and earn around $25 billion a year. That's $2 billion a month * 12 months = $24 billion.
Sosokrates
Report me if I continue to console war
DeepEnigma
Gold Member
Uhhh, what is overhead and having to pay out content providers already on there with the pay per time played model.
They don't pocket the full sub amount every month.