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[DenchDeckard]

Watch when it’s 8 percent in two years…then 16…

this is how it works. Also, which services are they comparing? And is it 4 percent of all gaming revenue including mobile? Because that would be quite considerable.

 

[Muddy]

Lol, some people dont learn.
Go check those funny discussions some years ago about: "Digital distribution will never overpass physical because X Y and Z".
Here we go again.

Pandemic played a huge part in it.

Personally, I am back to buying physical again. At least i can get some money back after playing a game. Especially 70 pound PS5 games.

Anyway back to topic, It is 4% of the market or 3.7 billion.

Come back to me when it gets close to 81 billion.

Microsoft currently has 60% of the 3.7 billion with 25 million subcribers. It will need 150-200 million subscribers to get even close to 81 billion and be the majority. No chance.

Edit - Didn't Microsoft themselves say Gamepass subscriptions alone isn't enough revenue?

 

[JLB]

Pandemic played a huge part in it.

Personally, I am back to buying physical again. At least i can get some money back after playing a game. Especially 70 pound PS5 games.

Anyway back to topic, It is 4% of the market or 3.7 billion.

Come back to me when it gets close to 81 billion.

Microsoft currently has 60% of the 3.7 billion with 25 million subcribers. It will need 150-200 million subscribers to get even close to 81 billion and be the majority. No chance.

Edit - Didn't Microsoft themselves say Gamepass subscriptions alone isn't enough revenue?

I have the impression Ill come to you sooner than you might guess.

 

[Muddy]

I have the impression Ill come to you sooner than you might guess.

25 million Gamepass subscribers.
50 million PS Plus subscribers.
32 million Nintendo Switch subscribers.

Generating 3.7 billion or 4% of the market.

There aren't enough gamers on the planet to get near 81 billion.

 

[Captain Toad]

Electric cars were also a minimal % of total car sales just 2 years ago.


People who deny that subscriptions are the future are delusional

It's the physical vs digital all over again

Sure, Jan.

 

[adamsapple]

So much for Gamepass being the future.

That's the thing about the future. It's not what's happening right now.

Give it 10 years, it will grow to 30%

Could be sooner depending on how/if Sony and Nintendo also adapt it.

 

[thicc_girls_are_teh_best]

We can actually use this to determine how much revenue GamePass generated prior fiscal year.

The console gaming market generated about $80 billion in revenue last fiscal year, right? It might've been a bit more than that in actuality. Recently, it was shown GamePass having roughly 60% of the gaming subscription market (of the GamePass type, not PS+/XBL Gold etc.).

Assume that ratio is global, which probably isn't that far off from the truth. So if these services accounted for 4%, that's $3.2 billion, and if GamePass is 60% of that, that's a revenue of $1.92 billion the last fiscal year.

If Xbox generated $16.5 billion last fiscal year (I'm just guessing numbers close to what I saw, can't remember specific numbers quoted), GamePass accounted for roughly 11% of that revenue.

$1.92 billion with 25 million subs is an average of $6.4/month for the full year. That seems pretty good, but...the average monthly cost of GP (between GP & GPU) is $12.50 (15 + 10 = 25/2 = 12.5), not $6.40. So that might also tell us something else, that (obviously) not all 25 million subs are paying the regular rate or for the full year, otherwise revenue from GP alone would be $3.75 billion annually, while the actual amount is slightly above half of that.

Whether that means only half of 25 million are paying the full normal amount between regular GP & GPU, or more are paying throughout the year but not paying the full year, we might at least have a better idea now how many are paying via $1 conversion, using free trails, or using Reward points. Is any of this bad news? Not necessarily, but that'd depend on what money is being spent by subscribers on MTX, DLC content etc. for games through the service. And at the end of the day, it's still some revenue. It's still some profit. That's better than what it'd be without having GamePass whatosever

...also I don't know how they're claiming these services generated $3.7 billion when they claimed it was 4% of ~ $81 billion. It'd have to be closer to $92.5 billion for 4% to equal $3.7 billion. C'mon bruh...

 

[SteelCurtain 59]

What proportion of the console market revenue are they though? Nobody cares if Mobile and Steam users aren't invested in subscription services because for the most part they don't exist in those ecosystems, it's just an incredibly biased sample to look at when the vast majority of gaming revenue is on platforms that don't have any notable subscription services

 

[JLB]

Anyone knows what "Other" refers to?

 

[Swift_Star]

What proportion of the console market revenue are they though? Nobody cares if Mobile and Steam users aren't invested in subscription services because for the most part they don't exist in those ecosystems, it's just an incredibly biased sample to look at when the vast majority of gaming revenue is on platforms that don't have any notable subscription services

There are game subscriptions in android and iOS. For the most part… they exist in these ecosystems.

 

[JLB]

25 million Gamepass subscribers.
50 million PS Plus subscribers.
32 million Nintendo Switch subscribers.

Generating 3.7 billion or 4% of the market.

There aren't enough gamers on the planet to get near 81 billion.

Wondering what is that 81billion figure. I have the suspicious that maybe its mostly MTXs, though please correct me if im wrong.

 

[Warablo]

Now ask how many consumers have a subscription account in general. I dare say it's like 85%+. In fact if you count mobile phones its probably 95%.

Cable, phones, music, movies all these services want your subscription money.

 

[Leyasu]

It's as if someone said make a thread that was the definition of desperation. Everyone desperately fighting their position...

When you sign up, they are getting you to pay upfront for content. They are using your money to help mitigate their risks. And in return, you get games. Are they the future of the industry? Probably not, as games will always be for sale. Will be there in the future? Of course they will, for the guaranteed money that they provide.

 

[ethomaz]

I assume this is including mobile? Because that makes a massive difference.

Include mobile makes no sense… only in 2021 was 52% or $92b of total gaming spending.

$81b looks like the 48%.

That overall number Includes mobile, Steam, MTX and retail.

Not unexpected that subscription services don’t command a huge part of that revenue.

That doesn’t make sense… gaming mobile alone was $92b last year.
Sony gaming revenue alone was over $20b.

 

[chonga]

Watch when it’s 8 percent in two years…then 16…

this is how it works. Also, which services are they comparing? And is it 4 percent of all gaming revenue including mobile? Because that would be quite considerable.

Maybe we need some more pandemic-free time, but GP new user growth is already slowing down. Based on the standard adoption curve that means they're about to hit peak adoption soon.

 

[Kiddo Cabbusses]

This seems like a low percentage considering subscription-based services in general are two console gens old. I would have expected it to be at least 10 percent based on how much these services get hyped up.

 

[JLB]

Anyone knows what "Other" refers to?

I think this guy is asking the real question here.

 

[Shmunter]

No wonder Phil is backtracking on the Gamepass future. Let’s not mince words, this was the single focus till recently. All those acquisitions going into an all you can eat probably are looking scary on the balance sheet with the relatively small sub numbers.

So what needs to happen - an explosion in subscription together with a price adjustment - but looks like it’s not so easy to get that magic balance. Raise the price, stifle numbers, lower the price and you’re not making any profit.

Fully expecting bathesda, Activision, etc games to come to all platforms within some considered timing window to keep revenue where it needs to be.

I theorise people are too busy with the bounty of free to play GaaS games to also subscribe to something else on top. These people however are potentially motivated to occasionally spring for a top tier release outright to complement their online service game.

 

[Jaybe]

Phil convinced Satya that 100 million people from India would sub to Game Pass to stream through their phones.

 

[Jaybe]

I theorise people are too busy with the bounty of free to play GaaS games to also subscribe to something else on top. These people however are potentially motivated to occasionally spring for a top tier release outright to complement their online service game.

This. So many people get all their gaming needs fulfilled by playing 1 to 3 games constantly. Then you have folks that will buy lengthy single player games that eat up a couple months of playtime thereby making a sub an unused expense. There’s a market for subs but they will hit a ceiling lower than some anticipate.

 

[Lognor]

No wonder Phil is backtracking on the Gamepass future. Let’s not mince words, this was the single focus till recently. All those acquisitions going into an all you can eat probably are looking scary on the balance sheet with the relatively small sub numbers.

So what needs to happen - an explosion in subscription together with a price adjustment - but looks like it’s not so easy to get that magic balance. Raise the price, stifle numbers, lower the price and you’re not making any profit.

Fully expecting bathesda, Activision, etc games to come to all platforms within some considered timing window to keep revenue where it needs to be.

I theorise people are too busy with the bounty of free to play GaaS games to also subscribe to something else on top. These people however are potentially motivated to occasionally spring for a top tier release outright to complement their online service game.

Doubt it. Between Xbox, PC and streaming there is more than enough people to get Game Pass subscriptions to where Microsoft eventually wants them. Bethesda and Activision were already not coming to Switch, mostly. So you're talking about PS5 ports. Nope, not going to happen. Microsoft didn't spend all this money to put these games on PS5. Not how it works. Now if Sony opens the door to them for Game Pass they probably would. That's win/win for Microsoft. But it doesn't sound like Sony will allow that to happen. So no Bethesda or Activision games coming your way on PS5.

And there is a reason that Sony is switching things up with PS+. There is a ton of money to be made on these subscription services. Sony saw what MS was pulling in on Game Pass and they want some of that sweet action. PS Now by itself was a joke so they knew they had to roll it into PS+. That was obvious. There is a reason Sony is making these changes. It is the future. Sony finally sees that. Microsoft has the first mover advantage. We'll see if Sony can catch up.

 

[kyliethicc]

25 million Gamepass subscribers.
50 million PS Plus subscribers.
32 million Nintendo Switch subscribers.

Generating 3.7 billion or 4% of the market.

There aren't enough gamers on the planet to get near 81 billion.

Only caveat is the 4% is for North American and European markets.

Those sub numbers are global.

Just a heads up.

 

[FrankWza]

 

[Rivet]

Watch when it’s 8 percent in two years…then 16…

Yes, we'll see when it reaches 16%, if it ever happens... Right now it's at 4% and not many people seem to care outside of the 10 same fans posting about it on GAF every day.

 

[Pedro Motta]

And according to Michael Patcher PlayStation will cease to exist by 2026 due to Gamepass, when Sony makes way more money than MS even with game subs. Jimbo must be afraid and crying. 'Desperate' as Patcher said. #SureJan

I don’t believe people are this dumb. I do believe people are paid to say dumb shit like this.

 

[Rivet]

That's the thing about the future. It's not what's happening right now.

Last time Microsoft predicted the future, it was Ballmer laughing at the launch of Iphone. They don't really have a great record at predicting future.

 

[ethomaz]

Last time Microsoft predicted the future, it was Ballmer laughing at the launch of Iphone. They don't really have a great record at predicting future.

Ballmer really laughed at the first game iPhone? Shocked.

I have no ideia how I could use cellphones before touch screen with iPhone… it was just bad in ridiculous level.

For me the first iPhone was the best creation of this millennium… like the wheel was to Rock Age… it will take decades to have a biggest change like it was.

Maybe there is change if humanity invents the teleport.

 

[S0ULZB0URNE]

Just 4%?

Lmao

 

[remember_spinal]

 

[adamsapple]

Last time Microsoft predicted the future, it was Ballmer laughing at the launch of Iphone. They don't really have a great record at predicting future.

When your biggest competitor rebrands and launches what many call a directly competing service, you know you're doing something right.

 

[MScarpa]

Pandemic played a huge part in it.

Personally, I am back to buying physical again. At least i can get some money back after playing a game. Especially 70 pound PS5 games.

Anyway back to topic, It is 4% of the market or 3.7 billion.

Come back to me when it gets close to 81 billion.

Microsoft currently has 60% of the 3.7 billion with 25 million subcribers. It will need 150-200 million subscribers to get even close to 81 billion and be the majority. No chance.

Edit - Didn't Microsoft themselves say Gamepass subscriptions alone isn't enough revenue?

Just wondering what does the 81billion number represent?

 

[remember_spinal]

When your biggest competitor rebrands and launches what many call a directly competing service, you know you're doing something right.

I think its more telling their competitor went out and spent 100 million dollars of getting exclusive software

Seems like at the end of the day, games are still what matter, looking at whats selling

 

[adamsapple]

I think its more telling their competitor went out and spent 100 million dollars of getting exclusive software

Seems like at the end of the day, games are still what matter, looking at whats selling

Of course, what are subscription services if not avenues to get people hooked onto an easily accessible ecosystem of games.

No arguments from me there.

 

[eNT1TY]

They are playing the long game, it needs to start somewhere. This number will be wildly different in 20 years.

 

[Shmunter]

Doubt it. Between Xbox, PC and streaming there is more than enough people to get Game Pass subscriptions to where Microsoft eventually wants them. Bethesda and Activision were already not coming to Switch, mostly. So you're talking about PS5 ports. Nope, not going to happen. Microsoft didn't spend all this money to put these games on PS5. Not how it works. Now if Sony opens the door to them for Game Pass they probably would. That's win/win for Microsoft. But it doesn't sound like Sony will allow that to happen. So no Bethesda or Activision games coming your way on PS5.

And there is a reason that Sony is switching things up with PS+. There is a ton of money to be made on these subscription services. Sony saw what MS was pulling in on Game Pass and they want some of that sweet action. PS Now by itself was a joke so they knew they had to roll it into PS+. That was obvious. There is a reason Sony is making these changes. It is the future. Sony finally sees that. Microsoft has the first mover advantage. We'll see if Sony can catch up.

Microsoft like any other company has a single goal when they invest. A return on investment, whatever that may look like.

 

[Swift_Star]

That's the thing about the future. It's not what's happening right now.




Could be sooner depending on how/if Sony and Nintendo also adapt it.

gamepass is happening now, though. And it has been for the last few years. And it hasn’t changed anything.

 

[Swift_Star]

They are playing the long game, it needs to start somewhere. This number will be wildly different in 20 years.

Will it, though?

 

[dorkimoe]

a lot of people have this mentality that they have to buy the most expensive edition or buy a full copy to "support the devs". Youll quit thinking that someday, I assure you.

 

[Silent Viper]

81 billion includes microtransactions as well

 

[adamsapple]

gamepass is happening now, though. And it has been for the last few years. And it hasn’t changed anything.

25 million subscribers on what is the lowest selling console of the big 3 in 4~ years is not nothing.

A number which will increase and lead to a higher percentage of subscription adaption owing to more studios and games coming under the banner in the coming months/years. Factoring in Sony joining the party it will only cause the increase to be an exponential increase.

This isn't a short term thing, but it is inevitable.

They are playing the long game, it needs to start somewhere. This number will be wildly different in 20 years.

I think you're being too generous with the 20 year estimate. I'm guessing it'll be sooner than that.

 

[Bryank75]

The thing is.... gaming subscriptions do not exist in a vacuum.

Most people have 1-3 TV/Film streaming subscriptions, spotify, office, youtube, twitch, news and other subscriptions..... we are at the point of subscription overload.

and frankly, how does turning your hobby into a monthly bill not feel like less fun? An obligation rather than a joy.....

Netflix numbers are going down, not up. All tastes can never be catered for in an economic way within a subscription and it would only limit choice and shrink the industry that way anyway because games are not really being rewarded on individual merit or innovation but collective value.

 

[zeorhymer]

That's far from the 20% that I was expecting. I guess since it's only in the US and Europe, there's a lot of other countries that don't have subscriptions available yet.

 

[ArtHands]

bUt itS tHe FutUrE!!

Now seriously...when i mentioned the bubble videogame forums live in, this was what i meant.

This is almost the exact same post regarding digital gaming a decade ago.

 

[ZoukGalaxy]

Well, still no thanks, I'm happy not being part of these 4% rental slaves
I prefer to own my things.

 

[yurinka]

25 million Gamepass subscribers.
50 million PS Plus subscribers.
32 million Nintendo Switch subscribers.

Generating 3.7 billion or 4% of the market.

There aren't enough gamers on the planet to get near 81 billion.

3.7B/year is aprox. what Sony's game subscriptions generate according to Sony.

 

[Bryank75]

3.7B/year is aprox. what Sony's game subscriptions generate.

Globally though.... I think the figures are US and Europe only.

 

[yurinka]

Globally though.... I think the figures are US and Europe only.

Ah, true. Forgot that.

 

[StreetsofBeige]

So GP's 25 million subs is 60% of $3.7 billion. That's $2.22 billion.

Dividing $2.22 billion / 25 million subs = $88.80 revenue per sub. So right in the middle of an annualized $180/yr sub plan. And that assumes all 25 million subbers are NA/Europe. Xbox is weak in other regions, but the rev/user is even higher if NA/Europe GP users are lets say 23 or 24 million.

I thought GP were all $1 subs? So even with all the $1 sign ups weighing down the average, about $90/yr is even higher than PS+, PS Now, or Xbox Gold at regular price.

The remaining $1.5 billion is then split across PS+, PS Now, Nintendo and Xbox Gold. Who knows what the split is, but PS+ is going to be most of it.

 

[NikuNashi]

Games are not movies and Tv, they are fundamentally different.

I played SFIV everyday for 8 years (bought 3 different full price boxed versions in that time). They are not throw away, watch once and never watch again junk entertainment like Netflix. This is why the subscription idea doesn't apply.

Maybe casuals with attention spans of goldfish might enjoy gamepass, but any self respecting gamer wants to purchase and play their own games, often for months / years at a time like me.

 

[Shmunter]

So GP's 25 million subs is 60% of $3.7 billion. That's $2.22 billion.

Dividing $2.22 billion / 25 million subs = $88.80 revenue per sub. So right in the middle of an annualized $180/yr sub plan.

I thought GP were all $1 subs? So even with all the $1 sign ups weighing down the average, about $90/yr is even higher than PS+, PS Now, or Xbox Gold at regular price.

The remaining $1.5 billion is then split across PS+, PS Now, Nintendo and Xbox Gold. Who knows what the split is, but PS+ is going to be most of it.

Those numbers don’t stack up. Gamepass is available for a fraction of the West’s price in 3rd world countries. People there are not paying these prices.

Doesn’t take much to see as there is no shortage on ways to game the system via vpn purchases of gamepass subs to drop into ones account.