If you sell individual games, you have basically two ways of making more money: make more games or make better games so more people buy them.
The economies for a subscription service are completely different. People don’t subscribe to GamePass for a specific game, they subscribe for the entire collection. More games or better games don’t really drive up the number of subscribers. The only way to make more money is to drive down costs. You don’t make expensive, awesome games. Instead you drip-feed a steady stream of low-budget titles. You just have to make sure that the value of access to the entire collection is just about worth the subscription price.
Microsoft doesn’t care about games, they care about making money. They didn’t get into gaming because of a love for games, they realized it’s a market they didn’t dominate yet.
They lured people into GamePass with day-1 drops of AAA titles and now that the subscribers are there it’s time to squeeze as much money out of the service as possible.
And it’s not just GamePass. It’s all subscription services. Netflix is a good example: quality has been going down there for years.
The only real exception seems to be music streaming, but that’s mainly because there are so many artists and practically no exclusivity. In other words: there is healthy competition in the music streaming business.
Very nicely explained, I find myself in agreement with you. This makes a lot of sense and would explain their current behaviour. So, with this in mind, if I look at Microsoft’s statement from the article, it now reads slightly differently. Before, it was just their statement verbatim: “we need games like Hi-Fi rush”, but now it’s “we need games like Hi-Fi Rush, but a hell of a lot cheaper”. All because of GamePass. Dude, I am so sick of subscription services.
The gamepass numbers looks way better than they actually are. There is that loophole where you can buy Xbox gold and convert to gamepass for a really small amount compared to what gamepass actually charges. A ton of people like myself got that deal, because it was like $100 for 3 years of gamepass. I will never renew or do gamepass again, as it’s just not worth it for me. I imagine there a ton of people like myself on the discounted converted plans with no plans of renewal, especially at full price.
They have set themselves up to lose a ton of users, and fail, and they are unaware.
This is an excellent explanation of why the layoffs were a terrible idea.
I wouldn’t have volunteered $30-$40 for Hi-Fi Rush on release because of my low budget for new singleplayer games - but I did play it through Game Pass, and knowing how good it is now I would’ve paid more. Similarly, MS has put out many “mixed” games that are perfect for certain types of people but not many others. Those are the things that keep people on Game Pass. Nobody needs to be paying $100 a year to keep playing the few familiar live service games they know.
The “unsubscribe” button is really easy to reach the month Game Pass stops putting out anything new and interesting, and that’s coming soon now that they have no one ready to put out these surprise hits.
And music streaming is only as good as it is because artists are getting completely shafted at every turn by both the streaming services and the record labels.
Simple: It’s GamePass.
If you sell individual games, you have basically two ways of making more money: make more games or make better games so more people buy them.
The economies for a subscription service are completely different. People don’t subscribe to GamePass for a specific game, they subscribe for the entire collection. More games or better games don’t really drive up the number of subscribers. The only way to make more money is to drive down costs. You don’t make expensive, awesome games. Instead you drip-feed a steady stream of low-budget titles. You just have to make sure that the value of access to the entire collection is just about worth the subscription price.
Microsoft doesn’t care about games, they care about making money. They didn’t get into gaming because of a love for games, they realized it’s a market they didn’t dominate yet.
They lured people into GamePass with day-1 drops of AAA titles and now that the subscribers are there it’s time to squeeze as much money out of the service as possible.
And it’s not just GamePass. It’s all subscription services. Netflix is a good example: quality has been going down there for years.
The only real exception seems to be music streaming, but that’s mainly because there are so many artists and practically no exclusivity. In other words: there is healthy competition in the music streaming business.
Very nicely explained, I find myself in agreement with you. This makes a lot of sense and would explain their current behaviour. So, with this in mind, if I look at Microsoft’s statement from the article, it now reads slightly differently. Before, it was just their statement verbatim: “we need games like Hi-Fi rush”, but now it’s “we need games like Hi-Fi Rush, but a hell of a lot cheaper”. All because of GamePass. Dude, I am so sick of subscription services.
The gamepass numbers looks way better than they actually are. There is that loophole where you can buy Xbox gold and convert to gamepass for a really small amount compared to what gamepass actually charges. A ton of people like myself got that deal, because it was like $100 for 3 years of gamepass. I will never renew or do gamepass again, as it’s just not worth it for me. I imagine there a ton of people like myself on the discounted converted plans with no plans of renewal, especially at full price.
They have set themselves up to lose a ton of users, and fail, and they are unaware.
No, they’re aware. They’re just hoping the shareholders aren’t.
This is an excellent explanation of why the layoffs were a terrible idea.
I wouldn’t have volunteered $30-$40 for Hi-Fi Rush on release because of my low budget for new singleplayer games - but I did play it through Game Pass, and knowing how good it is now I would’ve paid more. Similarly, MS has put out many “mixed” games that are perfect for certain types of people but not many others. Those are the things that keep people on Game Pass. Nobody needs to be paying $100 a year to keep playing the few familiar live service games they know.
The “unsubscribe” button is really easy to reach the month Game Pass stops putting out anything new and interesting, and that’s coming soon now that they have no one ready to put out these surprise hits.
And music streaming is only as good as it is because artists are getting completely shafted at every turn by both the streaming services and the record labels.