Microsoft Losing to Sony Is a Wrong Perception, Says Pachter; They Want to Win Business, Not Console

Wedbush Securities analyst Michael Pachter believes it's an incorrect gamers' perception that Microsoft has lost to Sony.

[Christopher]

"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'!

[Jin_Sakai]

Pachter is full of crap. Always assume the opposite of what he says.

[Cacabunga]

This clown is still around? I cannot remember he ever got one prediction right

[piroh]

He's paid by MS

[Profchaos]

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

[blacktiger]

Microsoft actors

[Petebloodyonion]

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.

[crazyCoconuts]

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...

[GamerRN]

They didn't retreat and even promised the biggest generational leap! Where did you get retreat from?

[crazyCoconuts]

@Gamer if you don't see it yet, there's nothing i can say to convince you.

[FinalFantasyFanatic]

And just think of all those game franchises that are trapped with them, especially those they bought instead of creating.

[Charlieboy333]

@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.

[PhillyDonJawn]

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.

[remixx116]

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

[The Wood]

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

[Christopher]

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?

[PhillyDonJawn]

Chris you might wanna do ya research

[Christopher]

***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.

[PhillyDonJawn]

@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...

[DarXyde]

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...

[Christopher]

***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.

[FinalFantasyFanatic]

@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.

[DigitallyAfflicted]

ou can do math... well done.... you win

[DarXyde]

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.

[crazyCoconuts]

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.

[Eonjay]

The obvious rebuttal to Pachter's cray cray notion is that you wouldn't have to change your model if you were winning.

[senorfartcushion]

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."

[Reaper22_]

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.

[Christopher]

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.

[Rude-ro]

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.

[Christopher]

Tinfoil hats people.

[FinalFantasyFanatic]

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.

[crazyCoconuts]

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.

[senorfartcushion]

Well, yeah, that's the point. They're too big-a-company for fanboy stuff to be at-all relevant.

[S2Killinit]

Lol 😆

[badz149]

If Pachter said MS is not losing, it means that MS is losing.

[Petebloodyonion]

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.

[crazyCoconuts]

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.

[shinoff2183]

How's this guy still around. According to him consoles were dying after ps2, ps3 Era.

[Christopher]

Analysts are never wrong, the market just had a swift change for which no one could account.

[shinoff2183]

Aka wrong lol

[VenomUK]

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.

[Tedakin]

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.

[MrNinosan]

Did everyone say the deal was dead?
Most analytics said it would go through, but be delayed, which actually was the case.

[Christopher]

Almost everyone said the deal would go through.

[stonecold3]

michael and his bs view just give me headache wish he would go and retire

[senorfartcushion]

Thing is, if fanboys understood business, they wouldn't be wasting their time commenting on gaming websites.

[S2Killinit]

And you are here to lecture the rest of us because you understand business and MS is doing great?

[neomahi]

senorfartcusion....... So what brings you to the house of Pachter?

[FinalFantasyFanatic]

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.

[senorfartcushion]

Microsoft own things like Microsoft Office and Windows, games are secondary to them. If Xbox shut down the computer company will be ok

[MIDGETonSTILTS17]

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.

[Abnor_Mal]

Supposedly some well known Halo modders will be making a mode similar to Helldivers.

https://gamerant.com/halo-i...

[MIDGETonSTILTS17]

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.

[darthv72]

There is a pretty good chance that those with XB also have PS, but not the other way around.

[shinoff2183]

I do. Always get an xbox just varies on when during that Gen

[cooperdnizzle]

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?

[FinalFantasyFanatic]

I haven't bought an Xbox since the 360 days, just stuck with PC and PS, sometimes Nintendo.

[derek]

Pachter is a deranged Sony hating idiot. This so called analysts has been predicting the demise of playstation for years now (kinda like Jaffe). After the ABK deal passed regulators, he was so gleeful that "dumb Sony" was finished. Now that reality has brought big mighty Microsoft on bended knees offering up their games unconditionally, the goal posts shift again. Now it was all part of the plan. Seriously this guy is an embarrassment to his profession, in how is opinions on Playstation comes off as being driven by weird energy towards them as a company.

[senorfartcushion]

Calm down

Sont couldn't care about you liking them, nor would Microsoft. L

[derek]

@senor, you worry about yourself you dope.

[senorfartcushion]

Calm down.

Being a console fanboy is stooooopid

[Kiryu1992]

Good for us gamers. People need to realize MS owns a lot of IP’s so then allowing their games on other platforms is a huge win

Business is changing and now it’s about having content on as many platforms as possible. I for one hope after these 4 games there are other games from MS which will end up on PlayStation and Nintendo along with pc. The argument from Xbox fans is nonsense because they will still get all exclusives day one on GP while others are paying full price or waiting on sales

[shinoff2183]

Ms is changing. The third place company usually doesn't make changes that the others swing to. Don't bring up gamepass cause segatv and psnow were first. Sony did redo psnow into psplus but it's not the same.

[Asterphoenix]

Patcher has always been wrong on his predictions for years. A quality track record that guy.

[CobraKai]

So if i tap out in a fight, but my new goal was to not get knocked out, i win?

[S2Killinit]

Lmao 🤣

You made my day.

[blacktiger]

This guy lmao lol

[Hereandthere]

The PlayStation smear articles are back in full force, my lord is the seething real. These are pc and xbox players jealous of the many upcoming exclusives.

[TheColbertinator]

If Phil Spencer says it is true, then it must be true. This is my life philosophy.

[S2Killinit]

Is that really you? Is this sarcasm Im sensing? What happened? You saw the light or something?

[vTuro24]

Holy shit this dude is still around.

[hiroyukisanada]

Pachter has been riding MS's d*#k for several gens in a row and DOGGING Sony every chance he gets lol I don't put stock in anything he says anymore because he only props up Microsoft while crapping on Sony and Nintendo.

[mastershredder]

Lost me at "Win Business". Win what exactly? All the market share and flood it with one company's mission? Get wrecked. Pachter take a huge flying leap off of your fart cloud that you are jet-intake inhaling.

Also, a Video game analyst with a horrible track record for accuracy is offering expertise on winning. Hilarious.

[senorfartcushion]

This is part of why fanboyism is dumb

[Futureshark]

If you constantly move the goal posts to a favourable position you'll never 'lose'.
However, by doing this you'll only give yourself a false sense of victory as everyone else will see you have only cheated yourself.

[DefenderOfDoom2]

Michael Pachter needs to stop comparing movies to video games. I can have 2 broken wrist and the flu and still watch a movie but with 2 broken wrist and feeling sick it would be difficult for me to play a video game.

[Travesty]

I didn’t know this guy was still around. I figured he was enjoying his golden years somewhere that wasn’t video games because he always off by a mile. I mean I think the average gamer could really out analyze him with no problem.
Yes we know Microsoft’s end game. But it’s hard seeing that come to fruition at this state of 33 million including the 12-13 million Xbox gold players.
I guess if they can buy more publishers and studios with their trillion dollar company they can out business Sony. Buy up the market forcing people to have gamepass to play games will definitely get their 300 million subscribers.

[Skuletor]

If Pachter's saying they're not, then they most likely are.

[PassNextquestion]

Microsoft has definitely lost to both Sony and Nintendo in the console Hardware buisness. Now in terms of software they already have surpassed both Sony and Nintendo as the largest games publisher.

[neomahi]

Maybe. But this dude's losin it

[Crows90]

This guy forgot that gamers are interested in consoles.

[RhinoGamer88]

I wonder if that line/reasoning is how Phil and his VP team keep their jobs when MSFT demands better.

[YourMommySpoils]

Cause to this Patcher, consoles aren't a business? Wtf

[Destiny1080]

putting all your exclusives on your rival platforms with higher framerates and better features

I'm not seeing a massive win here, unless its opposite day, also known as E3

[DaniMacYo]

Could have fooled me this whole time I thought Sony was winning. PlayStation having huge success must mean Xbox and Microsoft are not losing. Sounds legit.

Haha LMAO. This guy must doppelgänger as stand up comedy in his spare time. What he said was hilarious.

[DefenderOfDoom2]

"Long long game ".Seems like Microsoft wants to sell video games on all consoles and platforms out today . Michael Pacther even said. not until 10 to 15 years from now that we will see people just use their phones to play COD . Probably longer than that I believe.

[gold_drake]

the only ones that think that this is about winning or losing is Spencer.

and Pachter is also talking out of his arse alot.

[BrainSyphoned]

Ineptitude:Pachter

[GotGame818]

Why is this guy still relevant? He is wrong most times!

[sickhate]

Like steam is doing? Well…better start going cause i aint seen nothing yet…

[BillyCrystals]

Shut up, old man

[DOMination-]

His point isn't wrong. Microsoft are clearly pivoting away from a model where selling consoles is a priority. I don't think anyone can dispute that in future they are looking to subscription numbers and digital sales as the barometer for success and in most part, this change has occurred because console sales its a battle they can't win - Phil Spencer said so himself just after Redfall launched.

Where Michael is wrong is in the analysis of the situation though. It doesn't matter what barometer you use currently - be it consoles, subs or sales - Microsoft are losing in all of them - and badly.

Time will tell whether that will ever change. MS are well positioned as a publisher but they send mixed messages. On one hand you see a lot of promising single player story games or RPGs but with the other they talk obsessively about monetisation and mobile. Maybe we can have both but forgive us all for not trusting them based on their recent track record.

[anast]

I always avoid people that try to trick people into believing they are stupid. Patch is a Class A.

[CrimsonWing69]

So, why not just make cheeseburgers then? They’re losing in the console arena—in the game industry and to Sony. That’s their business and they’ve just been utterly failing at it. Now, they may pull a Sega and abandon making hardware and will no longer be a major publisher, sure ok, but thats a dramatic shift in power and position. Sega is no longer doing Nintendo or PlayStation money. So, I’m not sure how much of “winning at business” they’re doing in the console arena.

[Agent75]

They're all in it for the money obviously, many gaming companies have shifted away from consoles such as Atari, SNK and SEGA as examples. Never understood why Microsoft joined the 'console war', which at the time, it was up against the Dreamcast, GameCube and PlayStation 2, not forgetting the PC. A typical 'business brain' would rather make more millions or billions from software than faff on with the added cost of a console. Microsoft messed up with Windows and Internet Explorer, now it's Xbox. Move on and continue with games on PC and PlayStation 5. Crack on with VR games and knock out some games for the Switch and Switch 2 in the future. Lastly, if Nintendo ditched consoles, the likes of Mario Kart and Zelda on PC and PlayStation 5 would obviously rake in more gold coins. The problem is, Nintendo doesn't have the best 'business brain' out there. There's plenty of mobile devices out there for handheld gaming, right down to tablets. How many games would Nintendo sell on Apple and Samsung devices? We all know the answer to that.

[VincentVanBro]

Go home Pachter you’re drunk

[SonOfOsiris]

Pachter = idiot

[cthulhucultist]

Has he ever being proven right? I sincerely cant recall a time where his predictions came true which is all you need to know about this "analyst"

[Stuart5756]

Let the brainwashing begin

[chaoslh]

Why does this guy still have a job? I want his job.