Support NeoGAF

[fred420170]

They are now a 4trillion dollar company. I think their financial analysts know more than you do. in your basement.

 

[BlackTron]

If the revenue is so good, why are they firing so many workers?

If the game is making money, what do we need these people for again?

 

[PlayStaytion]

Ryan McAffrey must make his own version of last stand podcast like Colin Moriarty, otherwise, he's irrelevant at this point.

 

[Cakeboxer]

Assumptions. Yeah...ok

Correct, assumptions and observations. Some people just keep falling for it over and over but never end up on the ban list. Did you expect leaked documents and videos from the annual mod meeting?

 

[Topher]

Correct, assumptions and observations. Some people just keep falling for it over and over but never end up on the ban list. Did you expect leaked documents and videos from the annual mod meeting?

No, it's what I expected

 

[SILKYSMOOTH30FPS]

Could very well be. I'm just saying it's a long burn. Netflix mastered it and now does pretty well for itself.

nextflix might an entertainment renting service, but when you look at what's on offer, and how much more expensive and how much longer game development takes, GP and Netflix cannot be compared.

 

[DenchDeckard]

Sony is doing it at a different scale, due to incompetence, and switching gears.

Microsoft is doing it as a symptom of being Microsoft and will only double down while scheming further.

It doesn't matter the reason. one is not worse than the other.

Go talk to someone who just lost their job at MS or a sony studio and tell them thats the reason why and see if they give a fuck.

 

[IFireflyl]

We lack some of the most important information to be able to discuss this properly.

How and what do Netflix pay?

How and what do MS pay?

In theory there could be a counter argument that you are saying ms pays out more to devs so developers are actually getting a good deal. Which crushes the complaint that gamepass isn't healthy for the industry.

You're right that we don't have full transparency into Netflix or Microsoft's exact payout structures, but that's not necessary to assess the larger point. The core issue isn't how much Microsoft pays developers. The core issue is that:

• Game Pass is still not profitable.
  • Microsoft has claimed that Game Pass is profitable, but they also obfuscate all data surrounding profitability.
  • Most sane people would agree that this is not the type of behavior it would expect a company to engage in, both publicly and with regards to the companies shareholders, if they could easily prove these assertions to be true.
• Major first-party titles like Starfield didn't recoup development + marketing budgets.
• The service requires massive upfront investments for content that takes years to produce (sometimes close to a decade!) and consumes more labor per unit than movies and TV shows.

Even if Microsoft is generous to developers, that doesn't make the model healthy or scalable. Paying generously for games that don't break even is unsustainable. If the model requires Microsoft to lose money and overpay just to keep developers from fleeing, that's a red flag, not a win. The "we don't know" argument doesn't refute the concrete evidence we do have:

• Netflix is profitable.
• Game Pass is likely not profitable based on the previously provided information.
• Netflix scales rapidly because shows are cheaper and faster to produce, and people consume them passively.
• Game Pass is bottlenecked by development time, development costs, and user time (games take 10–100 hours each).
• Netflix adds thousands of new pieces of content yearly. Game Pass adds a few dozen.

There's a reason developers like Larian and Remedy have publicly walked away from Game Pass:

• It kills long-tail sales.
• It forces developers into launch-day payouts that don't cover ongoing revenue.
• It turns games into a commodity in a way that undermines premium pricing and value perception (e.g. why pay for the game when I can get it for "free").

So even if MS is paying more per piece of content than Netflix, the outcome is still:

• Game Pass = high cost, low ROI, low scalability.
• Netflix = high ROI, high scalability, higher profit margins.

The burden is on defenders of Game Pass to show how that model becomes profitable, not just that Microsoft can afford to burn cash. Unless Game Pass radically shifts direction, it's simply an expensive promotional tool, not a viable Netflix-style platform.

 

[BlackTron]

It doesn't matter the reason. one is not worse than the other.

Go talk to someone who just lost their job at MS or a sony studio and tell them thats the reason why and see if they give a fuck.

Complete disagreement, of course the reason matters. Sony made a mistake while having a lapse. For Microsoft, it wasn't a lapse. They're running the company the same way they always have for decades, where half the destruction is even seen as a good and planned part of the process and the other half is a bonus due to their own incompetence.

 

[calico]

The difference in financial clout is why one is worse than the other, or at least has the potential to be.

 

[IFireflyl]

We can't see warnings so how do we know anyone gets a free pass?

It is anecdotal, but one example would be this post that I reported:

Post in thread 'Passport Bros. 🛂'

Jul 6, 2025

What you say is true.

Obviously I'm exaggerating, but women's standards for my generation have skyrocketed.

I understand you, my friend... From my own experience... DON'T DESPAIR OVER A WOMAN.


I now have three girlfriends. I go out with them occasionally, and thanks to not worrying and not letting pressure get to me, I still have them....

Believe me, in Mexico the woman they're hateful and crazy. You marry them and after 5 or 6 months they ask for a divorcie and take off your money and stuff.

That's why I'm very careful.

The secret is that we have...

• Heimdall_Xtreme

• 

I'll say it bluntly, but it's the truth: women are disposable at 30 years or older.

Maybe my reporting of this was just missed by accident, but moderation never did anything with this post or user. People get banned for making racist comments (rightly so), and I don't see the distinction here.

However, I don't want to make blanket statements. As I said, it's possible my reporting of that post was just missed by the moderation team. I'm not going to keep reporting it, because if they didn't miss it then I'll likely just piss someone off if they think that post is acceptable somehow.

 

[Rockman33]

Even if that's true (and we're accepting that without evidence), Netflix also delivers orders of magnitude more content than Game Pass.
Let's do the math:

• Netflix: ~7,500 unique titles (around 4,500 movies, 3,000 TV shows)
  • Each show has multiple episodes. 2024 alone added over 10,000 episodes.
  • Conservatively, the platform hosts 33,000–35,000 individual pieces of content (movies + episodes).
• Game Pass: ~450–500 games

That means Netflix has 66x more content than Game Pass on the low end. So Netflix spending 6–8x more for 66x more content isn't a point against Netflix; it's a point in favor of Netflix and against Game Pass. Let's break it down even further:

Service	Monthly Price	Approx. Content Count	Cost per Title
Game Pass Ultimate	$19.99	~500 games	~$0.04/title
Netflix Premium	$24.99	~33,000 titles	~$0.0007/title

Netflix provides ~57x more value per dollar just based on quantity. And that's before you even consider accessibility (games require time, hardware, and skill) versus the low barrier of watching a show.

Also, look at their financials:

• Netflix (2024)
  • Revenue: $39B
  • Expenses: $30.3B
  • Net Income: $8.7B
  • Profit Margin: ~22%
• Microsoft Gaming Division
  • Game Pass still isn't profitable.
  • Starfield cost $300 to $400 million to develop and market, and couldn't even break even.
    • Estimated sales revenue: ~$280M
    • Estimated loss: $20M+ (on best-case scenario)

Games cost more and take longer to make. Developers are increasingly hesitant to put their titles on Game Pass because they risk cannibalizing sales for a one-time payout. Microsoft is betting on a model that is far less scalable than Netflix. To bring this home in response to your original statement:

• Netflix should spend more because it has far more to offer.
• Netflix is profitable. Game Pass is not.
• Netflix's content is cheaper per unit, faster to produce, and easier to access.

Game Pass is the one failing to deliver ROI by every meaningful metric. Unless Game Pass radically changes its model or content strategy, I don't see how it could ever become profitable, let alone reach Netflix's level of success.

Not sure why I got a ChatGPT breakdown… All I was saying is they DEFINTELY don't spend the same amount. Wasn't talking about quality or production. Just the simple fact Netflix far outspends Gamepass so it's a bullshit comparison.

Take a breath and relax.

 

[Karim]

Xbox Game Pass revenue reached a new record for Xbox over the last year, achieving "nearly $5 billion" in revenue for the first time.

This comes from the company's Q4 and full-year earnings results, covering the last twelve months ending June 30, 2025. While CEO Satya Nadella announced the milestone on the call, he did not provide specific revenue numbers for Game Pass.

Nadella also did not share subscriber numbers. That said, Game Pass subscribers are confirmed to have reached 34 million back in February 2024, and a Microsoft employee's profile suggested just two months ago that this number had reached 35 million, though this is unverified.

Some of that growth likely comes from price hikes on the service that kicked off in July of last year. But it hasn't hurt that Xbox dropped a number of new first-party games on Game Pass especially in the last quarter of the fiscal year, including The Elder Scrolls: Oblivion: Remastered, Doom: The Dark Ages, and Indiana Jones and the Great Circle.

Overall, gaming revenue for Xbox was up 10% year-over-year and Xbox content and services revenue was up 13%, driven by growth in first-party content and yes, Xbox Game Pass. Hardware revenue was down year-over-year by 22%.

Despite these increases, Xbox recently laid off hundreds of workers across various parts of its gaming business and canceled multiple projects, including Everwild and Perfect Dark.

Xbox Game Pass Revenue Was 'Nearly $5 Billion for the First Time' Over the Last Year - IGN

Xbox Game Pass revenue reached a new record for Xbox over the last year, achieving "nearly $5 billion" in revenue for the first time.

www.ign.com

---

Here is the direct quote and the transcript from the earnings call:

"And Game Pass annual revenue was nearly $5 billion for the first time."

https://view.officeapps.live.com/op/view.aspx?src=https://microsoft.com/en-us/investor/earnings/FY-2025-Q4/Document/DownloadDocument/65/TranscriptQandAFY25q4.docx

 

[IFireflyl]

Not sure why I got a ChatGPT breakdown… All I was saying is they DEFINTELY don't spend the same amount. Wasn't talking about quality or production. Just the simple fact Netflix far outspends Gamepass so it's a bullshit comparison.

Take a breath and relax.

You got an educated breakdown of the two services, nothing more. Your response that they don't spend the same amount was pointless. Sony, Microsoft and Nintendo all have wildly different spending. People compare them all the time. You don't get to dismiss the comparison because the amount they spend, which is a single variable, is different (even wildly so).

And what about my response indicates that I wasn't relaxed? There was nothing in my response that indicated that I was doing anything other than providing context.

 

[Tobimacoss]

Netflix spent upwards of 29bil last year

Dang. Yea, my data is from around 2023, I knew they were spending most of their revenues. But $29 billion is absolutely crazy. Most expenses of any other streaming service.

Even Disney+ and HBO Max are less than $8-10 billion.

But overall point is, it is much cheaper to fund and maintain a gaming service than it is to fund a movies and TV service. Plus only one other competitor (PS+ Premium) which refuses to compete properly.