Microsoft Reveals New Xbox Game Pass Stats And Explains How It's Different From Netflix

Game Pass subscribers play more games, in more genres, and spend more money overall, Microsoft says.

[RazzerRedux]

"Bond said Game Pass users:

Spend 20% more time playing games
Play 30% more games
Play 40% more genres
Spend 20% more money on gaming overall"

So most Game Pass subscribers end up paying more money on gaming than non-Game Pass subscribers? Am I reading that right?

[Orchard]

That's how I read it - and I see it in myself somewhat to be honest, when I get the game for 'free', I'm more likely to buy cosmetics or DLC packs etc. More so than if I already shelled out $60-70 for the base game - and a lot of that $60 doesn't even go to the developer, when compared to DLC/cosmetics.

p.s. I love your article summaries!

[Hedstrom]

I myself have a hard time seeing it. I would never buy DLC or Cosmetics to a game that could disapear the next month. I just dont get it!

[vallencer]

@hedstrom

For me I will buy dlc and cosmetics for games that microsoft owns because they won't be going anywhere. But for sure the others that can come and go I usually won't.

[Lore]

Doesn’t the 30% revenue share that goes to the platform holder also account for any dlc/mtx purchases?

[enkiduxiv]

And..... that's exactly why I hate Game Pass. It's there to condition the consumer to buy microtransactions. Now, let's all sit back and watch Microsoft ruin every Obsidian, InXile and Bethesda RPG with Live Service nonsense.

At least we still have BioWar... oh, I made myself sad.

[thesoftware730]

@ Orchard
I think that was her point exactly.

I don't think people realize how much money people spend on DLC and MT.

5million people spending $2 is doubling.

Another possibility come, when/if someone plays a game and then a sequel releases, they most likely wont wait for it to come to GP and just buy it...so it can create new customers.

@Hedstrom
I do not think it works that way, if you download a game off GP, you can still play it even if it leaves GP, and I'm almost positive that you can redownload it from your game library. So you wouldn't loos your DLC.

[IRetrouk]

@The software,
Once a game leaves gamepass you cannot play or download it again unless you buy it or it comes back to gamepass. Dlc and save games are safe, but you do lose access to any games that leave the service.

[RazzerRedux]

@thesoftware730

IRetrouk is correct. When a game leaves GP, you lose all access to the game and the DLC purchased it useless unless you buy the game.

[thesoftware730]

@ Razzer and IR,

Oh, my bad, I did not look it up.

I never ran into this issue so far, I misspoke.

[IRetrouk]

It's all good dude, was just letting ya know👍

[crazyCoconuts]

So, since GamePass customers are paying more as it stands, maybe MS won't have to increase prices or force you to have Ultimate to get the premium games? I've been expecting 1 of those 2 things to happen. #2 has already begun...

[Zhipp]

If gamepass owners are already paying more money, there isn't really any need to increase gamepass prices.

[Atom666]

I think that's right. I also think this helps profile the demographics of users more than anything.

Your "hardcore" gamers are probably more likely to see the benefits of the program in the first place. Those gamers will spend more money (and time) on the hobby generally.

For a more casual gamer, maybe they pick up a system for COD or something, grab a used game here or there, but don't play that often. They're probably not going to see much benefit to a GP sub, and they don't spend that much to begin with.

This is still probably attractive info for 3rd parties though. I think that's Bond's role in the company.

[Orchard]

@crazyCoconuts

"maybe MS won't have to increase prices or force you to have Ultimate to get the premium games? I've been expecting 1 of those 2 things to happen. #2 has already begun..."

I must've missed something, which premium games do Ultimate subscribers get over normal subscribers? EA Play? I'd assume thats just because it's a subscription to a 3rd party service. Zenimax for example is included in the non-Ultimate sub.

[darthv72]

I know I have certainly spent more time playing games / genres that i didn't think would interest me. And I have also bought more games after having played them in GP.

[Zeref]

It makes sense, you get to play a lot more games therefore the chance that you find something you really like is higher. And then you end up buying it.

Also if you didn't pay for the base game there's a bigger chance you'll buy DLC for a game you discovered

[gamer7804]

Of course, I’m guessing gamespass members are more avid gamers than regular gold members whom might pay to play just fifa madden or call of duty. Probably play a more variety of games

[spwittbold]

This could be taken in multiple ways.
It could also mean than GamePass subscribers are more likely to make "In Game Content Purchases," such as DLC - because alot of GamePass games only include the base game and if one wants to play the extra content has to make the additional purchase.

[TheGreatGazoo30]

Makes sense to me. I've played more games than ever since GamePass and play games I'd never have given a second look before too. If I love the game, happy to buy dlc for it later.

[Sciurus_vulgaris]

“Whales”, the people who buy MTs heavily maybe attracted to Gamepass. To “Whales” Gamepass it’s just another thing to spend money on related to gaming.

[Tetsdah]

Not to be a downer, but what are the bases from these percentages. Knowing numbers would be helpful to make the percentage increases make more sense. We don't know concurrent users, so what are they playing 30% more than. Are they saying 18 million users are playing 30% more games? If that is the case, wouldn't the gp games decorate their most played.

This is a vague metric without solid numbers. But congrats MS if these percentages are so successful

[Dark-soul]

Some people play maybe 2-3 games a year and thats it, on xbox pass you would spend maybe a bit more per year , but play hundreds of games instead, i was blow away how cool game pass is and i am old playstation fan, but now i have both consoles and very happy

[RazzerRedux]

Hundreds? I think you are confusing "playing" with having "access to" those games. There is no way you are playing to completion hundreds of games a year with or without game pass.

Glad you are happy with it though. I have access to Game Pass on PC and there just hasn't been much there that interests me as it is primarily indie and older third party. Hopefully this will change when Microsoft first party kicks into high gear.

[Magog]

Makes sense. Hardcore gamers who see value in gamepass have always spent more. People without the time to play a large rotating selection of games aren't the kind of people to sub to gamepass.

[PowerControls]

So where's the profit? Game Pass subscribers spend 20% more time playing games, which costs them 20% more money ;-)

[CYALTR]

I really don't understand the obsession with MS profit margins. They will be just fine even if they use this as a loss leader to get people into the MS microsystem. MS has plenty of money from many different streams. They are a large diversified company, so all of this concern over how they are going to make money is completely irrelevant. If you like what GamePass provides to you and think it is worth the money, you should get it. I fall in that camp. If you think the games are weak, think it is a gateway to MT's, etc., by all means, don't subscribe. It is your choice. Choice is good.

[PowerControls]

@CYALTR I was referring to subscribers' profits, not Microsoft's. If I spend 20% more money on games, I assume I will play 20% more. I don't need a GamePass to do this :-)

[roadkillers]

Gamepass got me to buy RE8+RE7 dualpack.

[Smok91]

Ever heard of microtransactions? Lmao

[RazzerRedux]

yeah, but seems silly to spend money on MTs for games you don't own. If a game comes off Game Pass you lose all that DLC unless you buy the game outright. Defeats the purpose of Game Pass to me, but I guess people will do what they will with their money no matter how stupid it is.

[alb1899]

Is easy to understand. There is more opportunities to try different games and genres so you play more and as you play more there's more chances that you buy in game things and if you liked so much a game you buy it too.
Gamepass is the best that has happened to me in videogames and I am paying the full price happy.

[fei-hung]

We don't know what these figures are without context. Phil and MS are really good at this.

The $180mil revenue a month means nothing if we don't know if it is profit loss or break even.

20% more money on gaming overall, how would they know this? Do they know how much these people spend on other systems? What if someone only paid COD so only spent £50 a year, but since they got gamepass they are fall I to the 20% more spend now.

The 20% extra, where does it go? Devs? MS?

How does the 20% breakdown into sales loss/win ratio for full game sales they've lost?

I haven't got a Series S or X yet. Hoping to have one by the end of the year. If I get one I will be one of those who only buy a gamepass nothing else. Will I fall into that 20%?

If someone buys a pre-owned game, does that count as spend or no spend.

Or is it a simple case of the gamepass and microtransactions make up the 20%?

[RazzerRedux]

All good questions.

[XiNatsuDragnel]

So you pay more money into games with gamepass well it helps it's good.

[Mr Pumblechook]

Xbox says Xbox Game Pass subscribers ‘Spend 20% more money on gaming overall’. This sounds amazing but it needs to be defined. Does it mean XGP subscribers spend 20% more than people who own an Xbox but don’t have a subscription? The thing is people without a sub are normally casual gamers who are less likely to spend. But another article suggest this spending is on DLC, so perhaps XGP subscribers spend more time online so spend more on DLC. But the question is do they spend on new games more or less?

[waverider]

The biggest diference is that Netflix got almost 200 millions subscribers and none pays one buck to get the service..... Even so they are billions in debts. Its just math. They can spin it in any way they want. Comeback when you got 200 miliions subscribers..And again the old talk about billions of players... No they arent billions of players, but they are billions that watch movies and series.

[King_Noctis]

But MS is not in debt, and they are making profit with Gamepass.

“ Xbox Series X/S launch and Game Pass push Microsoft’s quarterly gaming revenue past $5 billion”

https://www.geekwire.com/20...

[waverider]

There is a huge diference between revenue and profit.

Xbox content and services revenue increased to $3.5 billion, up 40%, driven by growth in third-party titles, Xbox Game Pass subscriptions, and first-party titles.

[Orchard]

"The biggest diference is that Netflix got almost 200 millions subscribers and none pays one buck to get the service"

Err, in the early Netflix days they were giving away free trials constantly and cheap entry level pricing... that's how you get people into new services. Now people are happily paying $10-20 for Netflix.

They may not have 200 million subs, but 18 mil in 3 years is a pretty good number. PSNow got 2.2 mil in 7 years.

Also, Xbox/MS/Gamepass isn't in debt - where are you getting that info?

[waverider]

Do you think that games on gamepass are free? you think that 3rd party studios put there the games for free? Wait, Microsoft call the studio and say «can we make money with your games for free? Thanks».

Because Microsoft already told they arent making profit https://wccftech.com/micros...

Of course psnow got 2.2, Sony doesnt put first party titles day one on any service. because they sell millions and they make much more money then Microsoft, because their market share is double the size.

[mcstorm]

@waverider i see someone gets a little to excited when numbers are announced.

[Orchard]

"Do you think that games on gamepass are free? you think that 3rd party studios put there the games for free?"

Are movies & TV shows free? Nope, but somehow Netflix is still in business (unlike Blockbuster) and bigger than ever.

The 2.2m number is on Sony, if they want to get serious about subscriptions they can do things to drive those numbers up (e.g. putting 1st party games in the sub). Subscriptions are typically substantially higher profit margin products than physical game sales, you buy the game at $60 but a lot of that goes to other companies/costs.

[EasilyTheBest]

Waverider, "Because Microsoft already told they arent making profit"
That link you provided was from July last year! Plus the article even explains Microsoft long term plan of building up the service.
Gamepass really seems to get to you. If you don't like it just go & buy your games as you can still do that on an Xbox.

[RazzerRedux]

"Subscriptions are typically substantially higher profit margin products than physical game sales"

And that statement is based on......what?

[darthv72]

@best... it's anything MS related that gets to him. There are quite a few on this site who get bent out of shape at any sort of positivity towards MS and Xbox.

[Orchard]

@Razzer I'm basing it on past experience. I've worked at companies that have launched subscription services for their entertainment products. The profitability on subscriptions is very high, typically 80-95%, even more so for users who subscribe and don't play/watch much. Typically the high activity users who consume a lot of content are your more expensive users, likely even negative profitability, but the majority of users end up consuming little enough amounts that they're highly profitable as users.

Shipping physical games, you sell them at $60 in Walmart or wherever, but really, <= 50% of that arrives at your company by the time the platform holder, disk manufacturers, stores, shippers etc. take their cut. Digital is a bit higher, but some costs are unavoidable (e.g. platform holder costs).

That being said, I don't have any particular insight into the numbers / financial operations of PSNow and Game Pass.

[FanboysKiller]

@waverider
You can cancel the subscription service any time you want dah , much better than giving you just 2 hrs for checking to decide, feels like making a rush decision with steam .

[enkiduxiv]

By what metric is 18 million in 3 years a good number. If Game Pass basically "gives away" the vast majority of games for "free" you would think it would have many more subscribers at this point. Nintendo has sold its platform (i.e. the Switch) for 300 dollars a pop for a little over 3 years now and they have shipped 80 million units. Nintendo isn't giving away anything, so why are people adopting it so much faster?

[Orchard]

@enkiduxiv You obviously have to compare comparable things, you can't compare physical hardware vs a service, not to mention physical hardware which is heavily established vs a new service...

Realistically you can only compare XCloud/GP to PSNow, Google Stadia, Amazon Luna and GeForce Now - and MS is leading the pack there in terms of subscribers. 18 million subscriptions in 3 years for a brand new service, and a service type that consumers aren't used to yet, is great.

[darthv72]

you do know Netflix still offers free trials to new potential members and those who havent used the service in a while right... right?

[waverider]

you do know that gamers used the 1 buck deal to get years of gamepass? Right? one year 12 bucks! Better hope that of 18 mllions they are 5% and not 70%. Better hope that those 18 millions are active players and not players that had gamepass sometime... Its easy to play with numbers. You now that right?

[Orchard]

@waverider And people did that on Netflix back in the day... some people still do constant trials today or account share... Netflix isn't exactly struggling.

[Kerppamaister]

@waverider you clearly have no grasp of the pricing. Nobody gets it at that price. And MS has said "active subscribers". If you don't understand what that means there's no point trying to argue with you. Actually, there is no point in arguing with you, period. You sound like a hater.

[343_Guilty_Spark]

@Waverider

I'm one of those $1 gamers (technically it was around $120 because I converted 3 years of Gold at an average of $40/yearly pass)...got it to 2022. And guess what I'll be doing when my 3 years are up...

I'll be subscribing at $15, because the service has proven it is good enough to keep.

Can't wait for all the EA play games to drop.

Clarifying again because I see this a lot.

You have to buy Gold then convert for $1. You don't just get GP Ultimate for $1.

[DiRtY]

Having 18 million active subscribers is quite something already. That’s like 2 billion USD per year.

I think they can grow that number to 45 million in 2023. Once Starfield, Halo, Age of Empires, Forza Horizon or Perfect Dark drops, the growth will be quite massive.

[DJStotty]

@waverider

"you do know that gamers used the 1 buck deal to get years of gamepass? Right?"

You can only use the 1 buck deal once per account (1st month new sub), i think you are meaning the direct transfer of xbox live gold when you sign up for $1 to get years of gamepass, whereas the xbox gamer is still paying microsoft for xbox live gold, so they are making more than the $1 you claim.

I took the offer of transfer to Ultimate for £1 (UK) and it is for the transfer of Gold to Gamepass Ultimate, not ordinary Gamepass, i am paid up until October 2021, where then i can either a) pay the monthly fee, b) buy more gold and try and do the transfer again

Essentially even if you do the transfer you are still paying $60/year for Ultimate, you can not keep using the $1 offer over and over, but you can still transfer gold>Ultimate

[RazzerRedux]

@DJStotty

"You can only use the 1 buck deal once per account (1st month new sub)"

Factually untrue. I and others have used the $1 "first month" deal on multiple occasions. All you have to do is allow the subscription to expire and then renew.

I do not expect this to last, but I don't think Microsoft really cares at this point. They want subscribers more than they want revenue.

[343_Guilty_Spark]

@RazzerRedux

So you're buying Gold and converting it for $1?

[RazzerRedux]

@343_Guilty_Spark

No. I have been able to use the "first month of Xbox Game Pass for $1" multiple times. Microsoft is not enforcing this as a one-time only deal at the moment. As long as you let the subscription expire and come back in a day or two to subscribe again, it will allow you to pay $1 again.

This is the PC version so I can't speak to Xbox Game Pass for console.

Edit:

This was reported as a bug last year by some, but it has never been fixed.

https://answers.microsoft.c...

[darthv72]

@razzer, that is an interesting bug to have. Sadly I dont use GP for PC (although I think Im allowed to because I have GPU).

I generally turn my searching points into currency to buy the 3 month subs. Gotta love that Bing search perks.

[IRetrouk]

Razzer is 1000000% right, both me and my wife have done this multiple times, its not just the 1 pound for one month deal either, they throw the 3 month deal at you multiple times too, all you do is unsub for a week or so, this is the console version I'm talking about too, not the pc version, the "bug" is in gamepass full stop...

Also not once did nadella or anyone from ms say that the 18 mill gamepass users were "active users" don't know where you lot get this stuff from.

[chiefJohn117]

I have Netflix and spent 0$ on it. I have GP and spent over $100 on it. Stay salty my man

[CYALTR]

@waverunner

You do know that millions of people use Netflix every day for free. Password sharing runs rampant and has since the beginning. It's not that they are unaware of this, it is just not worth it to them to rock the boat. Now, after 20 years they are starting to make a little noise about cracking down on this.

My point is, it is not that companies are not aware of these workarounds, it's just that the vast majority of people just won't bother. It's really not worth it to piss off the small number of people who do this, but they have done the math. Gamepass is really aimed more at the causal gamer anyway, those who aren't willing to go through the hassle of jumping through hoops to save $14/mo. Gamepass is a mass market play, and at the growth rate it is seeing, it is working.

[FanboysKiller]

It breaks the doubts barrier of uncertainty for buying good or bad stuff, it's expected to give better results.

[Knightofelemia]

I'll just stick with physical

[Rousseau888]

Dinosaur era 🦖

[gold_drake]

true but imagine internet is out ... whos laughin then? if u havent downloaded the games.

[RCslayer]

All goes towards killing physical gaming and in turn used gaming markets.

[NeoGamer232]

While I don't want to to see the physical new game market disappear, I think that consumers and retails brought it on themselves.

Publishers and developers warned gamers for years that if you don't buy new physical games developers would go bankrupt or be shutdown. This past two generations there have been many instances of perfectly viable developer going bankrupt or shutdown simply because one of their games did not perform well in sales even though the games deserved to sell to at least a break even point. Yet, gamers and retailers like Gamestop ignored the publishers and developers. Gamers increasingly bough used games rather then new ones and Gamestop never gave a cent of profits to the publishers and developers for used games. So now people are crying fowl because they can't deny publishers and developers duly earned profits from their games that they made and created for our entertainment.

Like I said, I am disappointed physical sales are bricking, but if people would've listen to and support publishers and developers we might not have gotten here.

[plmkoh]

The used game market was 100% never the problem, it was gaslighting by the publishers to push you towards games as a service and DLC.

[MadLad]

Outside of those who just need that physical copy, and have that case on a shelf somewhere, it still results in cheaper gaming experiences for the consumer.

Not to mention the money spent still directly benefits the developer/publisher.
Unlike the used game market.

[P_Bomb]

@neo
Used market can be a gateway to other games, subs and services. Similar to the buck a month argument I’ve seen.

Rentals didn’t kill movies. Yes the studios tried to block Blockbuster etc, but they lost in court.

[OneLove]

Physical gaming is dying with time idiot. No other factor is apart of that. You can literally see the digital age booming with corona and every restaurant having an app now.

[RosweeSon]

Ones films ones games it’s hardly rocket science 🤣

[DeadManMMX]

I see a lot of people jumping into the it’s DLC/MT headspace. What about those that simply enjoy a game and buy it. The last game I bought that was in GamePass was Vampyr because I was more then halfway through and enjoying it was discounted at like 14.99 the week it left.

[gold_drake]

"spend 20% more on gaming overall" ?

im confused. i think they are too ha.

[Wikkid666]

It's common sense.... the more people play games, the more likely they are to spend. It could be on microtransactions, dlc, out right buying the game they discovered on gp, etc.

[spambot0815]

company perspective:

spend 20% less on software
pay 30% less to employees
pay 40% less taxes
spend 20% less on hardware

🤣

[YourMommySpoils]

Tomorrow it will be branded Xilften