Mobilemofo
Member
Lot of cash, so where's the games?
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Xbox Game Pass generated $2.9b revenue in 2021
- Thread starter Banjo64
- Start date
ZehDon
Member
... where's the games on Game Pass? They're... on Game Pass?
All analysis is speculation based on available data. I've built you a model based on the noted revenue and Microsoft's assertion that the software business is profitable. The infrastructure costs aren't an assumption: game pass uses Microsoft accounts and the same CDN as used by the existing storefront. How would you carve out the gamepass specific costs for utilizing existing resources?
2,900 Million is a lot of money. Gamepass alone generates more revenue than Ubisoft or Square-Enix. Profitability isn't a question. The question is the magnitude of profit.
S0ULZB0URNE
Member
Bingo
Kagey K
Banned
No not those games silly. The other games.
IndianaJack
Banned
You'll be singing a different tune in 12 months.
freefornow
Member
Is that exclusive?
TheThreadsThatBindUs
Member
Well, something has got to pay for that Activision-Blizzard acquisition.
I've been playing more games than ever recently thanks to Game Pass. They've been hitting it of the park for a long time now, it's why people sig its praises.
IndianaJack
Banned
I guess 'lack of games' = no GoW Ragnarok.
adamsapple
Or is it just one of Phil's balls in my throat?
They announce batches of game pass games twice a month.
I'm legit surprised you missed it over the years somehow.
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Topher
Identifies as young
Right here:
Xbox Game Pass Games Library | Xbox
Explore the Game Pass library and play hundreds of games.
www.xbox.com
S0ULZB0URNE
Member
Trazyn the Infinite
Member
It is clear you are referring to exclusives and that is a major issue for Xbox (of course the Xbox Warriors are trying to spin this as, “lol there are plenty games on GamePass!”). They have a ton of games in development, but the few that have come out are completely and utterly trash (Halo Infinite) or mindlessly forgettable (Forza Horizon 5). Though you do have the occasional fun, but nothing spectacular game as well (Grounded). But they are very few and far between.
I will say that GamePass is an excellent deal and offers a ton of games, most of which aren’t exclusive in any way, shape, or form to the platform - but the choices for the low price are excellent. While this is nice as a way to tide people over - I do want to see actual exclusives come out at a greater pace than the glacial one they have set.
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MarkMe2525
Gold Member
This doesn't look very sustainable.
Ozzy Onya A2Z
Member
Yep. Pretty insane to sit there and argue blatantly incorrect statement, it's been a long time since Xbox had no games of quality. I've posted a couple of rebuttal lists this year already here on GAF but anyone should just checkout the Gamepass OT as it's everchanging.
Friends, family (kids and us parents too) as well as myself have all been playing more genres and games than ever. Gamepass has been insanely great value, so much so that we have a circle of Xbox friends that gift games or MTX to each other on an ad-hoc rotation so we all play together and don't miss out.
Here's usual hitlist ranking of top 10 from this year to date with Gamepass -
- Forza Horizon 5
- Halo Infinite (Campaign)
- No Man’s Sky
- A Plague Tale: Innocence
- Star Wars Jedi: Fallen Order
- Skyrim
- Death’s Door
- Control
- Mass Effect: Legendary Edition
- Subnautica: Below Zero
- Halo MCC
- Slime Rancher 2
- Chivalry 2
- Deathloop
- The Gunk
- Watch Dogs 2
- As Dusk Falls
- Power Wash Sim
- Far Cry 5
- Ninja Gaiden Master Collection
- TMNT Shredder's Revenge
- MS Flight
- Sea of Thieves
- Ass Creed Origins
- Tunic
- Shredders
- Marvel GofG / Avengers
- Maneater
- Firewatch
- MK11
- Aliens Fireteam Elite
- Unpacking
- It Takes Two
- Psychonauts 2
- The Ascent
- Gears of War 5/Ultimate
- Overcooked 2
- Grounded
- Minecraft
- Ni No Kuni: Wrath Of The White Witch
- Two Point series
- DOOM eternal
- Hades
- Monster Hunter World
- Ori series
- Titanfall 2
- Yakuza series
- Among Us
- Age of Empires 4
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Trazyn the Infinite
Member
And the highlighted are exclusives while the rest can be played on other platforms. Which is what was clearly being referred to when the statement was made. But then again, there is not much to expect from a warrior trying desperately to dismiss reality and push strawman arguments.
adamsapple
Or is it just one of Phil's balls in my throat?
Balducci30
Member
I mean 2.5 billion revenue I highly doubt qualifies as hemorrhaging - are we thinking it’s over 5 billion a year to maintain?
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Sir Vilhelm
Member
Damn that's a lot of profit
With 2.9 billion dollars, Microsoft could have given each of the 330M people living in America a million dollars and still had
left over. Why aren't more talking about this?
With 2.9 billion dollars, Microsoft could have given each of the 330M people living in America a million dollars and still had
left over. Why aren't more talking about this?
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SportsFan581
Member
Googled it and @Dick Jones seems to be correct. Discounts are deducted from gross sales.
"Net sales is the sum of a company's gross sales minus its returns, allowances, and discounts."
:max_bytes(150000):strip_icc()/netsales.asp_finalv3-0ac022b843c14671a2bf0cd51515e020.png)
Net Sales: What They Are and How to Calculate Them
Net sales are the result of gross sales minus returns, allowances, and discounts. They are a factor in gross profit but do not include costs of goods sold.www.investopedia.com
I don't think they are referring to discounts there in the way that it is being talked about in this thread. In many cases you are going to give discounts after the full funds have been collected, say stores buy shipments of Xbox systems and then MS does a price drop and they get credits/discounts, or if there was some other enforced price change. But, I have no idea. And then you have coupons etc. which are real expenses paid out to retailers. Crazy way to do it if the money was never collected in the first place, but I'm not an accountant. LOL
In any case the $1 promo is a discount for GP just for that first month in a literal sense. Gamers buy gold at regular prices (unless they get from a key seller or something like that), the rest is just an upgrade.
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AmuroChan
Member
I do, but I already know what the other segments are making. GP could be MSFT's next golden goose, and that unknown is what interests me most as a stockholder right now.
EA as a whole spends 1.4 Billion dollars on cost of sales and around 2.8 Billion on operations. 5 Billion dollars per year on Game-pass would be a stretch for a service which operates on top of an existing organization. The exact answer will never be known since Microsoft only releases revenue/net income details at the business unit level.
There is absolutely nothing wrong with posting it. Some data is better than no data.
Your dog obeys you?
TwiztidElf
Gold Member
Rewarding mediocrity.
If the future of gaming is quantity over quality, I weep.
If the future of gaming is quantity over quality, I weep.
StreetsofBeige
Gold Member
The stuff you and the others above talking about revenue and discounts to final customers will likely go like this. Granted, I dont work in direct to consumer models or in software or sub plans. But the shit we sell is to retailers and wholesalers, but the methodology should be the same.
Discounts and promotional rebates and coupons are applied as a cost after gross sales. These costs along with other stuff gets all factored in to get to Net Sales. Each company does it slightly different, so there may also be a sub line which called something like Net Realized Revenue which only factors in some costs.
Regardless, I'll assume the $1 deal is similar to supplier to retailer models.
The full gross sales will be applied and promotional costs/revenue reductions will be applied after regardless of whether the deal price is applied right away or it's something like a coupon redeemed where a customer gets it later.
I might be wrong, but assuming it's a 1 year GP $1 deal, it might look something like this:
Gross Sales $180
Promotions -$179
Net Sales $1
(this assumes no other costs involved for sales of simplicity).
There are times a company can mess around with the pricing to set it at $1 straight up or dirt cheap, but in this case it shouldnt apply since it's an existing product with a standard price. For example, one thing companies do with multipack products is set them at insane discounts. Another way (shady) is to set gross sales of products and services oddly high, with an equally absurd high discount price. That's when you get into accounting irregularities. As an example, a reasonable price to sell a can of soup is $3 with a 50 cent promo. $2.50 net. You'd get into trouble with the law if a company sold the same can of soup at all times for $10 to boost the top line with a $7.50 promo to get to the same $2.50.
The GP $1 deal is ok as it's a special promo bundled together, while also still selling GP separately on its own at regular prices.
Robbinhood
Banned
Sounds like it’s mostly Gold users converted to GP. Not enough to sustain a massive first party lineup with day 1 releases. Sony makes like 3.5b a year on plus, they wouldn’t be able to release all first party day 1 without going bankrupt. There’s probably a magic number MS needs to hit to make this all work, they know what it is but we don’t. I wonder if they can get there.
MatrixReloaded101
Member
Yup ^Me waiting to see how much profit GP generated while watching the usual suspects pretend revenue is profit.
I feel bad for Xbox fans because the convo around the brand has just been about business instead of actual video games.
StreetsofBeige
Gold Member
Sony makes about $3 billion profit a year from their gaming division. Free first party sales would barely make a dent into that $3 billion/year.
StreetsofBeige
Gold Member
It's actually the other way around. The majority of MS talk is Game Pass, and more games from Bethesda/Activision. Most of heated Sony talk is about $70 games, $10 upcharges, sales list wars, PC port strategies, and the latest big news of GAAS games being a day one strategy.
Chukhopops
Member
Why do people ignore the other 82% of MS’ gaming revenue?
If GP brings 2.9bn and total revenue is 16bn then there are other revenue sources, such as selling games, platform income from 3rd party sales, etc.
All this data does is shoot down forever the idea that people get GP for free or for €1, since even if you take the highest possible sub number that’s still 116 usd per year per subscriber (without PC).
It’s nice to see some dumb arguments being removed from the discussion once in a while.
DevilHunterX0
Member
This should be the new Xbox slogan.
8BiTw0LF
Consoomer
1 million x 1000 = 1 billion..Damn that's a lot of profit
With 2.9 billion dollars, Microsoft could have given each of the 330M people living in America a million dollars and still had
Why would this count towards GP revenue?
Subscription revenue, so unless you imagine the subscriber count’s been dropping - Which is very unlikely - they should be on course for a better 2022
Until you realise it's mostly the xbox fans talking about $10 surcharges, and $70 games, and "Sony's gamepass" strategy.
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Kagey K
Banned
It ends a lot of discussions regarding subscription services
That's actually an expense. Nowhere would it ever be counted as revenue except on Big Cheese Studio books.
Are you high?
pasterpl
Member
People asking about games, there is scorn, plague tale 2, high on life etc. coming to gamepass very soon. There are shit loads of new games coming to gamepass each month for both pc and console, most are cloud playable as well. Gamepasss is full of excellent games already, on top of this there are monthly addditons, usually mix of AA-AAA. We know that all ms titles hit gamepasss day 1 and stay on service forever. Ms was publisher of the year last year and all of these highly rated and critically acclaimed games are on gamepass and will stay there forever. You have to be an utter fanboy not to see value in this service.
bender
What time is it?
Like PAW Patrol: Grand Prix
Like PAW Patrol: Grand Prix. It's GRRRRReat.
Yeah, right.
Subscription services are notoriously sticky, games like Forza Horizon 5, Halo Infinite and MLB would have brought in a lot more subscribers for 2022 , and a major driver for Gamepass subscription increase is sales of Xbox Series consoles which ramped up in 2022.
Extremely unlikely the revenue drops anytime soon.
Kagey K
Banned
Every game added is for you. How dare they branch out to try to include everyone in the family.
Why did you skip the other games added?
You joke, but I recall the posts here sneering at Disney Dreamlight Valley. And yet it’s been a significant hit across Gamepass, Steam, PSN etc.
family friendly content is VERY important for services like these.
Not to mention the existing games on the service that folks keep playing. Many People are paying for access to a library of games, and not just the month-to-month releases.
Chukhopops
Member
« The amount MS paid counts towards its revenue »
And this is the MBA gamers we are supposed to argue with…
Dolomite
Member
Lol the copium is delicious. If MS' Debt +TIBDA (Debt + earnings before taxes, Interest, depreciation, and amortization or...profit) was as high as 1:2 they'd STILL be raking in 1.5 B's annually from Gamepass on consoles alone. They can quite literally afford to make this service too good to be true for a very long time.
Kagey K
Banned
IRS wants this guy auditing taxes. Every dollar spent is added to revenue. So pay tax when you earn it and pay tax when you spend it.
Jeaus.
bender
What time is it?
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pasterpl
Member
https://news.xbox.com/en-us/2022/10/04/game-pass-october-2022-wave-1-announce/
More like scorn, plague tale 2, naraka, Valheim, grounded, dark tide, persona 5, high on life drops in December, atomic heart should be out this year as wlll. we have just got deathloop as well. Next year is even more impressive with stalker 2, forza motorsport, starfield, wo long, ark2 and many more. But kudos to you if you like paw patrol and missing on all of the games I have listed
Games going to gamepass are marked with gamepass above the thumbnails;
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