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[thismeinteil]

This part of the discussion is irrelevant though. They can pull the plug tomorrow, they could have (and were close to) pull the plug a decade ago.

It's not about 'eating the loss', clearly Microsoft as a company is in no financial troubles and Satya is happy enough to sign off massive double digit billion dollar checks for the endeavor.

The whole "X year is the most detrimental factor for Xbox's existence" talking point is already a decade old now. It is not an immediate concern/factor for them.

Considering we already have the 2027 deadline, it seems behind the scenes he isn't happy just footing the losses forever. It obviously is a concern if he's given them a countdown to the end. At least the end of Xbox as we know it today.

 

[adamsapple]

Considering we already have the 2027 deadline, it seems behind the scenes he isn't happy just footing the losses forever. It obviously is a concern if he's given them a countdown to the end. At least the end of Xbox as we know it today.

We also have their plans for the next-gen console hardware though, from leaked internal documents no less, with even more rumors talking about them bringing it up to 2026.

 

[poppabk]

Considering we already have the 2027 deadline, it seems behind the scenes he isn't happy just footing the losses forever. It obviously is a concern if he's given them a countdown to the end. At least the end of Xbox as we know it today.

What 2027 deadline?

 

[adamsapple]

What 2027 deadline?

Some folks have latched onto Phil commenting something like "if we don't expand game pass xyz amount from off-console subscribers (i-e PC / cloud) then we might as well stop the gaming division after 2027" (para-phrased).

 

[thismeinteil]

We also have their plans for the next-gen console hardware though, from leaked internal documents no less, with even more rumors talking about them bringing it up to 2026.

Your point? Why do you think they wouldn't plan in case they made the threshold to continue? Man, you have less confidence in MS than I do.

As far as releasing early, I already addressed that in my previous post.

 

[adamsapple]

Your point? Why do you think they wouldn't plan in case they made the threshold to continue? Man, you have less confidence in MS than I do.

That you don't plan this far ahead if you are thinking about leaving the industry in a couple of years if an arbitrary goal is not met.

 

[poppabk]

Some folks have latched onto Phil commenting something like "if we don't expand game pass xyz amount from off-console subscribers (i-e PC / cloud) then we might as well stop the gaming division after 2027" (para-phrased).

Right that's what I thought but every sale of an Xbox is detrimental to achieving that goal so it seems like completely the wrong thing to bring up here.

 

[Mr Moose]

We also have their plans for the next-gen console hardware though, from leaked internal documents no less, with even more rumors talking about them bringing it up to 2026.

This or something else?

This is Microsoft’s new disc-less Xbox Series X design with a lift-to-wake controller

Microsoft’s mid-cycle Xbox Series X refresh has a whole new shape.

www.theverge.com

 

[yazenov]

We also have their plans for the next-gen console hardware though, from leaked internal documents no less, with even more rumors talking about them bringing it up to 2026.

I mean, throwing everything at the board and hoping it sticks it's going to change Xbox position of dead last in the market. At this point, the writing is in the wall.

They tried with the money sink that is Gamepass which cannibalises their own software sales , undercutting the competition in price with the cheapest model and also constant price cut fire sales of both their hardware, and the 70 billion purchase of publishers. A for efforts, C for execution. They still ended up dead last and are losing market share with sales worst than the failure that is the Xbox one.

Its Jo over. Xbox will most probably after the 2024 massecre ditch the Xbox hardware and start their more profitable 3rd party venture. They will struggle to reach 40 million in sales this generation and no amount of cope will change their fortunes. MS is running a business, and they need to see the ROI on these investments or else a change will be forced to happen.

 

[adamsapple]

This or something else?

This is Microsoft’s new disc-less Xbox Series X design with a lift-to-wake controller

Microsoft’s mid-cycle Xbox Series X refresh has a whole new shape.

www.theverge.com

No, that's the redesign that some insiders are saying is not happening anymore in lieu of them bringing the next-gen console up early to capitalize like X360.

 

[Mr Moose]

No, that's the redesign that some insiders are saying is not happening anymore in lieu of them bringing the next-gen console up early to capitalize like X360.

Q1 23, ARM V Zen 6...? Is this fan made?
What's Thin OS?

 

[adamsapple]

Q1 23, Zen 6...? Is this fan made?
What's Thin OS?

This is a part of the documents they accidentally uploaded unredacted to FTC early in the year.

I think the Q123 is when they'll finalize / start investing in it (or at least that's what it reads like to me).

Thin clients are like small remote-computing units, like cloud-streaming basically. So, that would imply they're looking at a two-device solution again, one proper console and the other a cheaper 'streaming box'.

 

[thismeinteil]

That you don't plan this far ahead if you are thinking about leaving the industry in a couple of years if an arbitrary goal is not met.

What are they supposed to do? "Hey, guys, we met our goal, so what do we do, now, since we have nothing planned." Again, you have less confidence in MS/Xbox as a business than I do.

Right that's what I thought but every sale of an Xbox is detrimental to achieving that goal so it seems like completely the wrong thing to bring up here.

How is selling an Xbox detrimental to increasing GamePass subs OFF-CONSOLE? Obviously, they aren't making enough off of Xbox HW and SW to keep them going without MS having to absorb the losses, so are looking to PC (and maybe other consoles in the future) to help.

Phil didn't pull that 2027 date out of his ass. It must have come from discussions that were going on behind the scenes.

 

[yazenov]

Phil didn't pull that 2027 date out of his ass. It must have come from discussions that were going on behind the scenes.

Yeah even Phil and most of the world most probably didn't expect the XBS to flop in sales worst than the Xbox One. They must have thought that this time around the sales will be more competitive. Reality hit them hard in the face. The XBS exceeded no ones expectations.

Their 2027 exit plans will most likely be accelerated by their dire hardware sales and loss of market share.

 

[poppabk]

How is selling an Xbox detrimental to increasing GamePass subs OFF-CONSOLE?

Because if you buy an Xbox you are unlikely to subscribe to gamepass for PC or for streaming?

 

[adamsapple]

How is selling an Xbox detrimental to increasing GamePass subs OFF-CONSOLE? Obviously, they aren't making enough off of Xbox HW and SW to keep them going without MS having to absorb the losses, so are looking to PC (and maybe other consoles in the future) to help.

Phil didn't pull that 2027 date out of his ass. It must have come from discussions that were going on behind the scenes.

But the quote about 2027 that you're parroting has no mention of hardware at all, he is directly and specifically talking about game pass subs. Why are you incorrectly conflating the two repeatedly?

It's already an out of context statement and you're taking it even further out lol.

Their 2027 exit plans will most likely be accelerated by their dire hardware sales and loss of market share.

2027 exit plans? Oh brother

 

[demigod]

We also have their plans for the next-gen console hardware though, from leaked internal documents no less, with even more rumors talking about them bringing it up to 2026.

No, that's the redesign that some insiders are saying is not happening anymore in lieu of them bringing the next-gen console up early to capitalize like X360.

Here you are contradicting yourself. Xbox can’t leave the industry because they have the next xbox planned. They also happened to have the stream stick and redesign planned, and what happened to them?

 

[LordCBH]

No, that's the redesign that some insiders are saying is not happening anymore in lieu of them bringing the next-gen console up early to capitalize like X360.

I’m really interested to see how that goes, actually. The Series X is a pretty sick console, but will jumping to the next Gen early actually turn anything around for them?

Ain’t like it was from PS2 to PS3/360 where the digital marketplace didn’t exist.

 

[yazenov]

But the quote about 2027 that you're parroting has no mention of hardware at all, he is directly and specifically talking about game pass subs. Why are you incorrectly conflating the two repeatedly?

It's already an out of context statement and you're taking it even further out lol.



2027 exit plans? Oh brother

Th growth of Game Pass subs is directly tied to hardware sales. Hense why the constant failure to meetings expectations when it comes to sub-growth.

 

[Goalus]

2027 exit plans? Oh brother

The usual suspects seem to be on a collective mushroom trip.

 

[HeWhoWalks]

The usual suspects seem to be on a collective mushroom trip.

Phil must have been on one too.

 

[adamsapple]

Th growth of Game Pass subs is directly tied to hardware sales. Hense why the constant failure to meetings expectations when it comes to sub-growth.

The quote being repeated is quite literally is about them growing subs outside of consoles. Console sales are irrelevant to any 2027 plans tied to game pass sales in this scenario.

This is not that hard. You're making it harder on yourself.

Here you are contradicting yourself. Xbox can’t leave the industry because they have the next xbox planned. They also happened to have the stream stick and redesign planned, and what happened to them?

Neither of us know what will happen to them, the redesign was penned for 2024, it's supposed cancellation is insider rumors.

This is not a contradiction lol

 

[yazenov]

The quote being repeated is quite literally is about them growing subs outside of consoles. Console sales are irrelevant to any 2027 plans tied to game pass sales in this scenario.

This is not that hard. You're making it harder on yourself.

Again, that's not happening without hardware sales. Thats where the bulk of Gamepass subs are from. I'd love to be proven wrong.

 

[adamsapple]

Again, that's not happening without hardware sales. Thats where the bulk of Gamepass subs are from. I'd love to be proven wrong.

I feel like I'm taking crazy pills here lol.

The quote is quite literally about them wanting to increase sub counts outside of console, the 'bulk of game pass subs being on console right now' is not a factor in that plan, they are specifically talking about wanting more subs outside of the 'current bulk of game pass subs from console' scenario.

 

[Heisenberg007]

The quote being repeated is quite literally is about them growing subs outside of consoles. Console sales are irrelevant to any 2027 plans tied to game pass sales in this scenario.

This is not that hard. You're making it harder on yourself.

So they are neither selling consoles nor growing Game Pass outside of consoles

Seems they are stagnant and stuck at this point then.

 

[poppabk]

Th growth of Game Pass subs is directly tied to hardware sales. Hense why the constant failure to meetings expectations when it comes to sub-growth.

Off console gamepass subs are not tied to hardware sales. That's exactly the point.

 

[Mr Moose]

Again, that's not happening without hardware sales. Thats where the bulk of Gamepass subs are from. I'd love to be proven wrong.

“I can fairly safely say that if we do not make more progress than this off of console, we would exit the gaming business. If this were the outcome, we would — I don’t believe we’d still be in the business.

“A majority of our customers are found off of our own hardware, I would hope by earlier than 2030. So, when you asked me if I agreed with this chart that the light green and blue depending on what colors you see there would have to be much larger much earlier. I would say by FY26, ’27 that we should be in that position, or we’d have to make a different decision with the business.”

He's talking about PC which I think might make it worse, if they are already reaching the limit on PC with their subs.

 

[yazenov]

I feel like I'm taking crazy pills here lol.

The quote is quite literally about them wanting to increase sub counts outside of console, the 'bulk of game pass subs being on console right now' is not a factor in that plan, they are specifically talking about wanting more subs outside of the 'current bulk of game pass subs from console' scenario.

"It's nice to want things." Shane Bettenhausen

 

[tommib]

It’s clear as day from game release schedules to hardware production capacity that 2023 was the year. 1TB Black Series S included.

They don’t have anything bigger than 23 in the pipeline for the console. Third year into this generation’s gamepass offerings, Redfall/Forza/Starfield, massive discounts, the Xbox showcase. People forget some of the biggest games of the generation launched this year too, like Hogwarts Legacy, Jedi Survivor, Baldurs Gate 3, Diablo 4 etc

And now they had to cut the price of the console, and I say cut not discount because it’s no longer labeled as discounted on local stores. 389.99€ for Series X and 249.99€ for Series S are now presented as normal prices, not discounted. Surely it moved some units compared to the previous prices, but that’s a really big price cut. That’s a 140-150€ price cut on the Series X from just a month ago? And they are producing this hardware on the exact same node, they must be taking a bath.

So now they are going to ride 24 on a price cut, probably try to create yet another hype cycle with an Xbox showcase, because the hype from the recent one is already dead, and hope to god having marketing rights for Call of Duty 34 is going to do what all the Xbox fans think it will do.

 

[Goalus]

Phil must have been on one too.

"Phil talks a lot."

The usual suspects refer to him as a liar on a regular basis, so I would expect the opposite to happen.

 

[demigod]

Neither of us know what will happen to them, the redesign was penned for 2024, it's supposed cancellation is insider rumors.

This is not a contradiction lol

The stream stick was canned. You’re right we don’t know what will happen. Yet you’re here stating that the next xbox will happen as a fact.

 

[adamsapple]

So they are neither selling consoles nor growing Game Pass outside of consoles

Seems they are stagnant and stuck at this point then.

Eh.

He said: “PC Game Pass subscriptions increased 159% year-over-year,

Xbox Game Pass growth is ‘slowing down’ on console, claims Phil Spencer | VGC

Xbox Game Pass growth on console is “slowing down,” according to Xbox boss Phil Spencer.

www.videogameschronicle.com

Also, in November it was revealed that the Asian PC Game Pass market as quadrupled.

The stream stick was canned. You’re right we don’t know what will happen. Yet you’re here stating that the next xbox will happen as a fact.

It's a fact as much as we know of it right now.

Like I said, Satya can close the department tomorrow if he wants to, the whole 'x year is the most detrimental thing for xbox' is a long running rhetorical point that's pretty tired by now.

 

[demigod]

He's talking about PC which I think might make it worse, if they are already reaching the limit on PC with their subs.

Nah it’s not PC because its stagnant already. It’s mobile and tv streaming.

 

[demigod]

Eh.

Xbox Game Pass growth is ‘slowing down’ on console, claims Phil Spencer | VGC

Xbox Game Pass growth on console is “slowing down,” according to Xbox boss Phil Spencer.

www.videogameschronicle.com

Also, in November it was revealed that the Asian PC Game Pass market as quadrupled.





It's a fact as much as we know of it right now.

Like I said, Satya can close the department tomorrow if he wants to, the whole 'x year is the most detrimental thing for xbox' is a long running rhetorical point that's pretty tired by now.

You just said its a rumor and now its a fact. Which is it my guy?

 

[HeWhoWalks]

"Phil talks a lot."

The usual suspects refer to him as a liar on a regular basis, so I would expect the opposite to happen.

Sounds like the usual suspects have taken up residence in your mind.

Get your eviction papers going.

 

[adamsapple]

You just said its a rumor and now its a fact. Which is it my guy?

Come on demi, you know exactly what I meant.

The 'fact' part is from their official documentations, anything on there is as much a fact as Insomniac's full release schedule. These are official internal documents.

The cancellation of the thing is what insiders are rumoring has happened internally. We do not know that in an official capacity yet.

 

[poppabk]

So they are neither selling consoles nor growing Game Pass outside of consoles

Seems they are stagnant and stuck at this point then.

Quite possibly yes, doesn't change the fact that the statement about expanding their market outside of Xbox consoles by 2027 will not be helped by selling Xbox consoles.

 

[demigod]

Come on demi, you know exactly what I meant.

The 'fact' part is from their official documentations, anything on there is as much a fact as Insomniac's full release schedule. These are official internal documents.

The cancellation of the thing is what insiders are rumoring has happened internally. We do not know that in an official capacity yet.

No, the only fact is they have a plan. Plans can change. It is not a fact the next xbox will release.

 

[Heisenberg007]

Quite possibly yes, doesn't change the fact that the statement about expanding their market outside of Xbox consoles by 2027 will not be helped by selling Xbox consoles.

I agree with that. Different things.

But if Xbox does selling lots of consoles and increase its profitability, it will help them. It can even help them push their 2027 deadline to, say, 2030, giving them a much better chance to actually achieve that nigh achievable goal.

 

[Heisenberg007]

Eh.

Xbox Game Pass growth is ‘slowing down’ on console, claims Phil Spencer | VGC

Xbox Game Pass growth on console is “slowing down,” according to Xbox boss Phil Spencer.

www.videogameschronicle.com

Also, in November it was revealed that the Asian PC Game Pass market as quadrupled.

That's because it is so small to begin with (a total of 3 million PC Game Pass subscribers, IIRC?). It's like, "Japan is the fastest-growing market for Xbox." Totally meaningless in the context of this 100 million subscribers goal.

Japan is Xbox's fastest growing market

Japan is Xbox's fastest growing market, Xbox head Phil Spencer said in a video introducing the company's Tokyo Game Sho…

www.gamesindustry.biz

 

[adamsapple]

That's because it is so small to begin with (a total of 3 million PC Game Pass subscribers, IIRC?). It's like, "Japan is the fastest-growing market for Xbox." Totally meaningless.

Japan is Xbox's fastest growing market

Japan is Xbox's fastest growing market, Xbox head Phil Spencer said in a video introducing the company's Tokyo Game Sho…

www.gamesindustry.biz

I don't think they've ever said the divide between PC and Console game pass subscribers.

But let's say it was 3, 159% growth year over year brings it almost up to 5 million. If there were 10 million PC game pass subscribers by the time they released the last official tally of 25m years ago, that means over the year they went from 10 to 16~ million PC subscribers in total owing to that 159% growth, yoy, if it stays at that number and doesn't decrease (or increase)

Not factoring in the quadruple thing, which if it involves the greater Asian market, not just Japan, could very well be a sizable increase.

 

[yazenov]

I don't think they've ever said the divide between PC and Console game pass subscribers.

But let's say it was 3, 159% growth year over year brings it almost up to 5 million. If there were 10 million PC game pass subscribers by the time they released the last official tally of 25m years ago, that means over the year they went from 10 to 16~ million PC subscribers in total owing to that 159% growth, yoy, if it stays at that number and doesn't decrease (or increase)

Not factoring in the quadruple thing, which if it involves the greater Asian market, not just Japan, could very well be a sizable increase.

MS seems to be hitting the ceiling with the 25 million subscribers. Growth has stalled overall from the leaks:

From the unredacted documents, this is the investigation hearing that took place remotely between the FTC and Microsoft in October 2022, the excerpt says as follows:

Q. (FTC): Let's talk about Game Pass. How many subscribers does Game Pass have now?

P. Spencer - Highly Confidential

My note: (I think we can assume this was the 25 million number provided by Microsoft in January 2022)

Q. (FTC): And that's the same number that I think was announced when the Activision deal was announced. It has not grown in the last, if you know, eight or nine months?

A. (Phil Spencer): It has not

 

[adamsapple]

MS seems to be hitting the ceiling with the 25 million subscribers. Growth has stalled overall from the leaks:

I'm sure he is gonna tell the lawyers that their vessel for Xcloud, the most contentious part of the whole acquisition, is thriving and have it used against them

Highly Confidential indeed.

 

[Mr Moose]

 

[thismeinteil]

But the quote about 2027 that you're parroting has no mention of hardware at all, he is directly and specifically talking about game pass subs. Why are you incorrectly conflating the two repeatedly?

It's already an out of context statement and you're taking it even further out lol.

The only thing I'm changing is adding HW, only because I highly doubt MS is completely leaving gaming if they don't hit their mark for profitablity, as Spencer says they will. If they don't hit it, it's more likely they will restructure as a 3rd party business. Hopefully refocusing on quality over quantity. More than likely, they'll have to stop their Day 1 on GamePass when it comes to other platforms.

Still not understanding how I have more confidence in MS than you do.

 

[adamsapple]

Still not understanding how I have more confidence in MS than you do.

This is the 4th time you've said this and I don't even know what this means lol. I'm only pointing out the fault in your logic about hardware sales being tied to Phil's 2027 statement. That statement had jack all to do with hardware sales.

 

[StealthGoblin]

Here you are contradicting yourself. Xbox can’t leave the industry because they have the next xbox planned. They also happened to have the stream stick and redesign planned, and what happened to them?

I don't think anyone out there is suggesting a total withdrawal from hardware for Xbox.

The speculation has been that the next box will be very high end for enthusiasts with a very robust multiplatform approach for their publishing arms.

That way they get to keep their highly engaged whales while also gaining access to approx ,200m projected additional devices.

Their ABK revenue eclipses much of their existing efforts.

I do wonder whether they'll stick with gamepass IF they go that route. They'd make more money from pure software sales and I can't see a rival sub trying to replicate that approach wholeheartedly.

2024 will be interesting for a variety of reasons -

what will they do to try and disrupt the PS5 Pro?

What will they do to try and disrupt the Nintendo launch?

Will we see more Xbox owned IP launch on other platforms (Shinobi said that we should expect more of that).

Will we find out what's going on with Blade?

 

[yazenov]

This is the 4th time you've said this and I don't even know what this means lol. I'm only pointing out the fault in your logic about hardware sales being tied to Phil's 2027 statement. That statement had jack all to do with hardware sales.

Did Phil expect something like 100 million Gamepass subs by 2027? If so, I think he should pack his bags early because it aint reaching those numbers

 

[Elios83]

The whispers are that they've actually internally pivoted to a multiplatform development manta for a lot of games. Games that were greenlit as Xbox only are now getting ports factored into their development and older games are being ported too. Lots of talk of this around and generally there is no smoke without fire. That to me is a huge concession in the console space.

I think becoming the largest third party publisher by far is the route to success for them. Trying to compete with Sony and Nintendo is a matter of pride for them but they've now failed four times.

I've also read these "rumors" but it's hard to say how reliable they are at this point.

Regardless reality is that Microsoft's strategy is failing. There is just no demand for Series S which they believed would become the choice for millions of casual gamers.
Hardware sales have fallen behind the Xbox One and even with super aggressive devaluing promotions that once would have made sales explode, early signs looking at online charts are that they still weren't enough to outsell PS5 for a single month (we'll see if this is confirmed with the next Circana report).
Subscription sales have also flatlined as Piscatella said on twitter so this situation is also affecting their Gamepass growth plans...so much for "they don't care about hardware sales".

Imo their biggest chance at being a gaming giant long term is indeed becoming a platform agnostic contents/services provider.
They can still have their own hardware line but as an option.

 

[StealthGoblin]

I've also read these "rumors" but it's hard to say how reliable they are at this point.

Regardless reality is that Microsoft's strategy is failing. There is just no demand for Series S which they believed would become the choice for millions of casual gamers.
Hardware sales have fallen behind the Xbox One and even with super aggressive devaluing promotions that once would have made sales explode, early signs looking at online charts are that they still weren't enough to outsell PS5 for a single month (we'll see if this is confirmed with the next Circana report).
Subscription sales have also flatlined as Piscatella said on twitter so this situation is also affecting their Gamepass growth plans...so much for "they don't care about hardware sales".

Imo their biggest chance at being a gaming giant long term is indeed becoming a platform agnostic contents/services provider.
They can still have their own hardware line but as an option.

I still think there is a place for Xbox hardware,.but I've felt more and more that it shouldn't be at the 'critical mass' targeting spec. They've got both the most powerful and the cheapest hardware this gen and they are tracking below the console that tracked below the one before.

Top end enthusiast walled garden (Premium like a PC build spec) and then broad publishing seems like it would suit their current size and capability.