Online discourse about Game Pass remains undefeated in terms of drama.
If you haven’t been following the scuttlebutt over the last couple of days regarding Game Pass, the gist is this: Chris Dring of thegamebusiness.com released a statement on Twitter stating that the last time he asked Xbox whether Game Pass is profitable they responded that, yes, it is profitable, but that it didn’t include development costs of first party games. The internet, in its furor, decided that that meant that Game Pass isn’t really profitable at all.
Fast forward to today and Mr. Dring released an updated statement saying that multiple sources have reached out to him stating that even if first party development costs are attributed to Game Pass it is still profitable.
And on the usual sites I saw the well…usual comments. Before Dring went back on his statement they were all agreeing with it, afterwards their argument is that big, scary MS told him not to do this and he doesn’t want to lose contacts there, or that he was bullied into saying this.
It’s hilarious.
Maybe, just maybe the service is profitable after all? It’s a crazy thought, I know.
Despite Xbox and him outright saying it’s still profitable when accounting for first-party development costs some people STILL can’t believe it. Willful ignorance abounds.
An example of some prime discourse I’d like to highlight:
Read: Microsoft/Xbox cannot be responsible for the accounting of their services/products. It must be devised by someone else and then forced upon them!
Read: Sony/Playstation CAN be responsible for the accounting of their services/products. Whatever method they use is correct. Nobody else should be able to question their accounting methods.
Read: The conclusions Sony/Playstation make from their accounting methods are unassailable. You are to believe those conclusions implicitly and unquestioningly.
Whether intentional or not (we know the answer…) he’s added to the discourse that Gamepass isn’t sustainable/profitable and how bad it is for the industry. Essentially adding more negative fuel to the fire around the Xbox brand (which Microsoft played a part in last week of course).
Maybe i don’t look hard enough as i don’t really go on other gaming sites, but it seems crazy how much negativity there is around Gamepass. We’re all from different parts of the world but likely all experiencing cost of living struggles and Xbox have offered not only a cheaper next gen entry point, but a service that allows gamers to still enjoy, not old, but new and modern games. Yet the service gets tainted like it’s a cancer on the industry. Imagine essentially telling people “Don’t use that brilliant value for money option that lets you play so many games at a good price, you should spend £70 per game” which would limit some people to one or maybe even two games a year…
It’s because that’s the media playbook; any time there’s a negative Xbox bit, it’s time to pile on and repeat the same news/lies over a course of several weeks and dozens of articles. When it’s Sony, insomniac, or a select few others it’s “think about the devs” while they report on it once and move on without ever mentioning things like Sony closing two of the oldest studios in industry history or closing a total of either studios over the last nine years, or cancelling a dozen games and laying off thousands as well… because poor big corpo Sony.
This topic feels a bit empty without a link to actual journalism done by Jez Cordon of Windows Central on this topic:
In conversations with various Microsoft sources, I’ve been told that Microsoft performs calculations based on per-title retail forecasts, which includes things like Xbox, PC, and now PlayStation version game sales, among other factors. And then, it combines that information with the title’s Xbox Game Pass engagement. It then adds the net result to Game Pass profit and loss (P&L) statements for that title, essentially charging Game Pass for forecasted “lost sales” on Game Pass platforms. Engagement and reduced churn are factored as success indicators on top. What Microsoft spends on acquiring content and marketing Game Pass is also naturally factored into its P&Ls.
What Microsoft doesn’t do is factor in Game Pass cannibalization at the point of funding the game outright. Given that games are being built for a variety of endpoints and business models, sources argued that it wouldn’t make sense to put the entire dev costs of titles like Call of Duty or DOOM: The Dark Ages on top of Game Pass — unless the game was going to be fully exclusive to Xbox Game Pass as its only mode of sale and access. Microsoft performs the calculations after seeing how the title performed in the marketplace.
In essence, Microsoft sources say it does charge and account for first-party games cannibalization against Game Pass. But perhaps there are wider issues worth accounting for as well.
Just to further add, the business model around Xbox Game Pass revolves around engaging users who would otherwise only play freemium titles, or potentially only play 1-2 titles per year — which was the average per console user attach rate both before and after the advent of Game Pass. If an average user who typically does only pay for a couple of games per year stays subscribed for any length of time, they beat that average per-user profitability, while also adding value by engaging and potentially sharing content around those games.
To add to the data about gamer behaviors and how that plays in with the business model around Xbox Game Pass.
From the data provided by Mat Piscatella of Circana, 30% won’t buy any game in a year, around 18% buy 1 game every 6 months or less frequently, and about 12% buy a game each month. From his other statements at other times, of the time spent gaming, around 40% of the time is spent on the same Top 10 live service games.
Most actual journalists would verify any aspect of a story before rambling off some verifiably-false take… but this is the post-truth era and the games media is embracing it like it’s candy.
“No need to worry about any element of fact-checking or equality in reporting, we want Xbox dead because they have the audacity to exist” basically…
This is the dude who posted a couple months ago about developers not seeing the point of porting to Xbox and then “clarified” that the source of the info was his imagination.
Nice gig he’s got going, past whatever fanboy rage bait comes into his head, then just walk it back a few days later, no harm no foul.
Ding is digging himself a neverending grave at this point cause i feel like he really wants to make xbox look at him and try something, which am suspecting they could potentially if he keeps making this sort of comment.
I still laugh alot when i recall how a well know grifter got his just desserts when it was releaved that the info he gathered was false since the person who told him the info was doing so to make a fool out of him and prove a point of the dude’s stupidity and nonsense.This feels like the exact same thing in a way.
Chris Dring never ceases to amaze me on how incompetent he is as a journalist. I’ve seen far to many try to give this guy the benefit of the doubt. He doesn’t deserve it.
First it was 'Xbox is pulling back and deemphasizing Game Pass, only to have Xbox announce at the showcase that COD: Black Ops 6 was launching Day One in Game Pass.
Then you have the whole, third parties no longer see a point in porting to Xbox, only to have Capcom, Square, Sega, double and triple down on ports to Xbox. Even their own rival is beginning to port games to Xbox.
And now you have this. The sad part is, people will still quote tweet the next ‘sources have told me’ drivel that comes from his account as if he is some reputable journalist.
Ah more Schrödinger’s Game Pass. It is both something not enough people will use to sustain itself and also something that will be used enough to kill console gaming as we know it.
I think it’s about the variety of games that the ‘hardcore’ play. Like instead of playing 1 or 2 games all year, they would play from 10, 20, 30, 40 and more games a year.
I myself do play a lot of games(I think I’m about 20 games in this year), but I wouldn’t really call myself hardcore.
No need to fact-check when it’s Xbox. If this was PlayStation, I guarantee they would be triple checking sources, consulting with business/financial experts, gathering developer opinions on both sides of the debate, and then and only then report it (with a few caveats of course).
