MS releases Xbox One S All Digital edition (No Optical Drive)

[iroboto]

My post said it depends on the game and you can find examples to suit either argument. But let's run with this one. You can buy RDR2 second hand for $51. You can play it for a month. You can then sell it for...what...$40? Total cost to play the game is ~$10. Or going with those prices, you can buy new for $60, play it, then sell it for $51 for a cost of $9. That's $9 to play it now rather than waiting until RDR2 is $9 in a digital sale, if it ever drops that low. For the really hard up, this is the most economical way to game. They can also not buy new games and buy old, super discounted games. By including a drive, they can use both physical and downloads for whichever is cheapest. Excluding the drive means excluding the physical options.

I'm not arguing in favour of keeping the drive, but pointing out no-one has sufficient data to know the best course of action, empirical experience is not statistically relevant data, and a fair argument can be made for the running cost advantages of keeping the drive.

Yup.
As long as you can wait, you can be the outlier on a standard distribution of used game sale pricing. There is effectively an entire industry around used game sales, it must be very profitable if they can continually buy and sell games and still take some off the top.
Hell I find games for $1 in the bargain bin. If they've managed to make profit there then, wow.

 

[liolio]

Irobo, I saw a headline in the last few days dtating that msft was the most valuable company in the world. I didn't read the article neither I checked the source I just saw the headline. I also know that msft as its hand in many things and they had a lot of success with many of their extended business though they still mess up a lot of things, phones, tablets and having competitive market place. Same with the Xbox brand this gen. Imo it ia not bad luck they make plenty of bad decisions on a lot of their products intended foe the public.

Satella is doing a great job as even with less then optimal choices the divisions concerned with the bad are still making profits /accounting is under control.

 

[dobwal]

How much does it cost to design a second sku with a new MB, new production lines, and get it pass worldwide regulatory approval for utility power and interference specs? Then all the supply chain managing the additional sku?

It's not an easy sku to add, the reasons to make this has to be more than just a slightly smaller case and a slightly lower price for a fraction of gamers who already have an xbox and don't care about trading games. It has to be about GaaS.

I can easily see a discless sku being part of the their proposed subscription model where a monthly fee over two years gets you the console, live and game pass.

It’s a perfect device because if you try to stiff MS they can simply shut down the console by denying access to Xbox services. You can’t use physical discs as a work around. It can’t even be used as a Blu-ray player. It simply becomes a brick.

 

[iroboto]

I can easily see a discless sku being part of the their proposed subscription model where a monthly fee over two years gets you the console, live and game pass.

It’s a perfect device because if you try to stiff MS they can simply shut down the console by denying access to Xbox services. You can’t use physical discs as a work around. It can’t even be used as a Blu-ray player. It simply becomes a brick.

or a bit like a set top box, you're just always paying the rental and sub price to use the service.
Yea I can see this POV, price has better be compelling as in the long run it doesn't seem like a good way to keep playing. But if you don't like paying big lump sum, this would suffice at $18-20 per month for a console with games.

 

[eastmen]

How much does it cost to design a second sku with a new MB, new production lines, and get it pass worldwide regulatory approval for utility power and interference specs? Then all the supply chain managing the additional sku?

It's not an easy sku to add, the reasons to make this has to be more than just a slightly smaller case and a slightly lower price for a fraction of gamers who already have an xbox and don't care about trading games. It has to be about GaaS.

I'm not sure how much it would cost but didn't they do the same exact thing for the xbox one s and xbox one x . MS can design a new smaller board that can be used going forward from here on out and it can be used in the xbox one s shell. Heck they might even be able to make the xbox one s smaller with the new board also. Yes they would need an additional production line but they are already running two different lines.

The rumor from thurrot includes a program where one can send in their discs and get the digital edition free. So perhaps the normal one s goes away and this is the redesign and if you want a disc you buy an xbox one x . If we are talking a new generation in 2020/2021 then the xbox one s wouldn't be long for this world anyway at this point. A 2019 discless replacement would see it go into the $200 and below range or perhaps with a 7nm shrink even lower in price and that is their strategy . Perhaps a xbox one s sans disc / xbox one x and xbox next is their strategy at $200 / $300 / $500 or $150/$250 / 500 or something . One s wouldn't get new games at some point but only streaming editions

 

[eastmen]

I can easily see a discless sku being part of the their proposed subscription model where a monthly fee over two years gets you the console, live and game pass.

It’s a perfect device because if you try to stiff MS they can simply shut down the console by denying access to Xbox services. You can’t use physical discs as a work around. It can’t even be used as a Blu-ray player. It simply becomes a brick.

all that stuff is through dell perfered. Its all done through credit checks and will hit your credit if you try and stiff them. But yes this as part of their subscription model could be a big deal. If they get it small enough it can compete with the higher end fire tvs and nvidia shields and what not.

 

[iroboto]

I'm not sure how much it would cost but didn't they do the same exact thing for the xbox one s and xbox one x . MS can design a new smaller board that can be used going forward from here on out and it can be used in the xbox one s shell. Heck they might even be able to make the xbox one s smaller with the new board also. Yes they would need an additional production line but they are already running two different lines.

The rumor from thurrot includes a program where one can send in their discs and get the digital edition free. So perhaps the normal one s goes away and this is the redesign and if you want a disc you buy an xbox one x . If we are talking a new generation in 2020/2021 then the xbox one s wouldn't be long for this world anyway at this point. A 2019 discless replacement would see it go into the $200 and below range or perhaps with a 7nm shrink even lower in price and that is their strategy . Perhaps a xbox one s sans disc / xbox one x and xbox next is their strategy at $200 / $300 / $500 or $150/$250 / 500 or something . One s wouldn't get new games at some point but only streaming editions

Normal SKU isn’t going anywhere. There are a great deal of markets in which Xbox needs to grow like South America.

 

[Silent_Buddha]

Is what I'm saying really just going over peoples heads, which mean I'm obviously not doing a good job in explaining it even though i have tried many times.

Digital is not an exclusive positive to a discless sku.
It's the same positives for the standard sku.
You have a disk drive, but don't want to go to the shop, you can still buy it digital, you are not forced to buy physical.

Maybe it's so obvious people think I'm arguing something different?
Think me trying to explain that the positives of digital is the same for all sku's is over, as I'm obviously only going to keep repeating it and clog up this thread.

Sure, those are valid points, but diskless has other potential benefits.

A potentially lower cost floor that affects brand perception.

Despite the loser cost X360 SKU being less popular than the higher priced full features X360 SKU, it gave the perception that the X360 was the more affordable console on the market. If they can price it at 179 or so, it'll have that extra psychological factor of being a sub 200 USD console that isn't just marketing (199 while being sub 200 isn't as impactful as 179 being sub 200). That's likely more than the cost of the optical drive, so MS would likely have to eat some of the cost or find other cost saving measures (no HDMI in, for example).

As some have mentioned there's also the potential to turn it into something akin to cell phone service. A discounted or even free diskless XBO with say a 2 year Xbox Gamepass contract (full subscription price) or something along those lines.

Regards,
SB

 

[Jay]

Sure, those are valid points, but diskless has other potential benefits.

A potentially lower cost floor that affects brand perception.

Despite the loser cost X360 SKU being less popular than the higher priced full features X360 SKU, it gave the perception that the X360 was the more affordable console on the market. If they can price it at 179 or so, it'll have that extra psychological factor of being a sub 200 USD console that isn't just marketing (199 while being sub 200 isn't as impactful as 179 being sub 200). That's likely more than the cost of the optical drive, so MS would likely have to eat some of the cost or find other cost saving measures (no HDMI in, for example).

As some have mentioned there's also the potential to turn it into something akin to cell phone service. A discounted or even free diskless XBO with say a 2 year Xbox Gamepass contract (full subscription price) or something along those lines.

Regards,
SB

Those are all benefits to MS.
I've been very vocal on the fact that I believe a discless sku is good for many reasons

But that game pass, ea access, digital isn't what makes it better than any other sku, is my point because it's not like you don't get all those benefits with those sku's also.

My point was that it has a slightly lower entry point for consumers, but I'm not fully convinced that the extreme budget conscious would choose it as they may feel that losing out on the benefits(savings) of what physical can also give.

Examples people use like convenience of digital, benefits of game pass, lack of value you get back from trading disc, don't hold up because the discless sku is a subset of features, the disc version has them all.

But as I've said I'm all for discless sku, for both the base and 1x personally.

 

[lefantome]

Passes and streaming if pushed to be the only option will be a disaster for the industry.

I mean the industry that is creative and those who want and play good games. For those who want profits and steady income they are a blessing.

 

[eastmen]

Passes and streaming if pushed to be the only option will be a disaster for the industry.

I mean the industry that is creative and those who want and play good games. For those who want profits and steady income they are a blessing.

We can have both . We have both right now. On black Friday for $70 you could have bought a year of game pass. There are a lot of great games on that pass and a lot getting added next year for about the price of a single game. I don't see how its a bad thing for consumers ?

I mean I have Netflix and hulu at home but I still go see stuff in the movies when they come out and I buy blurays from time to time if I really like the movie

 

[BRiT]

I'm subscribed to Game Pass until November 25, 2021 and all I ever paid so far was $60 -- those Bing Reward points are such a bargain to get services for free! I have more codes to redeem for 1 month, but they wont let me stock up any more than 3 years.

Even at $60 each year, that's what I'd have spent on just a single game and instead I get a hundred more games. So far there's been at least 2 major games I'd have bought in a year that's on it, so even at $120 it's a good price.

Some of the games I played because they were on the service, I never would have even looked at or considered buying were it not for the service. It certainly been great for this consumer. They also made money from being on the service. I'm now on the look out for other games by those developers, so it expanded their market and is a benefit for them.

I don't see how it's a disaster for the industry.

 

[Shifty Geezer]

We can have both. I don't see how its a bad thing for consumers ?

Lefantome said 'if we have only'.

 

[eastmen]

Lefantome said 'if we have only'.

yes but we have both and its a good thing.

 

[Shifty Geezer]

Leftanome is discussing the future, not the present. Would a move to only subscriptions be a good thing or not?

 

[iroboto]

Leftanome is discussing the future, not the present. Would a move to only subscriptions be a good thing or not?

no it wouldn't.
But it hasn't happened yet, and MS has been clear on their statement that they aren't going that way. So i'm not sure if this is a topic worth discussing unless you're just not trusting MS at their word ever which is a different argument altogether.

 

[Shifty Geezer]

I'm not that interested in the discussion and it's really its own topic. However, I wouldn't trust any company, especially global megacorps, at their word. If a change in policy is deemed more profitable, they'll u-turn against all promises. The future will be determined by how well these subscription services are taken up.

 

[dobwal]

Leftanome is discussing the future, not the present. Would a move to only subscriptions be a good thing or not?

There is no need to go for an only sub model. A future console market will be not unlike what we have to today with films.

Releasing games like RDR2 to collect a billion dollars in a matter of days and weeks and subs that give access to hundreds to thousand of games because very few can even afford to pay $5 for each and every game in your typical console library.

It’s all about using multiple models to extract a level of revenue from a library that a single model can’t do on its own.

 

[JPT]

It’s all about using multiple models to extract a level of revenue from a library that a single model can’t do on its own.

Yes, but is the markets that those different models address large enough to cover the overhead/extra cost they indur to put out a product for that market? How many got the broadband connection that can support the business modell, that is your potential marketsize and just a subset of that will be your customer in the end.

Also its impossible to to know how many less deices with discs they will sell if they launch a discless device. There is an overlap somewhere here. And the discless modell might affect the price of the one with disc, due to volume might be less of the disc version and then the volume price for the diskdrive is not as good.

There are many variables that we do not know or can account for, so armchairing means back of the envelope calculations might be way way of.

But it would be very interesting to see if MS tries this approach, I never buy physical disc based games anymore, but how many of us are like that. I see on here all the time that people buy discs to trade or resell etc.

 

[AlNom]

Anyone have trends for Gamestop trade-in revenue over the last few years?