$1 billion
That's how much Microsoft may lose in future sales of its Xbox One console thanks to missteps over pricing of the machine and curbs it tried to place on trading video games, according to Michael Pachter, an analyst at Wedbush Securities.
Wedbush Securities analyst Michael Pachter believes it's an incorrect gamers' perception that Microsoft has lost to Sony.
"If we change what our goal is, we're not losing" attitude. Kind of like how Microsoft didn't lose to Valve, they just changed their business model. And they didn't lose to Android and iOS, they just changed their business model. They 100%, after spending 3 generations competing heavily in console hardware, aren't losing to Sony, they're just changing their business model.
You can't ever lose if you just 'change your business model'!
Patcher predicted that take two would be brought out by ea he knows very little about the content of games and is so numbers focused
Yet I remember that he predicted perfectly that there was no way the acquisition of ABK would not go through and that the FTC and the CMA would fold when all the media had It's basically over kind of news.
He mentioned that MS would outsource COD streaming rights (or deny COD from appearing on GP) in UK.
What's kinda crazy to me is - if they retreat from consoles they're left with a business model that depends on making great games that people want to buy.
What has been Xbox's biggest issue over the last decade or so?
It's not like they're falling back to a strength...
They didn't retreat and even promised the biggest generational leap! Where did you get retreat from?
And just think of all those game franchises that are trapped with them, especially those they bought instead of creating.
@Gamer Yeah, just like the One X was a leap. Just like Series X was a leap. What did they bring to the table.....a leap in games? No, they brought sweet f all. Guys like you just never learn or are just dumb, falling for MS' talk talk talk over and over again.
Business is all about money not actual sales. If I sell 1 thing for 1 million and you sell 10000 things for 900k Who really won.
The person who sold 10000 things because he has developed a consumer base and consistent revenue stream while simultaneously showing that he has the capacity to obtain market share.
The person who sold 1 thing for a million hasnt proven much outside of the simple fact that he can get an idiot to pay a copious amount of money for a single product. Holla at me when he has proven he can do it consistently overtime.
This is a nuanced subject matter
How about the gamers perspective
Xbox as a console business is last in the gamersphere. Pivot after pivot, swerve after swerve. If it wasn't for pc the xbox console would died a while back. Console owners need to choose what's best for them, their experiences or the console owners profits
Great. Guess who is in third place (just talking the main console market, not even including mobile and PC) both on software sales, hardware sales, and video game revenue?
***Chris you might wanna do ya research ***
You're right! It's only 2nd place on revenue. Good on you.
"Based on these revenues, we can see that: PlayStation made $11.3 billion more than Xbox, and $14.7 billion more than Nintendo. Xbox made $3.4 billion more than Nintendo."
Now, do you want to find me proof that Xbox isn't in third on hardware and software sales? They've literally cannibalized their own sales via subscription services and their hardware is well known to be last place.
But, hey, Microsoft is okay losing in every category here, why would they get rid of a part of their business that they are in turn (and wasn't accounted for in 2023 numbers totally since it was distributed over 5 years, 2023, 2024, 2025, 2026, and 2027, the cost of their latest purchase) spending more than 7x their annual revenue on.
@Chris I'm glad you did ya research seen you were wrong but you also forgetting this. Revenue isn't everything my friend, remember business is about money
https://www.essentiallyspor...
Oh my days, this is a terrible analogy...
If it was just about money, Microsoft wouldn't be doing a sub model, would they? They are literally making it cheaper than game purchases to get more uptake from more people. The goal is to have enough recurring subs over time to increase revenue (and eventually profitability), but that doesn't work in your assessment because they literally need to "sell 10000 things".
Good grief...
***Revenue isn't everything my friend***
Yeah, you know what that TweakTown report doesn't include? Any of the cost to buy ABK. That makes it a massive loss. Massive.
@DarXyde
That analogy still works, they need to consistently sell those subs to maintain/gain revenue, if they can't constantly sell those subs.
Switch "things" with "Subs", and it still works, but they need to constantly convince people to keep buying that subscription, other people will drop their subscription and revenue will decline.
FinalFantasyFanatic,
I don't think that quite works:
The argument this guy is making actually sounds supportive of Playstation selling a game over Game Pass subs.
Let's take a practical example, Persona 3 Reload.
If Atlus sells you the game at $70 on Playstation and "gives it away" on Xbox as long as you continue to pay for Game Pass, well... Following their logic, wouldn't it be better if fewer people buy it for a higher price than basing it on engagement via more people on XGP? How many people would you need to play P3R on Game Pass to get the same revenue?
Eventually, the latter *can be better*, but there is the matter of a larger install base on Playstation and XGP subs are a fraction of Xbox gamers.
It's a bit ironic and I think biases are on full display because what Philly boi is saying is, in principle, more supportive of the PlayStation model, but the thing is, PlayStation has both a higher price of access AND a larger pool to pull from.
If we want to talk about the manufacturers themselves and hardware, Xbox can be purchased cheaper than PS5, but it is still getting trounced in number of sales and price of admission.
I don't really see how this argument works.
The console war we've been watching for the last two decades has been what I find interesting. I don't really care how much profit MS can make by buying King and running Candy Crush any more than I care how much money they make bleeding businesses for MS Office licenses. That's boring. The fun thing to watch has been the work these companies have put in to try to win the console market.
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The obvious rebuttal to Pachter's cray cray notion is that you wouldn't have to change your model if you were winning.
Or "those who win get to change their business model."
Fanboyism ends at a brick wall of "big company no care about whether you like or hate them, get a life."
Sony said similar things when their Walkman was beaten by Apple and when Samsung surpassed them in the TV market. I can go on and on but I'm sure you get the picture. Business is business. All companies take a whippen every now and and then. The difference is how you bounce back. Microsoft net worth has grown over the years. Business wise they are very successful and no matter what, sony would love to be where they are financially. Sony isn't the competition microsoft worries about. That been clear for a long time now. Microsoft wants gaming to be a part of their ecosystem. Sony needs it. Big difference there.
There's a lot wrong here.
First, the attempt to turn this argument into one about other failed businesses. Which, surprisingly, you make the argument I'm making but then...
Second, the attempt to confirm that Microsoft isn't competition when Microsoft admitted in court that they are.
Third, the attempt to act like Microsoft, from a business perspective, doesn't need what they spent over $100b to acquire but Sony does? Laughable.
Businesses are about profits. If you stop earning enough profit in a division, it goes away. Simple as that. Xbox is a division competiting against Valve, Epic, Sony, Nintendo, Android, and iOS. Simple as that. Xbox, to remain 'part of the ecosystem' needs to not cost the company more than it brings in. Simple.
They actually won.
The whole point was to force Sony into playing ball so that they could not put “windows” in more jeopardy than it was at the time.
Apple, Google, then Sony innovating while partnered with Linux…
When will people realize it has never been about gaming as to why Microsoft got into gaming?
Trojan horses people.
With the way Linux and Steam Deck are going, Linux might one day catch up to Windows, it's doing pretty well for gaming these days compared to say, 10 years, or even 5 years ago.
I don't understand who u r saying won...
But I agree in that I wouldn't be surprised if Windows was part of the calculus for MS supporting Xbox. The OS was based on Windows at first and Xbox One kinda had two Windows instances if you count the hypervisor.
But, like the console space, I think MS is walking back on OS domination. Apple and Google completely ate their lunch because....surprise surprise they innovated. I'm 100% confident the reason Phil talks (and shows) about the Asus ROG Ally more than Steam Deck is because of Windows. The Steam Deck has to sting for them.
Well, yeah, that's the point. They're too big-a-company for fanboy stuff to be at-all relevant.
Well last I checked a company goal is to make more and more money,
Nintendo could be an example of how they stopped trying to compete with Sony (during the Gamecube day) and decided to focus on a different market and reinvented themselves with the WII.
They reinvented themselves with the Switch by bringing 2 markets together when ppl said that portable consoles were doomed thanks to cellphones and tablets.
Sony's business models also changed when they decided to port games to PC something that was never supposed to happen.
If Xbox exits a market (consoles) to focus on another (games) I guess I don't care anymore. They lost the console market and pretty much the same companies that have been there before making games are still there flying a different flag. If they suck, other companies will eat their lunch by making better games.
How's this guy still around. According to him consoles were dying after ps2, ps3 Era.
Analysts are never wrong, the market just had a swift change for which no one could account.
In his Gametrailers past I’ve found Pachter to be friendly and entertaining. However he’s always blindly predicted Xbox success even up to the start of this generation. Now Pachter has adopted and repeated the new terminology of Microsoft, that it hasn’t lost the console war, it just wants more business. This is illuminating because it suggest he, like Tom Warren at the Verge, is inline with Microsoft’s PR strategy.
He was the only person who completely nailed how the ABK court case would play out. When everyone said the deal was dead, he said no and stood firm and said MS would do exactly what they did.
Did everyone say the deal was dead?
Most analytics said it would go through, but be delayed, which actually was the case.
Thing is, if fanboys understood business, they wouldn't be wasting their time commenting on gaming websites.
And you are here to lecture the rest of us because you understand business and MS is doing great?
Technically Microsoft is doing great, it's just not in gaming, OS and software (e.g. Microsoft Office) is where they're doing great business. I can't think of many other ventures they've had that has worked out for them, despite resorting to some of the same tactics that made them the dominate OS for computers.
Microsoft own things like Microsoft Office and Windows, games are secondary to them. If Xbox shut down the computer company will be ok
They only way that plan works is if people still want to play in their ecosystem.
Eventually, they’re ecosystem needs more games.
Helldivers 2 could swing Xbots to ps6 if it isn’t countered by the end of the gen.
Supposedly some well known Halo modders will be making a mode similar to Helldivers.
https://gamerant.com/halo-i...
Without procedurally generated levels, they’ll face the same problem as Destiny: fighting the same enemies in the exact same arenas does get repetitive eventually.
Helldivers succeeds as a GaaS because of its unusually well implemented use of procedural level creation. That, paired with its fun enemies to kill, makes it a GaaS with a long lifespan.
There is a pretty good chance that those with XB also have PS, but not the other way around.
What kind of Jedi mind tricks do you have to come up with to get through your day?
What is the point of always having to lie or make shit up just to win? It's like cheating to win how can you feel like you accomplished something?
I haven't bought an Xbox since the 360 days, just stuck with PC and PS, sometimes Nintendo.
Wedbush games industry analyst Michael Pachter weighs in.
But to a 100 million? Absolutely not I can realistically see 5 to 6 million within the year.
Pachter gets paid for making terrible predictions. Must be nice lmao.
Yea that’s unrealistic. Still the subscriber count is going to increase significantly when Activision/Blizzard games hit the service.
"skyrocket", that's highly doubtful you're not accounting for the fact that the majority of those people who are will download those games on gp already have gp.
I feel they will increase but there are people out there like me for instance that didnt really care for the games they made. Especially cod eh pass. Skyrocket though seems to be overstated.
It won't hit 100 million unless Ms cam produce high quality exclusives and release one every month
Better question is at what price point and subscription number will it become profitable for Ms because the more profit it makes the more resources Ms will allocate to make it grow
Recurring subscriptions is what most companies with services want. Believe it or not the reason so many of these companies want us to turn on the automatic payment is because they know a lot of people forget to turn it off. It's like gym membership they know only 40% of the people will use it while other 60% will keep paying in hopes of going one day
darthv72
Also you made a comment in the other story I forgot to reply to you but why are you paying $45 to renew when you can pay $26-28
There are always deals
This was the first time it renewed for 45, i will get other deals before it does it again.
Reality of the subscriber business model is regardless of the medium, and as Netflix is currently experiencing, they all have a user base ceiling. Is game pass good value, sure, but will it convert non-gamers into Xbox gamers, nope! Brand awareness and deals only reach so far and ultimately a gamer with the money to subscribe is most likely already a gamer.
Nintendo has the ability to turn non-gamers into gamers. The only game that has this ability in Microsoft’s arsenal is Minecraft.
No. Not even Nintendo can "magically" convert non-gamers. Sure as eff such can't be done by the likes of Uncharted or Halo. The best you're going to get is someone who wants to watch for the graphics and action, but sur as eff isn't paying upwards to a publisher desired $100+ per single game + DLC/MT much less a recurring sub.
And it the Bobby Koticks of the industry that need that drilled into their heads, not us.
Nintendo had the wii that brought non gamers. Thats it. Switch isnt bring in non gamers unless your talking about kids having their first system. My kids all have ps4s but we always have bought the newest nintendo console. Mainly for their first party games.
Also i dont feel like minecraft is gonna bring in non gamers. I just dont understand the comment.
Most adult gamers I know still see switch as a “kids” console and don’t own one. I only personally know 2 other adults who use one. So no, Nintendo doesn’t turn non gamers into gamers. They have issues just being seen as a worthwhile system currently with the new generation out.
I was a gamer, and gamed alot. Haven't lately, and got GamePass about 6 months ago, and I friggin love it. Love seeing some smaller indie games that I can play comfortably without worrying about sinking hundreds of hours into like I did when I was younger.
So yes, "non-gamers" will see incredible appeal in gamepass. So far, GamePass reminds me a bit of the good ol' Xbox Live Arcade days, and that's never a bad thing.
Havent lately but you were a gamer. How long is lately. You already admitted you were a gamer so you are not a non gamer even if you took a small break.
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How many xbone consoles did they sell last gen. Approx 50mill.
That's then the max they could hope to have in subscribers.
If there lucky. Very very lucky. As half Their fans jumped ship I rekon.
Which means there gonna have over 50 million subscribers. Sony fanboys have a knack for saying MS won't do X, Y, Z only for them to do X, Y, Z. You'd think you'd learn by now.
Gamepass is also on PC and streaming. Also Series X|S is outselling Xbox one so clearly they didn't lose half their fans.
Michael Pachter, everyone's favourite gaming analyst runs through all the rumoured game company acquisitions that Sony should purchase and deems that Warner Bros Interactive makes the most sense as long as it includes one major thing.
Well, apparently Sony are trying to buy Warner Bros Interactive...
"Interested parties include EA, Take-Two, Microsoft, Sony, Tencent, Netease, and PUBG Corp"
https://twitter.com/imranzo...
I don’t know how you are getting downvoted cause that’s true. I love Sony but they aren’t winning a bidding war. Money talks sadly.
Sony could definitely outbid Microsoft on the basis that Microsoft needs asset allocation in different sectors and seeing how they are going to spend 70 Billion+ on Activision it might be more difficult. Tencent on the other hand, they have as much money as China allows them.
They won't sell for more than 10 billion and Sony can afford it. Ms paid more than 40% above market value . As far as WB are concerned so much of their work is working on established IP's owned by DC. So someone buying WB doesn't guarantee DC IP's
Also I think many of you don't understand the difference between company being valued higher and having actual cash in hand for acquisitions
Also Sony is a bank in Japan so they can come up with cash and have some of the most valuable assets in music and movies. They outright own the movie rights to the biggest and most sold superhero merchandise Spiderman
As far as patcher is concerned I don't believe anything he says. Whatever he says do the opposite
My biggest thing, whoever gets them would own one of the most historic gaming franchises: Mortal Kombat!
The fact it would certainly fail to be approved is a factor. Gov't is pushing back on Activision as it is.
MS is true, but they’re stuck with the Activision stuff and any new acquisitions would completely derail that. Tencent is debatable, and as capitalistic and greedy as the US and companies are there is a real fear of China becoming to large of a superpower that extra efforts have been going in place to slow down Chinese takeovers.
There’s also the influence of relationships and connections within the industry. Would developers rather go to tencent and be stifled, or go somewhere like Sony and be able to thrive.
Also they’re allegedly selling the developers individually so there’s no need to buy the entire company. If anything Netherealms, Rocksteady, and maybe Avalanche are the 3 Sony should entertain.
Not only could they not, there’s very little value in it. WBIE are a subsidiary of WB. One of Sony’s biggest competitors. And they own all the property’s/IP, that WBIE has worked on. That wouldn’t go with them to Sony. So all they would be buying is a developer, not a library of new content and IP to work with. WB wouldn’t hand over those licenses.
WBIE is a good developer for sure, but they aren’t worth as much as some people on here are thinking when you remove all the IP they have worked on.
Don't know why everyone just assumes that Xbox has unlimited access to all of the MS coffers, they don't, and have probably cut back drastically after acquiring the most expensive sinking ship in history.
You're assuming that MS or Tencent would be WILLING to outspend there.
If Sony is willing to pay a price higher than MS or Tencent is, especially if the IP would only be licensed and not owned, then they very much can outbid others.
Sony are interested, but WBIE would be worth considerably more than Bungie which Sony just spent $3.6B on. Whoever buys them will be dropping a lot of money. Especially with companies like Tencent, Microsoft, etc., looking to buy them, that number is going to go up.
Side note: I'm surprised Take-Two is even interested, they're only worth somewhere around $15B or so if I remember correctly. This would be a massive purchase for them, how are they planning to afford it?
In Sony’s shoes, Embracer Group would have been my first and only priority. Imagine getting 240 new first-party IPs over night. IPs they can use for games, TV shows, AND movies.
I don’t know what the hell Sony’s thinking spending billions of dollars on these smaller lukewarm acquisitions when they could’ve pooled their funds for one significant purchase instead.
If it is as straightforward as giving money, they could easily be outbid and that's the end of it.
However, they might sell for less if there were other conditions. Bungie and Activision were overvalued, but I think it's not unreasonable to suggest prices are negotiable if it comes with other benefits.
Development costs must be nerve wracking if acquisitions are so in season now.
Logic
Embracer group would cost upwards of 40+ billion so I don't think that's happening along with the fact embracer group themselves are acquiring talent
'Michael Pachter, everyone's favourite gaming analyst'
I hope this statement was made as a joke.
Well, Michael Pachter, if YOU were really smart, you'd be right more often. You're strike rate is awful as far as gaming goes.
So show some stats... I'm not a Patcher fan by any means, but at least back up what you're saying.
Or are you just looking for some easy up votes?
I never said he wasn't, but you guy's just regurgitate the same BS and never provide sources to back it all up.
Are you new to following gaming news or are you just looking for some easy downvotes?
I'm happy for you to show me I'm wrong. Seeing as you feel so strongly about it, I'm sure you must have the stats I'm missing and can back up your outrage?
https://segmentnext.com/a-v...
Yes, he's a hack.
Stats on how wrong he's been in the past:
1. Grand Theft Auto V would release 2010 (released Sept 2013)
2. Predicted the price of Kinect would be $50.00 (was over $150)
3. Said Microsoft would double the price of Xbox Live
4. Said Wii was in no shape to compete with Xbox 360 and PS3. (Wii outsold both)
5. Said Assassin's Creed 2 would feature Altair and would be set in the French Revolution.
6. Predicted PS3, Xbox 360 and Wii would be the last generation of consoles.
7. Predicted Xbox One was going to outsell PS4 by 75,000 units. (PS4 tripled Xbox One sales)
That's just the ones in the article.
Console will be dead . Sony will lose to Xbox last gen just off the top of my head . He’s said a bunch of dumb shit , I don’t need to catalogue it because he does it so often .
"but you guy's just regurgitate the same BS and never provide sources to back it all up."
Why? It's not a court of law, those of us who have been following gaming news for the past 15-20+ years all know he is a hack.
If YOU don't agree, that's fine, just ignore it, or do some digging yourself and find out for yourself.
I for one am impressed by one thing Patcher has that most people don’t: the ability to miss the mark, over and over again, and still have a job. Most of us have to consider something called job performance, or in the case of self-employment, public perception is often key. It baffles me to no end that Patcher has somehow transcended that. Is that a perk of being rich and famous?
agreed we need to keep the filthy CCP out of gaming at all costs. China owns most of hollywood and influences much of the media with their filth. If gaming goes to the commies it might as well die
"According to Michael Patcher."
So they really made $1 Billion?
Wow, one of the shortest articles I've read in a long time. That's it? That's all the information we get?
Literally just one paragraph.
If this article passes that is just unfortunate. No calculations, methodology, nothing. Not even a quote.
Xbox One damage is irreversible so as to teach them a lesson on trying to benefit from their customer's loyalty/ marketshare.