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[cireza]

"Enforce" it how when Evo continued to use 360 even when the PS4 port was out. You're making no sense as usual.

Because this is what happened ? The tournament was supposed to played on PS4 for some mystical reason (while everybody was equipped with PS360 sticks, no Sony money involved for sure), but Evo had to backpedal when people complained at how shitty the port was when it got released, and went back to playing on 360. This is written in the article I posted above. Can you read ?

 

[Three]

The tournament was supposed to played on PS4 for some mystical reason (while everybody was equipped with PS360 sticks, no Sony money involved for sure), but Evo had to backpedal when people complained at how shitty the port was when it got released, and went back to playing on 360. This is written in the article I posted above. Can you read ?

So your own conspiracy theories when Evo wasn't "enforced" to do anything, got you. Did Evo/Capcom give the money back in this bedtime story?

 

[cireza]

So your own conspiracy theories when Evo wasn't "enforced" to do anything, got you. Did Evo/Capcom give the money back in this bedtime story?

Sony were sponsoring the events with a lot of prize money, they simply wanted to use Evo and other tournaments back then for marketing purpose and promote PS4. They didn't give a fuck about it. This is how they work. If you can't even see this, then this is straight up denial.

 

[Three]

Sony were sponsoring the events with a lot of prize money, they simply wanted to use Evo and other tournaments back then for marketing purpose and promote PS4. They didn't give a fuck about it. This is how they work. If you can't even see this, then this is straight up denial.

MS were adding to prize pots at Evo too and even with the prize pot Sony didn't "enforce" anything did they when 360 was still being used there. It's not difficult to admit that xbox lost the FGC on their own instead of creating a boogeyman.

 

[S0ULZB0URNE]

If they had sold more consoles they would have overcome these technology issues a long time ago. In reality it is a business decision.

Exactly

 

[thicc_girls_are_teh_best]

Simply answering to people implying that Xbox never had a role in the FGC. Read the thread.

Which is wrong by the way, as Xbox were forced out by the exclusivity deal between Sony/Capcom to force USFVI and SFV on PS4, including of course the Evo tournament on PS4 while the preferred console was the 360. But it didn't quite happen as expected. Facts.

Microsoft weren't "forced out" of anything: they and Sony/SIE had dibs on what Capcom games to aid in funding & exclusivity for. Guess what Microsoft chose? Dead Rising 3. Guess what Sony/SIE chose? Street Fighter 5. USFIV came with that particular deal, and since Microsoft didn't choose SFV, they lost out on USFIV as well. Which, IIRC, involved SIE's help in getting it ported to PS4 (since obviously PS4 was not BC with PS3, nor was XBO BC with 360, not until the BC program (slowly) started adding BC via emulation).

360 was only the "preferred console" for USFIV because the game was already available on 360 (and PS3) prior. SF4 released during 7th gen where in the US & UK, 360 dominated. But EVO, being a tournament held in America, favored a largely American audience between players, attendees and TOs. 360 was the popular home console in America during 7th gen, hence the choice. But none of that really mattered for SFV, as that was a new game and, clearly, everyone at tournaments like EVO just moved on to PS4 and PC for that game.

They went where the game was, more or less. Also BTW SIE helped co-fund SFV's development and also sponsored Capcom Cup for several years; using words like "force" imply something was taken away from Xbox. But AFAIK, SFV and USFIV for 8th-gen systems were never targeting Xbox One to begin with, due to the aforementioned deals that both Sony/SIE and Microsoft were making with Capcom during that gen.

Also worth mentioning, MS had similar exclusivity deals with Capcom during the 360 era with games like the first Lost Planet, which was a timed 360 exclusive. But I guess people just forget about 3P exclusivity deals when Microsoft are involved, unless they can make Microsoft look like a victim (i.e Rise of the Tomb Raider).

 

[ChorizoPicozo]

that's community is so pathetic

 

[S0ULZB0URNE]

Sony were sponsoring the events with a lot of prize money, they simply wanted to use Evo and other tournaments back then for marketing purpose and promote PS4. They didn't give a fuck about it. This is how they work. If you can't even see this, then this is straight up denial.

Evo uses the more popular console which was not Xbox when PS4 released.

 

[Astray]

that's community is so pathetic

Was honestly surprised that they contradicted him.

 

[Pelta88]

How do we explain 90-95% of the FGC’s peripheral market not being on the platform either? Exclusive sticks, pads, headset, and other merch don’t have an XB version because the audience isn’t there.

By now we’re all familiar with these podcasters trying to explain away what they see as a slight to the platform instead of remembering that when publishers like Capcom ask platforms to give exact numbers of their instal base, PR numbers are not a legal response.

 

[SneakersSO]

that's community is so pathetic

There are more games, and in the not-so-distant future even more so, that are skipping Xbox, due to the reality of how titles sell in that eco.

Nick here is using 'millions' as a qualifier for support - Capcom is not making these titles with the hopes that they'll sell millions, or even a million, on any one individual platform. This is sort of a separate conversation, one specifically regarding Capcom's focus on selling legacy titles in perpetuity, in addition to new releases. You can look up any individual quarter or yearly fiscal result from Capcom and note that they make about 40-60% of their revenue, sometimes even higher, from 'legacy sales'; evergreen sales. Thats what Capcom focuses on. Its a solid publisher strategy that ensures software they've already released continues to make money as it finds new audiences as time rolls forward.

For many publishers, selling in the Xbox eco comes down to the genre you're operating in, the studio name behind the title, the marketing budget, and incentives. With all those factors, there are still a number of titles i know that never broke even on the XSS/XSX sku's release. But this is a problem the market will be correcting, as MS winds down their hardware focus.

 

[SneakersSO]

Is FF14 one of those titles?

Well, SE got quite the payday from Xbox for FF14. Its quite the beneficial contract for SE, from what i've heard. Added server costs being fronted, for example.

 

[Varteras]

There are more games, and in the not-so-distant future even more so, that are skipping Xbox, due to the reality of how titles sell in that eco.

Nick here is using 'millions' as a qualifier for support - Capcom is not making these titles with the hopes that they'll sell millions, or even a million, on any one individual platform. This is sort of a separate conversation, one specifically regarding Capcom's focus on selling legacy titles in perpetuity, in addition to new releases. You can look up any individual quarter or yearly fiscal result from Capcom and note that they make about 40-60% of their revenue, sometimes even higher, from 'legacy sales'; evergreen sales. Thats what Capcom focuses on. Its a solid publisher strategy that ensures software they've already released continues to make money as it finds new audiences as time rolls forward.

For many publishers, selling in the Xbox eco comes down to the genre you're operating in, the studio name behind the title, the marketing budget, and incentives. With all those factors, there are still a number of titles i know that never broke even on the XSS/XSX sku's release. But this is a problem the market will be correcting, as MS winds down their hardware focus.

From where you sit behind the scenes, do you still feel there is quite a disparity between what developers and producers are aware of versus what the consumers have realized? Obviously, as time goes on it will become more and more clear, but do you feel many on the outside are still a great deal away from fully grasping what's ahead? Especially with people like Jez not actually knowing what he's talking about but still spinning narratives that some people still eat up.

 

[Barakov]

During the latest episode of the Xbox Two podcast (around the 2:09:40 timestamp), Jez says Microsoft lost their grip on the FGC starting wirh Street Fighter 5 and

 

[hinch7]

The image quality of the RE Engine is too soft, so I hope it will be improved.

VRS is killing the image quality here.

 

[SneakersSO]

From where you sit behind the scenes, do you still feel there is quite a disparity between what developers and producers are aware of versus what the consumers have realized? Obviously, as time goes on it will become more and more clear, but do you feel many on the outside are still a great deal away from fully grasping what's ahead? Especially with people like Jez not actually knowing what he's talking about but still spinning narratives that some people still eat up.

I guess this ultimately depends on what you mean by disparity - what context are we talking here? The views of MS as a console platform in the industry?

Look - before each generation starts, the hardware manufacturers basically go around to all the pubs and big devs and pitch the machine and why they should support it. Happens every time, all the players do it. No, they don't normally show the machines, but they typically are focusing on market factors and variables they predict will affect them. This is the 2nd generation in a row where MS massively over-promised how they HW pitch would do in the market, while completely under delivering on what returns would look like for publishers. Prior to the Xbox One, publishers couldn't have dreamed that MS would've gone the Game Pass route late into that generation, and thus permanently altering the purchasing habits of their user base. In the lead up to the XSS/XSX, MS was boldly proclaiming some of the outrageous lies that they were preaching to the public, like how Game Pass was increasing software sales in their eco; not only was this never true, by the time the 3rd party managers and Phil were preaching this to pubs, they themselves knew this wasn't true based on what their own returns had looked like during 2018 - 2020.

Despite that, Microsoft's word was still being taken at face value back then (it helps that their word also came with outrageously generous Game Pass deals for 3rd parties). The notion that they could potentially do an about face on the entire console generation this early on while Pubs and devs were still investing efforts and finances into it permanently soured plenty of relationships this year though. Lots of pubs feel like they were left out to dry, and they largely were, and we'll be seeing the ramifications of that in the short and long term.

On the bright side, Microsoft basically throwing their hardware position in the bin is a solid outcome for the industry at large. Microsoft gets to focus on selling software wherever they can, maximizing live-service revenue, growing their gaming-specific network service suite (PlayFab is fantastic), and having Cloud basically be there in case it ever catches. Would they have preferred it if they didn't have to bin consoles? Sure, but after how things went in June (not gonna get into it but lets just say some hail mary promises were made and no results for it came to fruition), they have to just accept the hand they have and go in the direction that makes the most sense for them.

Of all the folks I do feel for that still need to 'catch-up', as it were, its the consumers; there are so many Xbox consumers who are basically being blind-sided by the slow-moving implosion of Xbox HW. Lots of folks in that 30m+ core user group that don't pay attention to industry stuff who are basically being bled out like pigs just so they can maximize revenue on GP and console services while they take their time, to make up for how much money they have put into it without seeing a dime back. Microsoft simply had no scenario planned for this outcome, and its the consumers who are gonna suffer for it in terms of paying for this.

 

[Varteras]

I guess this ultimately depends on what you mean by disparity - what context are we talking here? The views of MS as a console platform in the industry?

Look - before each generation starts, the hardware manufacturers basically go around to all the pubs and big devs and pitch the machine and why they should support it. Happens every time, all the players do it. No, they don't normally show the machines, but they typically are focusing on market factors and variables they predict will affect them. This is the 2nd generation in a row where MS massively over-promised how they HW pitch would do in the market, while completely under delivering on what returns would look like for publishers. Prior to the Xbox One, publishers couldn't have dreamed that MS would've gone the Game Pass route late into that generation, and thus permanently altering the purchasing habits of their user base. In the lead up to the XSS/XSX, MS was boldly proclaiming some of the outrageous lies that they were preaching to the public, like how Game Pass was increasing software sales in their eco; not only was this never true, by the time the 3rd party managers and Phil were preaching this to pubs, they themselves knew this wasn't true based on what their own returns had looked like during 2018 - 2020.

Despite that, Microsoft's word was still being taken at face value back then (it helps that their word also came with outrageously generous Game Pass deals for 3rd parties). The notion that they could potentially do an about face on the entire console generation this early on while Pubs and devs were still investing efforts and finances into it permanently soured plenty of relationships this year though. Lots of pubs feel like they were left out to dry, and they largely were, and we'll be seeing the ramifications of that in the short and long term.

On the bright side, Microsoft basically throwing their hardware position in the bin is a solid outcome for the industry at large. Microsoft gets to focus on selling software wherever they can, maximizing live-service revenue, growing their gaming-specific network service suite (PlayFab is fantastic), and having Cloud basically be there in case it ever catches. Would they have preferred it if they didn't have to bin consoles? Sure, but after how things went in June (not gonna get into it but lets just say some hail mary promises were made and no results for it came to fruition), they have to just accept the hand they have and go in the direction that makes the most sense for them.

Of all the folks I do feel for that still need to 'catch-up', as it were, its the consumers; there are so many Xbox consumers who are basically being blind-sided by the slow-moving implosion of Xbox HW. Lots of folks in that 30m+ core user group that don't pay attention to industry stuff who are basically being bled out like pigs just so they can maximize revenue on GP and console services while they take their time, to make up for how much money they have put into it without seeing a dime back. Microsoft simply had no scenario planned for this outcome, and its the consumers who are gonna suffer for it in terms of paying for this.

Yes, I was referring to the difference between what people like yourself know is happening versus the greater gaming community's knowledge. There seem to be, as you pointed out, tens of millions of people who are still going on with their hobby with little clue about the shake up that's happening. Also as you pointed out, that's going to be very tough for people, fans, still oblivious to what's going to suddenly hit them in the coming years. Made even worse when people remotely keeping up with what's going on are still being influenced by glorified bloggers who actually know nothing. From your response, it seems you believe there are very much still a great many consumers who just have no clue and that right now not nearly enough have caught on. They probably won't until it's right on top of them.

I'm curious to hear a little bit more about the landscape of deals going on behind the scenes. In the last 6 months or so, you've stated that things had been breaking down between Xbox and third-parties for some time. That we're really just now seeing the beginning of the ramifications of Xbox's failures. Is the situation approaching a total collapse or are we already there? Is Microsoft already effectively dead in the console race and it's just a matter of waiting to see the corpse? I apologize if you feel you've already answered this, I guess I'm just looking for a little bit more, as I know there are many people, myself included, who wonder if it's truly the end of Xbox as a competitor, or if the gun has been jumped just a little bit.

Also, what are your impressions of the price increase on GamePass, including a tier with no Day 1 games? Especially with PC being cheaper and getting benefits than what console goers have to pay to get the same thing. Is this Microsoft simply trying to make money where they can? Or, is it also an indication of them slowly backing away from the GamePass model?

 

[Kumomeme]

probably one of main reason is they just didnt want spend time with Series S.

 

[Edmund]

that's community is so pathetic

Guy on the left looks like Chuck Liddell.

 

[Astray]

Would they have preferred it if they didn't have to bin consoles? Sure, but after how things went in June (not gonna get into it but lets just say some hail mary promises were made and no results for it came to fruition), they have to just accept the hand they have and go in the direction that makes the most sense for them.

Does this mean the supposed next-gen plans have been canned?

That's sort of what I'm getting from this part tbh. That the business case for making a next-gen console and handheld have failed to gain traction with upper brass.

 

[SneakersSO]

Is the situation approaching a total collapse or are we already there? Is Microsoft already effectively dead in the console race and it's just a matter of waiting to see the corpse? I apologize if you feel you've already answered this, I guess I'm just looking for a little bit more, as I know there are many people, myself included, who wonder if it's truly the end of Xbox as a competitor, or if the gun has been jumped just a little bit.

Also, what are your impressions of the price increase on GamePass, including a tier with no Day 1 games? Especially with PC being cheaper and getting benefits than what console goers have to pay to get the same thing. Is this Microsoft simply trying to make money where they can? Or, is it also an indication of them slowly backing away from the GamePass model?

Not only is MS dead in the console race, they aren't even pretending to have some distant hope that this outcome can be reversed someday. All you need to see is how they are winding down shipments in several markets, sunsetting marketing budget for the machine, to know its over. Heck, they just made a commercial that tells consumers you don't need an Xbox to play Xbox anymore. Not sure how much more clear cut they can be about it without them pulling a Sega, which they'll never do because why shut off what is essentially free revenue - those mergers aren't paying for themselves.

As for the price increases, the whole market pitch for GP was to create a service that was significantly lower cost than outright purchasing 2 new games a year. Gamepass was cooked up at a time where 2.5 games was about the median in new game sales per year, so coming in at around $120 per year was a goal to try and attract those users who may want to pay that fee and get way more value out of it. A lot of things have gone wrong for Game Pass, and while we can go and litigate all of its mistakes, its besides the point of the question you're actually asking - is Gamepass's days numbered? The short answer to your question is yes. There is simply a growth ceiling at play for Gamepass that they know they cannot break through. The overwhelming majority of GP users are console users, and they have absolutely no reason to believe that their console audience is going to expand. In fact, all they keep signaling is deeper and deeper retraction in their console marketshare footprint, so unless it takes off in a market sub-sector that it hasn't, like via xCloud and its inclusion with streaming devices and SmartTVs, theres really no chance for it to grow.

To speak more plainly to this, lets talk about business economics for a second. When a business within a market realizes that they are growth capped AND that you expect your userbase to begin shrinking in the short-term, the only real option you have as a business is to maximize revenue from that existing userbase as much as you can, while the specific market variables for said revenue continue to shrink/rot over time. A perfect gaming related example of this phenomenon that I like to use when speaking on this topic is Guitar Hero. In the beginning, we were getting Guitar Heroes basically yearly. Once ATVI realized that they had hit a growth ceiling and that sales were beginning to turn, ATVI began pumping out 2-4 Guitar Hero titles in a year, in an effort to maximize revenue. Its a really easy thing to identify once you know what you're looking for. Thats the phase Gamepass is in right now. And based on what i've heard, this isn't the final price for the service either. Its gonna go higher as it shrinks.

Does this mean the supposed next-gen plans have been canned?

That's sort of what I'm getting from this part tbh. That the business case for making a next-gen console and handheld have failed to gain traction with upper brass.

No, there is still going to be a machine, but the fanbase really needs to let go of the concept of generations, at least as we were taught to think of them in decades past. This console is meant less as a 'next-gen', despite them using the labelling because they know its what you want to hear, and will act more as a highly niche device for a significantly smaller addressable market than they've ever tried to target in years prior. Gamepass/XBLG still brings in revenue, and the console users who are still sticking around are more than happy to give MS money no matter what, so this is gonna be a product made for them to keep them on the revenue treadmill, as it were.

Its going to be presented as a 'new-generation', but it'll have a price tag that basically spells out what the expectations are for its marketshare footprint, and its going to function in terms of support closer to a Xbox One X or PS4/5 Pro than it will an actual new generation. You're not going to see games from Xbox made specifically for it that aren't also shipping on the XSS/XSX, for example. You're also going to see the few 3rd party titles still shipping on it basically continue to target XSS instead of targetting the machine specifically.

The console will exist as a means for core Xbox users to still have an avenue to keep giving them subscription revenue. Thats it.

 

[Varteras]

Not only is MS dead in the console race, they aren't even pretending to have some distant hope that this outcome can be reversed someday. All you need to see is how they are winding down shipments in several markets, sunsetting marketing budget for the machine, to know its over. Heck, they just made a commercial that tells consumers you don't need an Xbox to play Xbox anymore. Not sure how much more clear cut they can be about it without them pulling a Sega, which they'll never do because why shut off what is essentially free revenue - those mergers aren't paying for themselves.

As for the price increases, the whole market pitch for GP was to create a service that was significantly lower cost than outright purchasing 2 new games a year. Gamepass was cooked up at a time where 2.5 games was about the median in new game sales per year, so coming in at around $120 per year was a goal to try and attract those users who may want to pay that fee and get way more value out of it. A lot of things have gone wrong for Game Pass, and while we can go and litigate all of its mistakes, its besides the point of the question you're actually asking - is Gamepass's days numbered? The short answer to your question is yes. There is simply a growth ceiling at play for Gamepass that they know they cannot break through. The overwhelming majority of GP users are console users, and they have absolutely no reason to believe that their console audience is going to expand. In fact, all they keep signaling is deeper and deeper retraction in their console marketshare footprint, so unless it takes off in a market sub-sector that it hasn't, like via xCloud and its inclusion with streaming devices and SmartTVs, theres really no chance for it to grow.

To speak more plainly to this, lets talk about business economics for a second. When a business within a market realizes that they are growth capped AND that you expect your userbase to begin shrinking in the short-term, the only real option you have as a business is to maximize revenue from that existing userbase as much as you can, while the specific market variables for said revenue continue to shrink/rot over time. A perfect gaming related example of this phenomenon that I like to use when speaking on this topic is Guitar Hero. In the beginning, we were getting Guitar Heroes basically yearly. Once ATVI realized that they had hit a growth ceiling and that sales were beginning to turn, ATVI began pumping out 2-4 Guitar Hero titles in a year, in an effort to maximize revenue. Its a really easy thing to identify once you know what you're looking for. Thats the phase Gamepass is in right now. And based on what i've heard, this isn't the final price for the service either. Its gonna go higher as it shrinks.


No, there is still going to be a machine, but the fanbase really needs to let go of the concept of generations, at least as we were taught to think of them in decades past. This console is meant less as a 'next-gen', despite them using the labelling because they know its what you want to hear, and will act more as a highly niche device for a significantly smaller addressable market than they've ever tried to target in years prior. Gamepass/XBLG still brings in revenue, and the console users who are still sticking around are more than happy to give MS money no matter what, so this is gonna be a product made for them to keep them on the revenue treadmill, as it were.

Its going to be presented as a 'new-generation', but it'll have a price tag that basically spells out what the expectations are for its marketshare footprint, and its going to function in terms of support closer to a Xbox One X or PS4/5 Pro than it will an actual new generation. You're not going to see games from Xbox made specifically for it that aren't also shipping on the XSS/XSX, for example. You're also going to see the few 3rd party titles still shipping on it basically continue to target XSS instead of targetting the machine specifically.

The console will exist as a means for core Xbox users to still have an avenue to keep giving them subscription revenue. Thats it.

Thanks for taking the time. Always appreciate how well thought your answers are without getting into too many points and just getting to the more relevant conclusions. I have two more questions for you and then I'll leave you be.

First, in your opinion, is there a future where Microsoft just doesn't have a platform at all? Not just hardware wise, but also service/software? Is there potential that they will simply just make games and be fully third-party themselves? Or do you see them continuing to find some way to be a platform?

The other question is, how are things behind the scenes? I know we're not out of the woods, but are things beginning to settle down? Is the end of this new crash in sight and are people having stability and optimism return? Or are we still very much in rough waters with people expecting to be canned any minute? Hell, is that just the new reality of the industry for the foreseeable future?

 

[SneakersSO]

First, in your opinion, is there a future where Microsoft just doesn't have a platform at all? Not just hardware wise, but also service/software? Is there potential that they will simply just make games and be fully third-party themselves? Or do you see them continuing to find some way to be a platform?

The other question is, how are things behind the scenes? I know we're not out of the woods, but are things beginning to settle down? Is the end of this new crash in sight and are people having stability and optimism return? Or are we still very much in rough waters with people expecting to be canned any minute? Hell, is that just the new reality of the industry for the foreseeable future?

No - with the ATVI merger in particular, Microsoft has essentially cemented that they'll always have a platform. Them pulling out of Windows Phone essentially ensures they won't make the mistake of pulling out of a market completely unless there is simply no other choice to. Their future is 3rd party though, don't get it confused - just because they have a platform doesn't mean they aren't. EA was still a 3rd party publisher in spite of having Origin, same for Ubisoft and their store front, same for ATVI and Battle.Net.

Theres far too much money in being a platform onto yourself to not continue the course on this. They have the Windows Gaming store on PC, they have Battle.net, they have this mobile app store they wanna push. And being a platform also comes with their service offerings, which they aren't gonna give up, even if it does remain this ever-decreasing userbase and service compared to what it was in years prior. Microsoft has, with certain exceptions like the Xbox 360, long been a company where they are less popular than the product they are offering. Windows itself is a shining example of this. For the most part, I think they want to gravitate to a position where their head office folks are far less of a public focal point of business than the games themselves, which is very much how ATVI loved operating, which isn't a coincidence.

I mean, the industry is going to be tumultuous for, i'd say, 3-5 more years. Part of the issue, besides blind faith VC money being injected into it from 2020-2022 on the back of pandemic-driven growth which wasn't sustainable, is that we also had large financial groups that had spokespeople do consultations with publishers and convince them that the future was all live-service GAAS, which is why you saw such an enormous push towards it from basically all major players, while single-player and co-op games basically went through a financial renaissance in the last 6 years. GAAS games require very large dev and live-ops teams in order to come out, and the market simply cannot sustain how many of these titles seek to be an additional live-service pillar. Even the bigger names, like Bungie/Destiny, are still struggling, and so there are a lot of publisher initiatives still playing out where the fruits of those bets, driven by consultants from the financial world who pushed live-service at the expense of everything else, that are yet to crash but are going to. Some folks, like Sony, saw the signs earlier than most and began their pivot away, but we are gonna be a bit before we see the fruits of said pivot, which started happening in 2022-ish.

These consultants that pushed GAAS while down-talking all other genres/experiences still get speaking gigs and are still doing their best to get publishers to stay the course. This is why you have groups like Warner Bros. insisting they still plan on pursuing GAAS despite how absolutely disasterous Suicide Squad and Gotham Knights were. Japan figured it out far earlier though, and are being rewarded for it handily. One of the things that will shore up things as far as labor in the games industry is concerned is the ever-increasing unionization efforts. Lots of big teams are now fully unionized and we're going to be seeing more in the future. The future is still very bright for labor within the games industry, but we're still going to undergo some growing pains before hand.

 

[Astray]

As for the price increases, the whole market pitch for GP was to create a service that was significantly lower cost than outright purchasing 2 new games a year. Gamepass was cooked up at a time where 2.5 games was about the median in new game sales per year, so coming in at around $120 per year was a goal to try and attract those users who may want to pay that fee and get way more value out of it. A lot of things have gone wrong for Game Pass, and while we can go and litigate all of its mistakes, its besides the point of the question you're actually asking - is Gamepass's days numbered? The short answer to your question is yes. There is simply a growth ceiling at play for Gamepass that they know they cannot break through. The overwhelming majority of GP users are console users, and they have absolutely no reason to believe that their console audience is going to expand. In fact, all they keep signaling is deeper and deeper retraction in their console marketshare footprint, so unless it takes off in a market sub-sector that it hasn't, like via xCloud and its inclusion with streaming devices and SmartTVs, theres really no chance for it to grow.

I honestly think that the value proposition design of Gamepass is a major part of the problem.

They were attempting to get mass adoption by the "normie gamer" that buys FIFA or COD plus maybe the new Arkham or Uncharted game, but they didn't realize that a lot of those people play Free to Play games like Fortnite etc, and were essentially in no need for a gaming subscription (why subscribe when all your games are free anyways?).

Instead, the service attracted the hardcore audience that buys at least 5-7 games per year plus MTX and completely cannibalized that consumer spend, even worse, this hardcore audience generally knows the ins and outs of buying games, they know how to stack ultra-cheap subscription keys, they know how to use regional pricing to their advantage etc (the last part is the reason why we always see incredible increases in pricing for places like Turkey or Argentina, these two regions in particular are rife for this), so that eroded the hardcore spend even more.

Gamepass will likely be featured in a book at some point as a case of a company completely misunderstanding its market and delivering the wrong value to the wrong audience subset.

No, there is still going to be a machine, but the fanbase really needs to let go of the concept of generations, at least as we were taught to think of them in decades past. This console is meant less as a 'next-gen', despite them using the labelling because they know its what you want to hear, and will act more as a highly niche device for a significantly smaller addressable market than they've ever tried to target in years prior. Gamepass/XBLG still brings in revenue, and the console users who are still sticking around are more than happy to give MS money no matter what, so this is gonna be a product made for them to keep them on the revenue treadmill, as it were.

Its going to be presented as a 'new-generation', but it'll have a price tag that basically spells out what the expectations are for its marketshare footprint, and its going to function in terms of support closer to a Xbox One X or PS4/5 Pro than it will an actual new generation. You're not going to see games from Xbox made specifically for it that aren't also shipping on the XSS/XSX, for example. You're also going to see the few 3rd party titles still shipping on it basically continue to target XSS instead of targetting the machine specifically.

The console will exist as a means for core Xbox users to still have an avenue to keep giving them subscription revenue. Thats it.

I think this plan might not work out the way they want, if they want to sell some sort of $900-1000 device, then they are only funneling more customers to a competitor's offering. Not to mention that the idea that even this machine will be anchored down by the Series S is just incredible. Their competitors must be licking their lips right now.

 

[Varteras]

I honestly think that the value proposition design of Gamepass is a major part of the problem.

They were attempting to get mass adoption by the "normie gamer" that buys FIFA or COD plus maybe the new Arkham or Uncharted game, but they didn't realize that a lot of those people play Free to Play games like Fortnite etc, and were essentially in no need for a gaming subscription (why subscribe when all your games are free anyways?).

This point is exactly why my younger brother dropped Gamepass. He realized that he was only playing Fortnite, Valorant, Warzone, and sometimes Minecraft. He rarely bought games anyway, so it wasn't even like the service was saving him money. He was actually LOSING money paying for a service he hardly used because F2P games made up the large majority of his play time. In fact, the only games he bought this year were Lethal Company and Helldivers. That was a whopping $50 combined, and neither were on Gamepass anyway.

I think this plan might not work out the way they want, if they want to sell some sort of $900-1000 device, then they are only funneling more customers to a competitor's offering. Not to mention that the idea that even this machine will be anchored down by the Series S is just incredible. Their competitors must be licking their lips right now.

I think his point here is Microsoft just isn't even trying to win back marketshare. Their plan is to milk their hardcore fanbase. Enticing them with what is effectively an Xbox Series X Pro. Calling it next gen even though it will not have games made specifically for it, which consumers won't realize that at first, and watching their fans just hand them money for what is virtually no effort on their part to compete. Yes. PlayStation 6 will probably be getting all of Microsoft's games by the time it comes out and will eventually enjoy games made specifically for it that you can't play on PS5. Yes, that means Xbox owners are basically being taken for a ride. Microsoft doesn't care. To them, at that point, their fans are just easy revenue. They'll run that wagon until the wheels fall off. And it'll be a whole generation before the remaining Xbox fans finally catch on. Easy money for another decade.

 

[Edmund]

adamsapple after reading all the posts by S SneakersSO Varteras and Astray

 

[FewRope]

No - with the ATVI merger in particular, Microsoft has essentially cemented that they'll always have a platform. Them pulling out of Windows Phone essentially ensures they won't make the mistake of pulling out of a market completely unless there is simply no other choice to. Their future is 3rd party though, don't get it confused - just because they have a platform doesn't mean they aren't. EA was still a 3rd party publisher in spite of having Origin, same for Ubisoft and their store front, same for ATVI and Battle.Net.

Theres far too much money in being a platform onto yourself to not continue the course on this. They have the Windows Gaming store on PC, they have Battle.net, they have this mobile app store they wanna push. And being a platform also comes with their service offerings, which they aren't gonna give up, even if it does remain this ever-decreasing userbase and service compared to what it was in years prior. Microsoft has, with certain exceptions like the Xbox 360, long been a company where they are less popular than the product they are offering. Windows itself is a shining example of this. For the most part, I think they want to gravitate to a position where their head office folks are far less of a public focal point of business than the games themselves, which is very much how ATVI loved operating, which isn't a coincidence.

I mean, the industry is going to be tumultuous for, i'd say, 3-5 more years. Part of the issue, besides blind faith VC money being injected into it from 2020-2022 on the back of pandemic-driven growth which wasn't sustainable, is that we also had large financial groups that had spokespeople do consultations with publishers and convince them that the future was all live-service GAAS, which is why you saw such an enormous push towards it from basically all major players, while single-player and co-op games basically went through a financial renaissance in the last 6 years. GAAS games require very large dev and live-ops teams in order to come out, and the market simply cannot sustain how many of these titles seek to be an additional live-service pillar. Even the bigger names, like Bungie/Destiny, are still struggling, and so there are a lot of publisher initiatives still playing out where the fruits of those bets, driven by consultants from the financial world who pushed live-service at the expense of everything else, that are yet to crash but are going to. Some folks, like Sony, saw the signs earlier than most and began their pivot away, but we are gonna be a bit before we see the fruits of said pivot, which started happening in 2022-ish.

These consultants that pushed GAAS while down-talking all other genres/experiences still get speaking gigs and are still doing their best to get publishers to stay the course. This is why you have groups like Warner Bros. insisting they still plan on pursuing GAAS despite how absolutely disasterous Suicide Squad and Gotham Knights were. Japan figured it out far earlier though, and are being rewarded for it handily. One of the things that will shore up things as far as labor in the games industry is concerned is the ever-increasing unionization efforts. Lots of big teams are now fully unionized and we're going to be seeing more in the future. The future is still very bright for labor within the games industry, but we're still going to undergo some growing pains before hand.

Just going to say thank you for this kind of posts, incredible articulated and to the point. Xbox users are in for a ride

 

[Astray]

This point is exactly why my younger brother dropped Gamepass. He realized that he was only playing Fortnite, Valorant, Warzone, and sometimes Minecraft. He rarely bought games anyway, so it wasn't even like the service was saving him money. He was actually LOSING money paying for a service he hardly used because F2P games made up the large majority of his play time. In fact, the only games he bought this year were Lethal Company and Helldivers. That was a whopping $50 combined, and neither were on Gamepass anyway.

This is also another thing about Gamepass, it is exceedingly rare to see super successful games like Lethal Company launch on it.

I know a lot of good games did, but nothing that took the world by storm.

The only exception to this is Palworld.

I think his point here is Microsoft just isn't even trying to win back marketshare. Their plan is to milk their hardcore fanbase. Enticing them with what is effectively an Xbox Series X Pro. Calling it next gen even though it will not have games made specifically for it, which consumers won't realize that at first, and watching their fans just hand them money for what is virtually no effort on their part to compete. Yes. PlayStation 6 will probably be getting all of Microsoft's games by the time it comes out and will eventually enjoy games made specifically for it that you can't play on PS5. Yes, that means Xbox owners are basically being taken for a ride. Microsoft doesn't care. To them, at that point, their fans are just easy revenue. They'll run that wagon until the wheels fall off. And it'll be a whole generation before the remaining Xbox fans finally catch on. Easy money for another decade.

Yeah I got that, but I don't think even the hardcore of the hardcore, the console warriors on Twitter, are jumping ship one by one already (just look at Timdog of all people going full on PS5 warrior, that guy is honestly my 1st thought as to who would buy a $900 not-Xbox). That market is shrinking as it is, and trying to transparently squeeze them could have adverse reactions on the targeted segment.

And weirdly enough, their Series S|X push worked along similar lines: No new controller, no new experiential features (like the haptic thing Sony did), not even a new UX either and basically no exclusives for the two consoles.

The other thing I want to point out is that Xbox has utilized leaning on the community to promote their stuff or to sweep up after their messes, but this entire course of action they're undertaking is ridiculously disrespectful to the fanbase.

Never before have I seen such a level of disrespect (snd almost contempt) to the consumer base in any entertainment segment.

 

[Varteras]

This is also another thing about Gamepass, it is exceedingly rare to see super successful games like Lethal Company launch on it.

I know a lot of good games did, but nothing that took the world by storm.

The only exception to this is Palworld.

Yeah I got that, but I don't think even the hardcore of the hardcore, the console warriors on Twitter, are jumping ship one by one already (just look at Timdog of all people going full on PS5 warrior, that guy is honestly my 1st thought as to who would buy a $900 not-Xbox). That market is shrinking as it is, and trying to transparently squeeze them could have adverse reactions on the targeted segment.

And weirdly enough, their Series S|X push worked along similar lines: No new controller, no new experiential features (like the haptic thing Sony did), not even a new UX either and basically no exclusives for the two consoles.

The other thing I want to point out is that Xbox has utilized leaning on the community to promote their stuff or to sweep up after their messes, but this entire course of action they're undertaking is ridiculously disrespectful to the fanbase.

Never before have I seen such a level of disrespect (snd almost contempt) to the consumer base in any entertainment segment.

I mean, you kinda pointed out right there the whole underlying issue. Microsoft just doesn't care at this point. They're just throwing hardware out there to continue squeezing money off any willing to pay. There's no real expectation of good success. Just seeing who they can squeeze. Of course, assuming this is all true.

 

[ChorizoPicozo]

adamsapple after reading all the posts by S SneakersSO Varteras and Astray

Not even a laughing emoji... . you know shit is serious

 

[Edmund]

Not even a laughing emoji... . you know shit is serious

Someone check if adamsapple is ok.

 

[adamsapple]

Someone check if adamsapple is ok.

Preparing for Game Pass's funeral or something

 

[ChorizoPicozo]

Preparing for Game Pass's funeral or something

yep. those Microsoft rewards are keeping you busy-busy-busy