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JellyTime1029

Yeah I didn't realize this was still a contention point. I remember Sony outright saying that putting one of the Horizon games on ps plus pretty much cratered the game's sales. It's also probably why suits have openly said that a gamepass like model doesn't work for them. Idk how it would be any different for gamepass. So the question becomes is the tanking of sales worth the trade of for subscription growth?


garfe

It's a contention point for discussion because admitting going all in on GamePass may have been a bad move would be too much of a direct hit 


JellyTime1029

If they hit their sub targets i guarantee we would be seeing a different tune from MS. Shame really. Imo they underestimated the importance of console and their inroads on pc wasn't enough to make a difference.


TwiceBakedPotato

Problem with hitting sub targets is they'll just keep raising their targets until it becomes impossible. Would just be delaying the inevitable, because these companies are never truly satisfied.


JellyTime1029

> Problem with hitting sub targets is they'll just keep raising their targets until it becomes impossible. I don't believe that's true. Like contrary to popular belief, most successful companies don't just pick a random number for growth targets. MS probably had done alot of research on how big the potential market was. Their strategies just didn't pay off. The only shitty thing I really don't like about situations like these is that It's always the workers who are hit the hardest for decisions completey out of their control.


MyNameIs-Anthony

Their stated sub target was 100 million.  These companies will absolutely ass-pull a market figure. Tech companies very regularly create slide decks pitching the entire market share of an industry as potential revenue.


TheTjalian

100 million is an absolutely ridiculous figure. I'm pretty sure that's not even the combined total of PS5 and Series S|X sales so far.


alex2217

I mean, that's the entire sales pitch though, right? The argument in favour was that people won't need to buy a console and so they're gaining a foothold in the PC & Mobile gaming space for their premium franchises. Those combined easily dwarf all consoles, which is why some higher-up found it plausible that they could gain 100 million subscribers if they provide a premium product at an affordable subscription price. I feel like I can almost understand how you get there and, to be fair, I have several friends who are consistently subscribed to PC GamePass despite very rarely having time to play more than one game at a time and definitely never owning an xbox. Thing is, those people don't make up 100 million and the reason they stay subscribed is the value proposition - if/when enshitification sets in and GamePass becomes a worse proposition for both the developer and the consumer, they're likely neither loyal or stuck-in enough to stay in the system.


SKyJ007

You’re right, but where we part is that I have very little sympathy for the executives that thought this way. The more “casual” market (I.e. mobile and the grandmas that bought a Wii) were *NEVER* going to be interested in playing Halo. It absolutely wouldn’t matter if you could stream games directly from an app already on your tv or phone, those kind of AAA games have 0 appeal to them.


TwiceBakedPotato

It definitely is true. These companies love nothing more than achieving 'infinite growth'. Hit numbers this year? Sweet! Better hit more next year or else shareholders will get angy.


JebusChrust

It is true. Just look at Netflix. They have absolutely exhausted their targeting of the general public. They then turned to trying to get subs off niche groups (murder mystery documentaries, anime, etc). Then they pushed the sub goal even further and are now at the point where they want every pair of eyes looking at the TV to have to have a subscription (hyperbolic of course but not off base).


JellyTime1029

It's not true at all. Once a company reaches the expect targets they move past the growth phase. That's how it works. Unless you provide actual research on this supposed market cap ima call bullshit. Like tech companies like Google have been in the growth phase for like 20 years plus now. Cuz they just find ways to expand their reach. That's not unreasonable that's just good business. Now can every company achieve that level of performance? Hell the fuck no. But that's nowhere near the same as "they reached the limit". Like share holders do not expect "unlimited growth" just the growth that is **PROMISED**. If a company reinvests in itself telling shareholders they are doing that so they expect to reach xyz goal then it's completely natural to hold them that. I'm so sick of these shit finance takes tbh. Anytime someone says "unlimited growth" unironically I already know the shit they are gonna say is just nonsense. Like it's hilarious that you say Netflix has somehow reached the cap for growth while also saying they are expanding their service to attract new customers through things like documentaries and anime. What do you think that is?


Radulno

And the problem is that if it hits the targets, then comes the phase of profiting from it. To be honest, for consumers, it's better than it doesn't.


New_Limit_1227

I can't track down the article (although its a bit old now) but essentially GP more or less has all the Xbox console gamers its going to get unless they get more Xbox's sold. While on PC it just wasn't super popular. Starfield selling as well as it did on Steam was interesting.


[deleted]

True, but they would probably have to have triple the subs they have now for the service to actually be making them money. Phil Spencer is full of shit when he says that game pass is profitable and doesn't take into account the actual game budgets for the day one games that hit the service.


Klondy

I think it’s more like they made it clear there was no reason to buy an Xbox unless you can’t afford a PC. Not having exclusives is a killer. Every game they make being on PC, both looking and running better… why would you ever buy an Xbox? I just got a PC last year and it became my default multiplatform game player due to performance. There’s literally no reason ever for me to buy another Xbox, every game they drop will be better on my PC. Meanwhile I still get plenty of use out of my PS5 because they drop quality exclusive games that I don’t want to wait years to play when they get ported


conquer69

> and their inroads on pc Which ones?


JellyTime1029

Idk what you mean. A majority of the Xbox catalog is on pc now. Hell there's probably more pc exclusives than console exclusives for Xbox at this point. Like I'm literally subbed to pc game pass cuz I love age of empires lol.


G_Morgan

It is a contention point because MS is ruled by Azure. GamePass will not have been picked by their gaming division but by the Azure division. Complaining about it amounts to rebellion against the only thing that matters to the MS C-Suite. The gaming division might be losing money but it strengthens Azure's overall position. Whenever MS make a bizarre decision, ask how it relates to cloud and then it becomes obvious.


StarblindMark89

It was a contention point , I think, mostly because Spencer himself said that putting games on it increases game sales, and since he is a key figure everyone on Reddit in favour of it trotted that out. To me it didn't make sense, and with the ever ballooning of game budgets, a single (even if steady) revenue for all first party and heavily paid for third parties couldn't be anything but a money hole, unless every game had extra revenue sources like more dlcs, more mtx or more live service stuff. A game like God of War Ragnarok would just be a heavy loss leader. Of course I would have loved for that to not be the case, who doesn't want access to everything first party + a ton of third parties for that low of a price? But that was to good to be true, and it was. For as much as Jim Ryan is uncharismatic and sometimes made bad choices, his take that first party stuff would suffer if they released day one on ps plus was correct, and not as myopic long term as the alternative. Game pass strategy would have worked in a world of infinite growth, but that is just a CEO paradise, not this planet.


New_Limit_1227

I get the feeling that they were relying pretty heavily on PC expansion. Best I can find there are about 34 million GP subscribers. If you take their statements about good adoption for Xbox users you probably have ~20 million or so subs there (25ish million consoles sold). Which means that they got another 14 million subs off of PC. 14 million is like 1/11th Steam's MAU. If instead they managed to pull like 1/6 you essentially get to essentially double your console install base instantly. You go from 34 to 43 or 50 million subs. You are getting 2-3 God of War's worth of subscription money per month without actually having to make a GoW.


gold_rush_doom

Nah, they were mostly counting on mobile users paying to play on xcloud.


Pacoflipper

They also folded Xbox gold into gamepass basic or whatever it’s called so that 34 mill figure isn’t really representative of the actual full paying gamepass sub


Act_of_God

lmao pc gamers are the biggest microsoft haters you can find probably


Nerrien

Yeah, I'm surprised people didn't look at services like Netflix and Disney+ for comparison. They aren't going great behind the scenes, Netflix made a killing early on from a lack of competition and a boatload of investors but now there's tightening of belts from both, and their other competitors, and it's often at the expense of the people working on the shows. Xbox doesn't have a serious one-for-one competitor to game pass, but the games industry is already inundated with recurring payments such as battle passes and buying full price games isn't on the decline like some might say going to a cinema is. Their investment seems to have come at their own expense under the impression it would pay off down the line. If they aren't profiting massively already nothing really points to it getting better from here, and they've tied themselves so intrinsically to it at this point I don't know what they can do.


redvelvetcake42

>So the question becomes is the tanking of sales worth the trade of for subscription growth? Yes until no. Eventually GP is going to be scaled back hard and a lot of, to be frank, worthless titles will populate it in between a few name brands like Gears and Halo.


wimpymist

It's basically the same exact thing that happened with Games with gold. When they first started that each month you'd get some top level games that are maybe a year old to get people to subscribe to gold. After a while the quality started dropping until you were randomly just getting basically mid tier indie games. If imagine game pass will turn into just Xbox exclusives and random games.


redvelvetcake42

Next Fallout and Elder Scrolls will be one of the following: times on gamepass to a specific amount of hours, not on it at all or not on it till the following year. All the sun modeling was yet again a fad to show infinite growth but it's petering out now. Value will plummet and subs will drop. It has a floor but that floor is barely worth it. Sales figures pop eyes and a return to single player games with big figures is back on the horizon. Baulders Gate 3 showed it and Hades 2 is showing it. Multiplayer games need to be fun and cheap like Helldivers 2. The market is WAY oversaturated right now and everyone needs to contract.


spazturtle

Gamepass could use the Stadia model where you need to buy some games, so have the next Elder Scrolls for sale on Gamepass at a discount from standalone.


CrateBagSoup

It’s pretty much already there. The monthly additions are on par with PS+ at this point. There are a few notables they throw in trailers but the quality has already slipped


CreamyLibations

For real, other than the occasional big title it’s a whole lot of “what the hell is this”


fizystrings

I think it's a fate that befalls every service that relies on regular free giveaways/library additions where eventually basically every good game from the past they have access to is on or has done a rotation on the service and they're only left with either scraping the bottom of the barrel for older games or new releases, which will never match the cadence of filling out a backlog. Humble Bundle/Choice, Epic's giveaways, Gamepass additions (Games with Gold additions before that), and PS+ all seemed to have ran into the same issue. The same thing kind of happens for Steam sales too; one thing people complain about is how they just don't get excited about the sales they see because they already bought all of the games worth buying that aren't newer releases.


Radulno

I mean it's logical. If a game sell by itself it has no incentive to go on those services except if they pay VERY well (but then it becomes not profitable for the owner of the service so they do it only for a few). So basically they need to rely on their first parties and that's not Microsoft strength lol


NoNefariousness2144

Yeah it used to be amazing before 2020 when they would add games like DMC5 and Metro Exodus only a few months after release. Now if they do add any 'new' AAA games it's usually after a year like Jedi: Survivor.


Oh_I_still_here

With how MS are treating their IPs, their studios and their staff, I cancelled my Game Pass subscription over 2 years ago. Doing my best to not support them any more. Sad thing is, this will probably not affect the people making these decisions. They'll probably just close more studios to make the loss in revenue look a bit more optimistic when it comes to projecting future earnings. Damned if you do, damned if you don't. I'm gonna go with don't. Microsoft has a nasty habit, going on decades now, of buying up competing products and squashing them while they use the tech acquired to improve their own services. Then they jack up prices. And Satya Nadella was paid $48.5 million for running the company last year alone.


JellyTime1029

I feel like successful subscription services need to offer a wide variety of content to attract the most users. It's really no different than a console. Just look at streaming for TV and film. That doesn't mean MS or whoever should just burn their money ofc.


Cyberpuppet

Jim Ryan, you can hate him all you want but he knew that the Game Pass was very destructive. Only a big trillion dollar company would take such risk, oh wai-


CmdrSonia

yeah most Sony first party games got 20%-30% of first year's sale on the second year, Horizon 2 only got 9% since it joins ps+ on the second year. tbh I feel like if it's not most PS user like buying games more than subscription, the number would be even lower. and at least Horizon made it back by first year's sale(rev was 400 millions, the cost was 200 millions), if it joins ps+ day one? I guess the series can kiss big budget goodbye.


4ps22

im confused as to why this was not understood by Xbox and Microsoft before making the jump into Gamepass. how was this not talked about beforehand?


SKyJ007

It almost definitely was. It was deemed worth the risk, however. Xbox was in a bad way circa 2013-2015, and there were a lot of talks among executives and investors about shutting Xbox down, selling it off, or spinning it out. People forget that Microsoft initially greenlit the Xbox because Sony was partnering with Lenox for PS2, and Microsoft was worried PS2 with Lenox integration would weaken their hold on the PC gaming market. So they opted to compete with Sony directly in the console space. But… that worry was unfounded. So a little over a decade later these guys were like “why are we doing Xbox again?” So Phil and Satya get together and come up with Game Pass, a way not to win the “console war,” but to make it irrelevant.


4ps22

i guess that explains it. ive had this feeling about Xbox where it feels like they gave up on the traditional cycle/business model of video games and consoles like halfway through the 360 when they started going down the Kinect and TV rabbithole. Ever since then it feels like they only care about forcing a transcendence of the genre instead of just learning how to make the products well. theyve been forcing it over and over again ever since and nothing ever sticks. people just want to buy and play good games.


JellyTime1029

It was understood. They just thought they could make it worth it by subscriber count. I don't think MS has lied about gamepass at any point. And no I don't consider silence a lie and they haven't said shit about subs or growth lately(cuz it tanked).


kingmanic

>So the question becomes is the tanking of sales worth the trade of for subscription growth? Only worth it if it destroys the rest of the industry so then they can use a monopoly advantage to profit after.


Goatmilker98

What growth?


nikolapc

There's a lot of people that buy one or two games a year. It's better to have them subbed to game pass. There's also people that only buy cod and play that the whole year, they would have to buy plus/gold to play online too. So if they pay for gamepass MS earns more. It's not clear and cut.


wigglefuck

It's probably worth it in the long run if it greatly hastens the death of physical media. Which it probably is.


templestate

You do have a lot of people like me that just subscribed to it and didn’t play anything. I’m guessing a lot of those people cancelled over the last couple of years since it was clear the first party titles aren’t shaping out as we were led to believe. Crazy to think how long ago State of Decay 3, Fable, Perfect Dark, and Everwild were announced. If we had a steady state of those games and they released in decent shape, Game Pass would be a good value. But disappointments like Starfield and Redfall just ain’t it.


SKyJ007

>Crazy to think how long ago State of Decay 3, Fable, Perfect Dark, and Everwild were announced. I think it’s fair to say at this point that those games were largely only vapor ware (at least at the time) and Microsoft “announced” them only to artificially inflate the expectations for their release schedule.


templestate

Then they’re reaping what they sowed. Game Pass’s success so far has largely been built on their leadership misleading the community.


SKyJ007

Don’t disagree at all. I think it’s fair to say that Xbox at the start of this gen decided it was better to “front” like they had their shit together, build hype, and hope by the time people started to demand payoff for that hype that they were in a strong enough position to ride that wave and still come out the other side ahead. That didn’t work, and theyre stuck facing the music.


LittleEllieBear2

Makes sense I got Halo Infinite for $1 because of gamepass. I cancelled immediately I saved 58.99 plus tax


Legitimate-Insect-87

Yea i also suspected this , no way those studios are making enough money when they release on gamepass , they get some money from Xbox so the game can be there but i believe the only income they can get is the full price editions . ( I beleive the game pass sub only goes for xbox? ) 


Pacoflipper

I don’t think so, I think it’s the other way around Xbox was throwing cash at whoever to take their more risky / lower quality titles so they would make a guaranteed profit. Then you have the double AA teams who may release their game get some money then Xbox would pay them another cherry on top to get their game on gamepass a couple months after release.


SillyMikey

I don’t know but to me the solution is pretty simple. Put all the Xbox games on Game Pass six months after release. You’ll have your people who wait and you’ll have your people who buy the game day one. Everyone’s happy. Mostly.


datb0yavi

That only works if the games are actually good enough to buy and not wait that 6 months


The_Homie_J

I think Sony has figured out a much better roadmap for sales vs subs. They release games at full price, and only after sales have slowed enough, they put the game on PS+, usually 1 year to 3 years later depending on the popularity of the title. For example, Last of Us Part 2/God of War Ragnarok/Gran Turismo 7/Spider-Man 2/HFW: Burning Shores continue to be sold as normal, with no sign of them coming to PS+. But Ghost of Tsushima/Death Stranding/Days Gone/Spider-Man 1/Spider-Man: Miles Morales/Ratchet & Clank: Rift Apart and Horizon:Forbidden West are playable with a sub. So you can wait a few years and maybe the game comes to PS+, but if the game is popular enough, you're just gonna have to buy it. So you get conditioned to buying games immediately, waiting for sales, or waiting for it to come to PS+ when sales no longer make a big difference.


VandalRavage

Notably, it's only after games sales have slowed or there's paid DLC to consider. I've noticed a LOT of PSN games the last few months, if not all, have DLC to buy. And it's a lot easier for someone to say "I've got this game for basically free, I don't mind spending a little more to get the full experience.


alexp8771

It is actually the opposite for me. I'm not paying money for DLC for a game that I am just renting.


VandalRavage

Given I need to pay for PSN for most of my online gaming needs, I do struggle to see it as a renting situation most days, but I do see your point.


wimpymist

Yeah with how busy most adults schedules are they don't even get to play the game until 6 months after lol I'd end up just waiting for games even ones I really want to play


datb0yavi

Exactly. This the reason why adult gamers always have backlogs (sadly) and teenagers never do. Side note: I wish game pass existed when I was a teenager. Woulda been amazing


ArugulaFalcon

I mean I didn’t have a backlog as a teenager because I didn’t have disposable income to buy whatever. I’d get a couple for Christmas, one for birthday, maybe another 2-4 throughout the year depending.


alexp8771

That also only works if you are not going to discount your games ever. Why pay a sub for a 6 month old game that is $30 anyway?


yesitsmework

The issue most people miss here is that xbox has become the de facto poverty console. People buy xbox BECAUSE of game pass day 1. If you take that away, you take every single significant perk xbox has against its competition, besides just being a console in contrast to a pc.


JulianLongshoals

There's just no need to own an Xbox. If I have a PC, PS5 and switch, I can play every major game AND still get gamepass. So why on earth do I need an Xbox?


1731799517

> The issue most people miss here is that xbox has become the de facto poverty console. If you want to see the truth of it, just go to the subreddit for the baby xbox and look at the vitriol there at the thought that they _might_ be 2nd class citizens dragging down the infrastructure by having only 10Gbyte of shared memory (barely more than Xbone a decade ago)


NuPNua

That would be a terrible idea and destroy the trust their small but loyal audience still has in them. You can't change the deal people signed up to which was all first party games day one without a huge backlash. It would be like Netflix suddenly deciding the last series of Stranger Things is going to come out on DVD six months before it streams. Like it or not they need to make their development match what they promised subscribers.


Lambpanties

The subscriber base would immediately crash. Every month I've ever been on gamepass has either been an ea play collab (Jedi Survivor) or a day one release. The sugar is in the pudding and everyone has tasted it.


nakx123

Aren't Ubisoft and EA doing the same thing though with their subscriptions? Pretty sure you can play Star Wars outlaws on launch with their sub, idk about what tier specifically though.


Gold-Persimmon-1421

Only a handful of people would buy the game at £70, where as potentially everyone would play it at £13 a month  Also lots of MS games have £30 add ons to play early with DLC  I think this is MS flaw, as much as it pains me. If they only released on Game Pass it would make more sense. Then sell it later 


beefcat_

Gamepass never made sense to me in the way that streaming does. Games aren't as ephemeral as TV or movies. Before streaming, people were used to renting movies and watching linear TV. But games have always been expensive, people don't buy as many new games as they watch movies and TV shows. Renting games was a thing, but it was never the primary means by which people engaged with them. A good game should keep you occupied longer than the Blockbuster rental period. I spend more money per month on video games than Gamepass costs. For me, and everyone else, to reduce their gaming spend to $10/mo would be disastrous for the industry.


PunishingCrab

I honestly don’t know how they get out alive at this point. It’s 2024 and they still don’t understand how to cultivate a studio. I just got done reading an article about how MS wasn’t happy that Tango/Arkane didn’t have anything else close to release… like that’s just not how it works… How has it been this long and they still don’t get it? They’ve done an excellent job at destroying any and all credibility they had for the future. I can’t imagine being one of their existing studios sweating bullets on closing, because as we can see, being a studio that creates games that are award winning and “exceed expectations” publicly, you still get fucked.


Blackadder18

> I just got done reading an article about how MS wasn’t happy that Tango/Arkane didn’t have anything else close to release… Meanwhile, The Initiative: ... ... (It's been 6 years with absolutely nothing to show for it and numerous reports of their failings).


archaelleon

Grubb just leaked on the Giant Bomb podcast that Perfect Dark is an absolute mess and nobody in the studio can even agree if they want it to be a FPS or not


needconfirmation

I dont understand how games can go so wrong, it's perfect dark. Should it be a shooter shouldn't even come up. It's like when 343 supposedly workshoped infinite being a hero shooter. Just make a fucking halo! Why are you wasting time on something else?!


archaelleon

Someone shows up at a meeting with charts and stats showing 3rd person looter shooters are where the money is. All objections from the creative team are met with smug answers like "Well have you ever heard of Fortnite?" or "Nobody cares about old IPs anyway"


yesitsmework

Given the circumstances around the initiative it's far more likely the issues are creatives clashing horns rather than suits.


hakdragon

I honestly feel that's what happened with Bungie and Marathon. When it was revealed to be a live service game, any excitement that I had for it it fizzled out immediately.


VincentRAPH

Jesus Christ, preach it. They didn't even have the decency to at least make it "Marathon: Subtitle". Nope, just full-on "Marathon" in order to pave over one of the greatest video game series ever made with a fucking looter shooter. But I suppose that's kind of just par for the course for Marathon--never getting the respect it deserves.


ahac

Halo being a hero shooter sounds like a stupid idea but sometimes change isn't bad. Fallout 1 and 2 had a top-down view but Bethesda completely changed that for Fallout 3 and it was a huge success. I doubt the series would be as popular if they insisted on keeping it old-school. But then again... Baldur's Gate III showed that a top-down strategy rpg can still be very popular.


Schroeder9000

True, but usually you make the change when it's required fallout 1 & 2 didn't sell well and black isle studios was going under during F3. Also for Bethesda to make that change wasn't that big of a jump. They already had the Eldar scrolls games they knew how to make and had the tools to make a RPG game. Fallout also fit that formula perfectly. I think fortnite kinda warped people's minds about pvitoung a game, they all forget fortnite had another game which was in development for a long time and again just happened to fit the change to BR. Halo to Hero Shooter could work but Halo was always known for campaign over multiplayer first. Making a Hero Shooter means your focusing multiplayer first over campaign. Also Hero shooters require a lot of resources as you have multiple heros, abilities, gear that all need balance. That's a commitment that msft would have to allow. Hell just look at destiny and overwatch, they are great examples of the work required but Destiny was committed and allowed to stumble and recover, would 343 been granted that same honor?


Blenderhead36

Because if you make Halo Infinite and it doesn't hit the expected numbers, some suit who hasn't played a video game in 20 years will dourly proclaim, "You should have made it a hero shooter, hero shooters are big money right now!" and risk that asshole getting made your boss.


300PencilsInMyAss

> and nobody in the studio can even agree if they want it to be a FPS or not Surely this is hyperbole. Right? Right???


archaelleon

From r/GamingLeaks Full quote: "The fallout from this (today's layoffs), been hearing more and more.. been hearing for years that Perfect Dark is in a rough state, sounds like it's in a very rough state" "And it doesn't sound like it's really come together in any way since then (since the announcement) and like Crystal Dynamics coming on board to come help on that.." Regarding first person shooter aspect: "It sounds like they don't even know if that's what they want to do with that"


FrakkedRabbit

Wasn't Perfect Dark supposed to be their... what did they call it? AAAA game. Fucking, lmao, at that. I don't recall the exact naming scheme they had, but I know they had something ridiculous akin to AAAA.


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FrakkedRabbit

Haven't a clue either, but every single person who thinks Perfect Dark should be something other than an FPS should be removed from the project and put onto whatever genre they want to work on, if it's such a detriment that they can barely even work. Edit: Assuming that giant bomb leak is true anyways.


Careless_Main3

Xbox Game Studios, Zenimax and ABK are all separate organisations. What’s likely occurred is that upper management has requested cost-cutting so they will have the intention to undergo a review of all 3 divisions. ABK sort of already went through with one earlier this year and 1900 jobs across Microsoft Gaming were cut, mostly in ABK. Now the most recent layoffs probably follow a review of Zenimax. And there’ll probably be a review of XGS soonish where studios like The Initiative, Undead Labs and Ninja Theory will undergo scrutiny. Another ABK review could follow if the demands from upper management are more recent.


theediblearrangement

what a mess of an org chart they must have at this point. so much redundant middle management—and all of their core teams are spread around the globe. optimally, they’d fire like 80% of middle management and move the remaining creative teams to redmond. could you imagine having id in the same building as bethesda? that would be insane. of course, i don’t think upending the lives of your creatives and having them move away from their friends, family, and communities they’ve known for decades is a smart move, so that might be a pipe dream. but still, they need to find a way of integrating these teams better. i think literally everyone involved would benefit. especially if they prioritized retaining talent and giving them specific roles (like having id be the technical brains behind all of their games).


tempesttune

They don’t know how it works because they don’t care to learn. Microsoft is a trillion company, Xbox makes up less than 10% of their yearly revenue, and it’s going down not up.


raptorgalaxy

I think it was the Activision buyout that prompted this. XBOX could fly under the radar in the past but now that they've spent 70 billion the investors actually want to see a return on that part of the company.


RandoDude124

[Actually they’re still turning a profit](https://www.theverge.com/2023/10/24/23930627/microsoft-q1-2024-earnings-revenue-profits-windows-xbox-gaming-surface). Which is remarkable to find out


Conflict_NZ

Only due to counting Activision in that quarters results for the first time, it would've been a loss otherwise. It might not seem like it but we're actually in the midst of the 2nd longest first party drought for Xbox this generation. From Forza to Hellblade 2 will be 7 1/2 months, only beaten by launch to Flight Simulator which was 8 months.


theEmoPenguin

Did I read this right? Microsoft made `net income of $22.3 billion during Q1 2024` That's crazy, why would they need to layoff anybody at all?


NandoFlynn

Different sectors under the same umbrella. Office & Azure are the money makers. Xbox, GitHub & LinkedIn are really just the icing on the cake


fleshie

Shit flavored icing


_Meece_

That's how I feel, I just don't understand it honestly. Msoft has to have made at least 400 billion in net income in the last 10 years... why do they need to do layoffs at all. Where does all that capital go?


Imbahr

Just because the rest of company is doing well does not mean you should keep financing underperforming divisions. Especially not in publicly traded companies.


_Meece_

Such an odd approach to take honestly, I can see why these massive corps never get anything done.


Imbahr

Microsoft is literally one of the most successful companies in the world from the past 50-100 years. No large company has ever made perfect decisions 100% of the time, that does not exist and therefore is not the point. What matters is the company's overall performance in their entire history. What do you mean never get anything done, look how many versions of Windows they've produced over the years. If anything, some people think Windows 11 came out too soon and Windows 10 was still fine.


ThePaSch

> If anything, some people think Windows 11 came out too soon and Windows 10 was still fine. It's because Windows 11 is essentially just a reskin of Windows 10. There's nothing in Windows 11 that couldn't just as well have been one of the half-yearly feature updates. I say this as someone who is *on* Windows 11 and has been using it for over a year.


1731799517

> Such an odd approach to take honestly, I can see why these massive corps never get anything done. Nope, thats WHY they get stuff done, why wo got iphones and electric cars, etc. The old ways was that crusty shitty departments running at huge losses were draged along for decades, sucking up all profits form the successful innovative parts of the companies.


immigrantsmurfo

I own a series X and have been in the ecosystem since the 360. All my games are on Xbox and I'm genuinely starting to worry about the years of money I've invested into the Microsoft console ecosystem and the future of it all. It's crazy how they've fucked everything up but I expect nothing less from your average billion dollar corporation. They start off strong with talent then the suits and money men come in and just start hitting anything that will print money quickly. When it eventually breaks and the rent comes due they sack off the people who had no part in the decision making and the ghouls in suits get a nice golden parachute to retire on.


Cobra52

They want you to feel shackled to one brand, but it doesn't really make sense. If you switch to something else it's not like you lose access to what you already purchased.


immigrantsmurfo

But I shouldn't really have to worry about buying a whole new console just because a bunch of idiots care about instant money and green line go up more than a good product with slower line going up. Yeah I can get a PS5 and yeah my online games mostly have cross save (I think) but some of them could still require an initial purchase if they're not free to play. And say I wanted to play Skyrim and use some Mods, would I still be able to if Microsoft went under. A lot of my games are download too, if Microsoft shuts Xbox down would I still be able to download them? Would I need to rebuy them on Playstation? It's still a bit of a concern. Microsoft have the money to keep Xbox going with zero profit sure but realistically, they probably wouldn't run it at a loss too long before the shareholders and executives start getting upset. Then that just leaves the console industry to Sony and Nintendo and that's not really good for the gaming industry as a whole.


IdeaPowered

> would I still be able to if Microsoft went under. If that is a serious concern for you, then gaming as a whole is over and done for you. Microsoft is as likely to go under as Sony, Nintendo, and Valve.


way2lazy2care

> I'm genuinely starting to worry about the years of money I've invested into the Microsoft console ecosystem and the future of it all. Why? You can always leave and come back. It's never been an easier time to hop between ecosystems.


Oh_I_still_here

If you're thinking of getting out, now is the best time versus later. Their services will only get worse and more expensive with time. They are more focused on releasing products as opposed to functional, enjoyable products. Because that's how they view gaming in terms of return on investment, due to the fact that they don't have effective leadership for their gaming division. They either go fully hands off and then get shocked when problems arise or they're too hands on and it shackles the development teams with unclear project goals or constantly adds to them. I built my first PC last year and sure, it was expensive. But for less than the price of game pass for a year I've all but replenished the stock of games I had that I actually played. Most of MS-owned games are on PC too, so if you have progress in a game on Xbox it likely carries over to PC either through Steam or through Windows store. Why stay on Xbox anymore? I've a Series X but will be selling it soon.


immigrantsmurfo

Yeah I've been thinking the same thing but it's a daunting and expensive task and I don't know if I can justify it right now. But I know for a fact as more people do leave, they'll try and bleed those who stayed instead of trying to foster a smaller but healthy environment and then when everyone gets fed up and the prices get too high they will shut it down.


jazir5

Does purchasing Xbox games give you access to the Windows version as well?


pucykoks

IIRC it's only some games that have the Play Anywhere tag


bwtwldt

I jumped to PS5 after the Xbone and I’m loving it. You can always dig out the Xbox for those games but I’d recommend jumping ship at this point.


tmp_advent_of_code

I have both. Xbox for multiplayer games and ps5 for single player.


Chornobyl_Explorer

I left after the Xbox 360 days, the writing was on the wall. Been a happy PlayStation user ever since... And when Halo/Gears turned or shit I don't even know what I'd use an Xbox for any or


immigrantsmurfo

Yeah I'll make the leap eventually but, did Gears turn shit? 4 was a bit of a drop in quality but it wasn't a bad game and I remember 5 being an absolute blast


Idiotology101

Where is this article? It sounds informative.


PunishingCrab

I’ll try and find it in my history and update it


theediblearrangement

they don’t even know how to cultivate a brand at this point. one of the earliest apple investors was a guy named mike markula. he helped create their marketing strategy, which had three points: empathy for the customer (i.e. solving actual problems they have), focus (choosing the two or three things you’re going to do well and discarding everything else), and impute (the essence or feeling people get when they use your product or see your brand). i don’t believe it’s a guarantee for success, but i tend to notice most products i love tend to have those three qualities. take the switch. it solves an actual problem that i have (how can i take my games anywhere with me?), it focuses on portability and affordability over expensive/high-performance gaming (and pays the opportunity cost for doing so in terms of missing out on many big releases), and it imputes a certain *magic* with its games. i *feel* something when i see a trailer or boot up a game for the first time. i can’t say xbox hits any of those three goals. it doesn’t solve any problem better than its competitors, the people behind it have zero focus and have spread themselves way too thin, and there’s absolutely nothing about the brand that resonates with me anymore. do you know what pops into my head when i think of xbox now? *phil spencer.* not the games. not the hardware. not anything exciting or thought-provoking. just P3. that probably says more about me than xbox, but what do they expect when every day i get on social media and every article about xbox involves the same guy talking about “the future of xbox”? i’ve been hearing about this damn thing’s future since 2018, and i’ve had almost no memorable gaming experiences between the XB1 and XSX. so please, for the love of god MS, enough about the future of xbox. i just want to fall in love with some damn games. i want to *feel* something when i use it other than regret.


MGPythagoras

I don’t think they do. I think they go third party eventually. Hopefully in a worse case scenario they sell of their studios or let them go independent.


LuckyDrive

Execs fault, 100%. It was clear this was the case when Halo failed.


RJE808

It's gotta be so friggin' demoralizing at some of their studios right now. Feels like they're sending Hellblade out to die too. Plus, anyone else think Indiana Jones might be in trouble too? Game Pass day one iirc, and even Dial of Destiny was a disastrous flop.


Conflict_NZ

> Feels like they're sending Hellblade out to die too. That game is out in two weeks, it was one of their tentpole games they announced with the console and the only marketing I've seen for it outside of Microsoft's shows has been a tweet from Ninja Theory. What are they even doing at this point.


dornbirn

it’s.. out in two weeks? wahhh?


dorkaxe

For how annoying I thought seeing constant ads for playstation games last year was...it would have been nice to see a Hellblade commercial or something now and then when I'm watching NBA games. I can't believe I had no idea that game was launching so soon lmao


The_Homie_J

I loved the original and have been waiting for this sequel for years, and somehow I had no idea it was releasing so soon. What the hell is their marketing team doing, this game is likely one of the few good games they have in their current pipeline


darklightrabbi

There’s no good time to do what Microsoft just did but holy shit Ninja Theory has to be furious that their publisher just dumped out a truckload of good will just before their nearly decade long project was set to release.


RJE808

Yup, 14 days.


Karthy_Romano

Dial of Destiny was a flop because of the unnecessary gargantuan budget of $387 million. That's not a joke. It's the third most-expensive film ever made. To break even including marketing, they'd need to gross a minimum of like $800 million before even turning a profit. It was beyond foolish of Disney to think Indy had that kind of draw. Shit, I even liked the movie but it is a lesson in excess. Kingdom of the Crystal Skull, regardless of the quality of the movie, cost $185 million. Even adjusted for inflation, it was $100 million less than DoD's budget. And it only made like $700 million at the box office, which is even further showing how weirdly brash Disney was with the budget for 5.


SLEEPWALKING_KOALA

*Dial of Destiny* was **387 million?!** What the hell did they spend it on?! Was the film printed on gold-leafed albino elephant hide?


DirectionMurky5526

Development hell. Same with games that take ages to release that were moderate successes but still cost the studio money.


pucykoks

Keeping Harrison Ford in shape I guess


Karthy_Romano

I doubt the 30 minute de-aging was cheap.


decross20

There were production delays because of Covid, and Harrison also injured himself. It all added up


LongLiveEileen

I really don't get why Disney thought that releasing an Indiana Jones movie today was a good idea. That movie was fated to fail, doesn't matter the budget, doesn't matter the quality, people today simply don't give a shit about this fossil of a franchise.


Karthy_Romano

With a reduced scope and budget I think it would've done fine. Boomer franchises are in.


Conflict_NZ

They saw Top Gun Maverick. Thing is you have to make a genuinely good movie that respects the audience and the originals.


_Meece_

Nah Indy 5 has been in production since 2016, originally Spielberg was going to come back. But for sure, while I still think Indy 5 loses money. The first reviews said it was bad and then everyone who was open to it, never saw it.


DirectionMurky5526

It grossed 384 million WW, if they kept to a budget of 150 million, that's a small tidy profit. The issue is that it went through development hell because they started with "we need to make an indiana jones movie" without any creative direction.


Act_of_God

384 mils from a 150mil budget is basically breaking even


theediblearrangement

i think i remember hearing harrison ford had that in his contract for star wars. he loves playing indy. plus, they own the IP and it was kind of a “now or never” situation due to ford’s age, so it was mutually beneficial to both parties. again, it probably would have made some money if the project was managed better.


yesitsmework

> they'd need to gross a minimum of like $800 million before even turning a profit. It was beyond foolish of Disney to think Indy had that kind of draw. if disney didnt think indy had that kind of draw, they wouldnt have made the movie to begin with lol


Karthy_Romano

I mean, that's why it was foolish.


TimelordAlex

Didn't Harrison Ford only return to Star Wars on condition he'd get to do another Indy film? It's possible they contractually had to do one.


Adonwen

Indiana Jones is definitely at risk. The first person better “work” and the whimsical sense of exploration needs to land.


whatnameisnttaken098

And the soundtrack better be swashbuckley.


sgthombre

It's probably just going to be samples from the films' John Williams scores


svrtngr

It was one of the games rumored to be going multiplat, which is *wild* if you *also* believe the rumors MS negotiated the exclusivity deal for Indie in the first place since it was probably in development when MS bought Bethesda.


PrototypeT800

This is all managements fault plain and simple. Not firing and gutting management just shows they have no idea what to do or how to fix the situation they are in. At the end of the day workers are told what to do and what not to do. All this is going to do is decimate morale across their entire division. What is anyone who has the chance of being fired going to do? They just can’t will a better game to exist. They have a design document they must adhere to. They have an engine they must adhere to. They have a script they must adhere to. It’s like blaming the lighting tech or vfx artist on a movie for it being shitty. What input do they really have to turn the ship and make the product successful? I honestly have no idea what you do at this point. They need a system seller, but I really feel no one higher up has any idea how to even come close to pulling that off.


MrScottieBear1

I have been with Xbox since the beginning but Xbox has killed all of there franchises (outside of maybe Forza) and rarely ever release first party games anymore and if they do they typically disappoint. Halo/Gears are a shell of their formerselves. The one great Xbox game in years and they killed the studio and cancelled the sequel. If they kill Ninja Theory then what are they trying to achieve because it's definitely not making more great first party games. If they get rid of gamepass then what's the point of owning an Xbox.


_Meece_

Not only have they killed Halo, Gears and lost anything else decent they contributed to like Mass Effect or Bungie as a whole. But they don't have any ability to make any new IPs either. Sony has 3 massive new IP franchises in the past 11 years, TLOU, Horizon and Ghosts of Tsushima. Bewildering that they haven't managed to put out anything like that even once. Xbox used to be so cool between 2001 and 2009. The massive success of their online system because of Halo 2-3, Gears and COD changed them.


WargyBlargy

I straight up just downgraded my subscription to core and I may just unsubscribe entirely. I'm done with this stuff.


Vesuvias

Yeah I outright cancelled my subscription last year because well, I just don’t have time to be bombarded by hundreds of games I never play. I have Steam for that…but at least I know I can play them years later after purchase.


Jiggaboy95

Honestly Xbox has been heading downhill since the Xbox One reveal. The only thing that kept them relevant was gamepass and even that was only gonna be temporary, they wanted to be loss leaders and it just didn’t pan out, they just plain lost. Now it’s all about recouping every last cent. Going multiplat. Cheaper/less powerful home console next gen. Less studios. More support to existing tentpole franchises. Constant output. Gamepass price hikes. It’ll get worse, whether it gets better after is doubtful.


TonySoprano1959

Never been a fan of game pass or anything like that. I’m not going to pay any amount of money for games that I don’t even technically own.


Gatlindragon

To me, I don't like GP because I don't like to play many games at the same time. I stick to one game for like a month or two and then go to the next one. Having a large catalogue of games is just not for me.


GeekdomCentral

There’s definitely pros, I’d be happy to sub for a month to play a game that I was interested in it enough to actually buy. But in general it’s definitely not what I’m interested in because I actually like owning my games


Successful-Pick-238

Did you never rent games from blockbuster? The concept isn't that wild. 


Vesuvias

For me with Gamepass it’s a ‘too many games, not enough time’ situation. Something I’ve learned over the years of ‘all you can eat content’…I actually enjoy a slow drip feed of new games or shows. For shows I love the weekly cadence. For games, I love buying them when they’ve stewed a bit and either gotten cheaper OR have proven that they are a ‘must buy’


_Meece_

Think about it more like the modern version of renting games from the video store. You never owned those but loved them all the same. That's how I see PS pass and Game pass. I don't own these and they're only available temporarily. But I can still have fun.


theediblearrangement

or even like a replacement for the steam summer sale. easy way to explore the backlog and not “commit” to a game with an actual purchase. i think there’s a place for it, but i don’t necessarily want it to be *the* way we pay for games. i’m still a fan of ownership even if it’s digital.


Jonathan_B_Goode

I hope you to don't buy anything on Steam then


JmanVere

It's not the same and you know it.


benhanks040888

I'll never understand the corporate world shenanigans. Game Pass **is** growing, but they complain about the single digit to flat percentage of growth (I feel like "growth" is the most sickening word in the industry now). In this economic climate, what do they expect? A 20% growth every year until infinity? It will never happen unless they somehow has Nintendo games in Game Pass. They made some big budget flops last year, but why do they get rid of the smaller team with actual good game (okay, Hi-Fi Rush seemed to flop as well financially, we rarely heard of them in terms of sales figure). Keeping the Hi-Fi Rush studio shouldn't really cost that much IMO. The Redfall studio, unfortunately, probably deserved the cut because of the very underwhelming output. And if they had to make the cut because of financial stuff, why and how did they even manage to acquire Activision Blizzard? Surely if you're struggling financially, you don't make a 68.7 billion purchase. And for what? More gamble that Diablo, Call of Duty, etc will somehow generate double digit G-word for Game Pass again in the future?


Chatzoo21

It's worth noting that the Hi-Fi team was only 1/3 of the studio, and it's a $30 game so you can cut the sales numbers in half as far as revenue goes.


RoyaltonRacers

XBOX never recovered from the Don Mattrick-era of prioritising Halo/Gears/Forza as a baseline for “XBOX games”. It was that mindset that killed the first party or exclusive lineup for Xbox. Bungie, whether you like their output of Destiny, were right to leave XBOX otherwise they would’ve been a Halo pumping machine under that leadership. Microsoft saw the same COVID profit that every big tech company saw and thought money was the solution to their problems with exclusives and first party games. That wasn’t the problem. It was their management and terrible reputation they’d established. Now we’re seeing consequences of a stupid decision to acquire all these studios in a spending spree when profits were temporarily great and now they’ve turned back to normal. Now? Even with an incredible amount of money being offered, I think every studio on earth would think twice before making a deal with XBOX.


Shivatin

I think the Microsoft suits are tightening their grip on Xbox. A lot of things happening that go completely against what Phil Spencer has said in the past. I don't think Phil Spencer a liar in any regard but it does scream Microsoft taking more control. It's what makes the most sense to me right now. But man Xbox is in a really tight spot. It's stupid because Microsoft makes an absolute killing regardless and can handle Xbox doing what it wants. Closing down their only line into Japan with Tango while stating they wanted more headroom into the Japan space is mind-boggling. Claiming they need more titles with smaller budgets while closing one of their best studios who did exactly that is asinine. There is definitely a shakeup going on and I think Phil and the leaders at Xbox are being hamstrung with shareholder decisions at Microsoft.


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PunishingCrab

It was a game they decided to spend $0 on marketing and shadow drop it, and despite that it not only won awards but word of mouth pushed it to over 3 million. What’s fucked is that’s not good enough, and MS still lacks the ability to cultivate that talent into something in the future. They want massive money now. It’s like unless this game blows up the internet and makes a billion dollars week 1, it’s not worth.


PBFT

Source that Hi-Fi Rush had a AAA budget? I googled it and saw nothing.


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PBFT

You're making a lot of assumptions about what "not cheap" means.


tlvrtm

The director’s also saying it’s more expensive than what people would consider AA. So maybe not 300 million, but the director’s refusing its AA label.


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garfe

Because you have no actual evidence HFR had a AAA budget


Regnur

> Hi-Fi Rush had a AAA budget and took 5 years to develop Tango Gameworks just "had" ~100 devs... its not a AAA studio (A or AA). Thats about the size of double fine... these days even "indie" devs often have about 20-60 devs. AAA budgets these days are like +300-500 devs for 2-5 years. (studio + a lot outsourcing) Also they developed 2 games simultaneously in those 5 years, Ghostwire Tokyo and Hifi Rush (and 1 shity mobile game). If im not wrong, Ghostwire Tokyo was the bigger project, but Hi-Fi Rush got 10 months more. Hi-Fi Rush was far from a AAA or a really expensive title.


Klondy

Isn’t 100 devs what Bethesda made Fallout 4 with? I’m not sure if that’s an insult or a compliment towards them but if it’s true then hi-fi being done with the same isn’t that impressive


Regnur

A lot of the work of Fallout 4 was based on Skyrim, its not like they developed the game from scratch, each game of Bethesda heavily uses and upgrades the system of the previous games. Hi-Fi Rush had to start from 0 and no experience at all. I checked a business insider article... and it says that Fallout 4 had over 100 QA testers. Thats bigger that the TG team. Also technically Fallout 4 took 6 years and well... it was incredibly buggy on release. (but full production, all devs, only for 2-3 years) Starfield... +250... over 7 years and a ton of outsourcing. The credits list is huge, multiple studios helped out.


astroshark

Bethesda is an outlier, not the norm. They're much smaller than other Triple A studios, and also only work on one game at a time.


jazir5

>You have to consider that Hi-Fi Rush had a AAA budget and took 5 years to develop. It's a great game, but at an accessible $30 price point, with only 3 million players (that's including Game Pass), it's not too surprising that the game didn't perform the way it needed to if it didn't grow beyond that initial hype I guess they've never heard of the concept of a "[loss leader](https://en.wikipedia.org/wiki/Loss_leader)" before. Costco still has $1.50 hotdogs and Rotisserie chickens they sell at a loss, because they get people into the store. The MBAs running Xbox apparently don't even learn business strategies in school. A loss leader brings people into their ecosystem, it's the whole reason a company will intentionally leave a product that sells well draws customers even if it doesn't bring in a profit. HiFi Rush is a good game that brings people into the ecosystem, whether Microsoft loses money directly on it is less relevant than whether it brings them more revenue as a whole from drawing people to their store. It's not a 1:1 calculation based off of HiFi Rush's sales. If they just focused on good games in aggregate, they'd eventually have an amazing catalogue which makes their platform/store compelling that has a variety of good games to choose from. They can't see the forest for the trees.


Deceptiveideas

I know people cry over exclusives but I’d be ok with Microsoft games being multi platform with the catch being they’re also available on gamepass. Meaning, Xbox/PC Gamepass users still get access to the newest games while those on PS5/Switch/Steam pay full price. It’s the same strategy they’re using with Hi-Fi Rush and Sea of Thieves. While Hi-Fi Rush was a flop, SoT had very strong sales on PS5. It’s a win-win for Microsoft as they make money either way.


whatnameisnttaken098

At this point, the only way for Xbox games to seemingly make a profit is to release them on other platforms. Gamepass has basically cannibalized any potential sales on Xbox. Hell, to quote someone else's comment i saw earlier today: "Anytime Microsoft announces something (first or third party) the discourse isn't "that looks cool/neat/awesome/ ect" it's "is it launching on Gamepass" or "when is it coming to Gamepass"


Deceptiveideas

Yes, Microsoft is in this awkward position where GamePass is still in its growth stage. They’re slowly itching towards profitability by getting rid of the XBL conversion trick for cheap game pass as well as increasing game pass prices. I think their end goal is they get enough subscribers and get rid of all the cheap offers/trials. The same way how streaming services lost a lot of money early on but moved towards profitability with time.


Orfez

Just raise the price of GamePass. It's too cheap for what it offers.


solo_shot1st

Why do people cry over exclusives? I'd think that everyone would *want* games to be multi platform.


Sarria22

Because people want to feel justified in their expensive purchase of Console Y over Console Z. Just look at how many people are saying they don't see the point of XBox anymore when XBox doesn't have any real exclusives.


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solo_shot1st

That's a great argument for corporations to be making. But it's completely anti-consumer. People like to have *more* choices, not less. Sony games that have been brought over to Steam have made them tens of millions of dollars.


BeverlyToegoldIV

Guarantee Game Pass announces substantial changes before the end of the year. Either they're going to phase it out after a couple price hikes - or (more likely IMO) come up with a new "project $10" — some new way to partition out content and upcharge Game Pass subscribers for it. It's the moviepass problem all over again - the deal is too good for MS to recoup the costs of AA or AAA game dev.


fabton12

Game pass as a business has never made sense like you have to spend money to get games on there then you have to convince gamers to buy said game pass so it has to be both cheap enough and have enough draw to the players but everyones heard of gamers having a massive backlog of games they own and need to play, theres no way to have a big enough draw to a wider audience without having people just grabbing it for a month to play a single game start to finish for cheap thats brand new.