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[Insider Gaming] Microsoft Spends $1 Billion a Year to Bring Third Party Tittles to Game Pass

Lunatic_Gamer

Gold Member
iu


The tech titan spends $1 billion annually to pull third-party games onto Game Pass, often parting ways with millions of dollars just to put pen to paper and get the deals signed.

In the gargantuan report written by Bloomberg’s Dina Bass and Cecilia D’Anastasio, everything from the recent clash between Microsoft and the CMA to the potential of a handheld Xbox device was explored.
It was a paradigm shift for Microsoft, standing up something that would see value trickle in over time rather than relying on that one supersized launch to rake in a substantial payday. That’s what Sarah Bond alluded to, touching on the alteration in the operating model:

There’s a difference between managing a network effect and maximizing the value of a single game.

Bloomberg then mentioned that Microsoft spends a whopping $1 billion a year bringing third-party games into the Game Pass ecosystem, which has been modelled recently as a ‘Play Anywhere’ system that transcends simple home consoles.

Game Pass was also a major adjustment for publishers. To sweeten the deal, Microsoft now spends $1 billion a year getting third-party games on the subscription service.
The largesse has been more than enough to win over small publishers, to whom it offers flat fees of millions of dollars upfront to include their titles, along with a portion of subscription revenue and the promise of exposure they couldn’t count on getting otherwise.

Owing to inflation, Game Pass has recently increased in price, and the games that take pole position in the library chop and change, but there’s no doubting the power it has as a subscription-based product. That notion is set to improve, too – next month, the first Call of Duty game will grace the service in the form of Black Ops 6.

It already incorporates titles from the Ubisoft Connect and EA Play services, making it a seriously stacked offering for gamers worldwide, and it’s getting better all the time.

Sarah Bond and the rest of the crew at Xbox have immense faith in the product, and with a seeming desire to move away from console gaming, it’s only a matter of time before a seamlessly connected Game Pass experience is the firm’s foremost focus.


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Spyxos

Member
With so much money, I would have expected a better selection of games. Or they are being ripped off.
 
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XXL

Gold Member
That this doesn't include 1st party development costs that are being put on the service as well (now that's just Ultimate and PC Game Pass).

That's quite a bit of money for what they're getting. It's not growing the base and they have declined from the previous generation.
 
That this doesn't include 1st party development costs that are being put on the service as well (now that's just Ultimate and PC Game Pass).

That's quite a bit of money for what they're getting. It's not growing the base and they have declined from the previous generation.

The 1 billion isn’t that bad if you’re looking at just all third-party but exactly as you’re saying once you add first party to the mix it gets way way more expensive.
 
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