Xbox Predicts 'Hardware Decline' Despite Huge Revenue Boost From ActiBlizz
Xbox Predicts 'Hardware Decline' Despite Huge Revenue Boost From ActiBlizz
- Thread starter AdrianH
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MarioAna
Esteemed member
They would be leaving way too much money on the table if they put CoD on GP properly. And GP without CoD could feel like a bit of a cheap move by MS after all the talk.
Maybe. Subtract the Xbox owners who already have a PS, and those that have a PC first.
OP
AdrianH
Administrator
This is my sentiment exactly.
Along with the need to not require gaming hardware as streaming will become large.
xCloud works very well for me the few times I have used it, they just need to get to 4k HDR at 60fps, and then I'll be happy , probably a few years away though.
I think they must get away from platform exclusivity now. Carrot for brand fans should be a title is available on that particular platforms subscription service, otherwise you can buy it to own for another platform. Cross platform play must be the new norm.
Seeing rumours the big wigs are considering launching Indiana Jones on PS5 as well. I hope they do. Being back on PC makes me want us all to have access to everything.
Think I can put this here
If Xbox 1st party games come to other platforms a year later and the funds are used to improve Xbox games and hardware in the future then I'm all for it.
But those rumours of COD not coming to Gamepass are dumb if true. Why buy a massive franchise to have zero benefit to your users.
I'd rather they keep COD on PS5/Switch2 to keep the profits coming in so they can put COD on GP and afford the loss of sales on the Xbox side.
But those rumours of COD not coming to Gamepass are dumb if true. Why buy a massive franchise to have zero benefit to your users.
I'd rather they keep COD on PS5/Switch2 to keep the profits coming in so they can put COD on GP and afford the loss of sales on the Xbox side.
MarioAna
Esteemed member
Vomit.
It will never be as good as local play. Just think about how many people complain about dropped frames, resolution drops etc. Especially lag, people pay big money on monitors and TVs to eliminate lag and now we think streaming will be good enough?
All Sony has to do then is make a console of any kind and they will own the market.
MarioAna
Esteemed member
To make money for your investors? The very people who gave you the $80b to make the purchase.
MS have to come out and say something. If it’s just rumors then squash them now. If not, come up with a narrative because left to us, we’ll come up with crazy ideas.
OP
AdrianH
Administrator
It's inevitable that gaming will become majorty subscription based to be played via streaming. This is seen all over the audio/visual industry, over recent years and gaming is now heading there. Hell, even books are available on subscription now [emoji4]
Not to say that local native gaming won't exist, but I have a feeling that it will be purely for PC hardware only. Consoles will become a relic of the past.
I don't see that being a requirement at all.
Game Pass is a volume argument and they got more than enough of that.
We haven't "owned" anything for a great many years, it switching to a subscription makes very little difference.
If anything it gives you choice because you can turn it off at any time you feel like it and use a different one or just take a break or whatever.
We are at the point where even car ownership is falling away and opting to a subscription/hailing service model instead.
If only Microsoft got their digital message out better pre Xbox One launch so it was fully understood the world would have been much better for it right now.
KenMasters
Super Moderator
Doubt they do, streaming services in general don't break even, don't see why Game Pass should be the exception.
The strategy relies on perpetual growth and I believe Game Pass' figures have stalled. Besides, in general investors have become weary of the model across mediums. The heyday of the subscription model for entertainment is over.
MarioAna
Esteemed member
Subscription yes. Streaming no.
The others don’t require any kind of interaction, the technology is not remotely the same.
Everything is a profit argument. And if GP was profitable now and for the future then none of this would be playing out as it is. MS would just stick CoD on there and be done.
JoE
Established member
I think MS expected a more even playing field this gen with GP taking off to bridge the gap but the whole digital library built up in the last gen meant that most PS players didn't switch back to xbox this gen and those that did only did so because of the PS5 shortages. Now that that's stabilised we're seeing this decline which like the article states was expected.
I agree the way forward is gp day 1 on whatever device they can ship on with secondary income via separate release on other platforms. However, I don't think that they should limit that exclusivity based on time. The pro is that if you're on gp there's no need to buy that first party title so the incentive to get gp is increased as an annual sub to gp is the same price as the individual title itself. I'm sure ms has probably already pivoted to this thinking and is making the moves to get it in place.
GP on every device is the end game and the benefit is mutual so I'm sure there's a deal with the big players down the line. If I'm not mistaken, the xbox cloud app already ships on samsung tvs in the us so its bound to progress with broadband penetration globally.. ms just needs to put their azure servers to good use and it could work with a shift in balance geographically with office priority during work hours and xbox outside of those times.
I agree the way forward is gp day 1 on whatever device they can ship on with secondary income via separate release on other platforms. However, I don't think that they should limit that exclusivity based on time. The pro is that if you're on gp there's no need to buy that first party title so the incentive to get gp is increased as an annual sub to gp is the same price as the individual title itself. I'm sure ms has probably already pivoted to this thinking and is making the moves to get it in place.
GP on every device is the end game and the benefit is mutual so I'm sure there's a deal with the big players down the line. If I'm not mistaken, the xbox cloud app already ships on samsung tvs in the us so its bound to progress with broadband penetration globally.. ms just needs to put their azure servers to good use and it could work with a shift in balance geographically with office priority during work hours and xbox outside of those times.
Not sure what you mean that they don’t break even. It’s a slow start business model but Netflix is certainly deep in the green and so is Apple TV+ as the newest player on the block.
Pretty sure the rest are as well. The model is just fine in the TV space it’s just being saturated with choices which fortunately isn’t the case for games.
Game Pass also isn’t a streaming service, I mean a part of it is but that’s a drop in the ocean at present.
Difference is that Game Pass isn’t ONLY subscription and there is a purchase conversion that happens on the very same platform which is often left out of the metrics.
It doesn’t need perpetual growth but rather just a baseline install base to keep it in the green which I believe they have.
Of course one could offset the ActiBlizz acquisition directly and say well that’s not profitable but it’s not accounting for the projection into the future.
Thing with the subscription model is the fairly consistent revenue stream that it brings to the party whereas the direct sales model ebbs and flows based on release windows etc.
Of course between revenues the Americans love to quote as if they are profits and not disclosing profits it’s always hard to know exactly how much profit it’s making but my understanding was they are making around three times what they are spending on it, acquisitions and such excluded.
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I think that’s purely contractual obligations talking there.
Like I said above I think there are some existing contractual issues there making it tricky in the right here and now.
Game Pass has been stated to be profitable in a stand alone direct influence capacity but it’s bundled into the whole Xbox brand and that as a whole is struggling.
So this move would be an “unbundling” of sorts.
That being said all of this is very deeply rumour mill in origin and I wouldn’t get too deeply taken by any of it.
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KenMasters
Super Moderator
Streaming services generally are not profitable, I believe Netflix is the only one that has managed to turn a profit in recent years. Music streaming services, I don't know what they're going to do, but they are really struggling to make it work. On the video streaming side they're looking to do things like advertising tiers, windowing content on higher paid tiers, making it harder to cancel subs - big changes are coming.
Spotify Is Screwed
Spotify is the world’s biggest music streamer but rarely turns a profit and just cut 17 percent of its workforce. Its business model looks increasingly precarious.
Driven to tiers: Streaming video services look to up their profitability game with viewers
In 2024, streamers are expected to charge more for premium content, fight churn with longer subscriptions, and satisfy bargain hunters with more pricing tiers.
www2.deloitte.com
How much money have streaming services lost?
Broadcasters are losing billions as they invest in the future of TV. Our analysis shows that real losses are likely to be even larger than the companies have reported thus far.
the-media-leader.com
Apple will lose billions of dollars on its streaming TV services for years to come, making a material dent in the company’s earnings performance, Barclays says.
I think it's fair to separate digital sales from the subscription service.
I find that hard to believe, you'd think they'd share the numbers if that were the case. They had a plan, same as a lot of subscription service plans, but I don't think it's working out:
Why Has Microsoft Put Xbox Game Pass Subscription Numbers In A Black Box?
Microsoft has decided to quietly stop reporting numbers for its new driver of growth, Xbox Game Pass. Microsoft was very happy to report about huge surges in Game Pass subscriptions during the pandemic.
www.forbes.com
It's a general trend and much discussed recently - will be interesting to see how things move on. Personally hoping for some consolidation, tired of all these new services popping up, it's cable all over again. I think I read somewhere recently that Paramount and HBO were considering merging streaming services.
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OP
AdrianH
Administrator
Yeah, as of today, Amazon Prime Video costs me an additional £3 per month to just not have ads.
What do you mean by "windowing content"?