It’s quite a contrast to North America. I could go on about it; but we’d be in RSPC type talk. TLDR huge movements to defun public services and including education and libraries.
Business aspects of Subscription Game Libraries [Xbox GamePass, PSNow]
- Thread starter iroboto
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cheapchips
Veteran
On my Xbox dashboard, "Time is running out. Renew now!" I have six months left to go. Didn't realise it was time to panic.
I've been seeing that sometimes even when I was stacked out to 3 years.
I think sometimes their backend times out on checking when your services expire so you get shown a default tile.
Michellstar
Regular
Nah, wait till black friday or Christmass time. It´s were they drop nice Gold*/Gamespass deals
* Does it go away??
You think Sony or MS really care about this segment of the market especially during launch?
These platform owners give up profit off hardware in an effort to drive adoption and increase software sales where they make the bulk of their profit.
If much of your playtime on consoles comes from games borrowed from a library, how much are you contributing to the profit model of these consoles? Do libraries purchase enough software to warrant MS or Sony to support such users?
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Johnny Awesome
Veteran
The whole library thing is ridiculous. LOL.
D
Deleted member 11852
Guest
Unless Series S gets a revision with a disc drive it doesn't matter if it is at launch or three years down the line, the problem remains. And I know folks like this aren't bringing much revenue direct platform holders but if they're part of game communities like Fortnite, they are numbers help keep games active and active games are a reason for people with money to invest in micro transaction content.
In this new gen, the only way these gamers are going to get a launch console is if they scrape up 429 pounds (?) versus 249 pounds for the cheapest DE. They effectively will have to pay an additional 180 to utilize public libraries for these new consoles.
Do you have any numbers regarding library use. How many units of any one game does a library typically carry? There are 5k public and academic libraries in the U.K. Is each library carrying 5, 10 or 20 games per title which would result in just a total of 25k, 50k or 100k in units across the U.K? Is the U.K. spending millions on each game title to stock that level of units across the U.K? How are those numbers divided across platforms?
cheapchips
Veteran
The 15m do still include plenty of Gold $1 conversions. I'm sure they'll be 'sticky' subs though. Aside from the shear value (for most people) people are utterly rubbish at cancelling things.
D
Deleted member 7537
Guest
What's the operating margin for Gamepass?
I plugged in really conservative ballpark numbers and basically had them at negative for quite a few years until they hit 20M subs.
But essentially itr's $10 per customer with a Cost of acquisition of $6 a month (so really only 40% of the population is paying for the entirety of revenue for game pass) and a gain rate of 5% more customers per year. It was going to take them 5-8 years to get to 20M. It's not even been 5 months since the 10M mark.
I had their costs to be 2B a year for studio and licensing fees increasing 6-8% in costs YoY
How does that look now after spending another 7.5B?
It's a 1 time capital cost, so It's not recurring operational expenses. Hard to factor that in unfortunately. But if they get to 20-30M subs a month, they're rolling in cash. The interconnection of EA Play and GamePass may be a greater strain on operating margin than the Zenimax purchase.How does that look now after spending another 7.5B?
Updated Predictions to now include 15M subs and increasing firstparty operating expenses by 500M per year growing 10% yoy in costs.
https://onedrive.live.com/edit.aspx?resid=18410220DF77FB8!66451&ithint=file,xlsx&authkey=!AEgNyvD8n8NwRok
This has MS green by 2026.
To be clear I shouldn't be filing 1st party studios under Game Pass, since they sell those titles everywhere and I don't take account for that in this spreadsheet etc. But w/e - I am aiming for a terrible case scenario for Game Pass.
https://onedrive.live.com/edit.aspx?resid=18410220DF77FB8!66451&ithint=file,xlsx&authkey=!AEgNyvD8n8NwRok
This has MS green by 2026.
To be clear I shouldn't be filing 1st party studios under Game Pass, since they sell those titles everywhere and I don't take account for that in this spreadsheet etc. But w/e - I am aiming for a terrible case scenario for Game Pass.
That 7.5bn is quite a dent, and we still don't know how many of that 15m are paying what...
Well I assume you mean 1 more (subscription) but maybe M/S count this as 2? Who knows.
Assuming they don't have other costs and don't buy any other studios and everyone is paying full price...it's still some time to payback.
To put it another way, you can't simply say this deal 'only' cost 7.5bn (because of ongoing costs to run the company) and then you can't say 30m x 10pm = paid off in 2.5 years because it doesn't work like that either.
Operating costs are included in the spreadsheet, so I udapted that to include an additional 500M a year with an increase of 10% YoY, it could be higher, but I doubt it.
I can't include the 1x purchase price into the spreadsheet.
edit: nvm. I saw the employee count at 2300 employees
hmmm loaded rate say is 100K per employee.. so 230M a year more.
Which is much less than my 500M more per year estimate
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