4 ms·

It would be incredibly stupid for MS to make CoD an xbox exclusive and completely misses the business case for buying Activision in the first place. Remember,

by xxpor 3y ago

It would be incredibly stupid for MS to make CoD an xbox exclusive and completely misses the business case for buying Activision in the first place. Remember, MS is in business to make money, not to win the console wars. Buying the CoD (etc) IP at an inflated price and then immediately cutting off more than half of the revenue would be so mind-boggingly stupid, almost to the point of malpractice. This is why they really don't even need to be forced into saying they'll maintain it for 10 years on PS. It's all about moving gaming to a recurring revenue model. So you don't care about if the consumer made a one time purchase of your console (in fact, you might even prefer they didn't if you're losing money on each one!), but you do care about the fact that they're playing your games. Ben Thompson put it better than I could: > Notice that this is for games that are purchased, and keep in mind that Microsoft’s goal with the Activision acquisition is not to gain exclusive games to sell but rather games to subscribe to. As I’ve argued the only way this acquisition makes sense is the extent to which it makes possible a new business model for gaming; simply buying exclusives via established titles like Call of Duty would be hugely value destructive. >What is notable about Microsoft’s subscription push is that it aligns the company’s Xbox division with Microsoft’s overall push towards cloud computing and subscription services. What is interesting to consider are two questions: >First, would Microsoft have ever gone down this path absent the investment in its original (failed) Xbox strategy? I would argue the answer is no; this is a reasonable leveraging of Xbox assets, but I do wonder if Microsoft could go back two decades if they would even bother. >Second, if regulators were to kill this deal (Microsoft still needs approval from the UK and the US) would Xbox be long for this world? It’s hard to see how the division makes sense if Microsoft has the current business model dictated to them, given just how dominant Sony is with said business model. https://stratechery.com/2023/uk-blocks-microsoft-activision-acquisition-microsoft-and-google-earnings/ https://stratechery.com/2023/uk-blocks-microsoft-activision-... (paywalled)

darknavi 3y ago
I totally agree. Xbox in the past 5-10 years really has been "Play our games where ever, just give us your money". I just don't really get the argument of "We won't do this for 10 years". OK, what about after that?
- xxpor 3y ago
  I don't know. I doubt MS, Sony, or the FTC know either. They probably have an idea, but who's to say if it right or wrong? It's really hard to predict markets out that far.
chaostheory 3y ago
Agreed. Selling exclusives would go against Nadella’s “Microsoft (makes money) everywhere” mantra Case in point: Sony PlayStation is one of Azure’s largest customers It’s strange for Nintendo not to see this
AlexandrB 3y ago
> It would be incredibly stupid for MS to make CoD an xbox exclusive and completely misses the business case for buying Activision in the first place. So why are Redfall and Starfield Xbox exclusives? Wouldn't they make more money by releasing them for Playstation too?
- xxpor 3y ago
  The economics are different: Redfall isn't a huge name, so it's more valuable for MS to get people into the game pass subscription than the comparatively piddly incremental one-time revenue they'd get from releasing it on PS5. CoD on the other hand is already a huge name, that releases every year (i.e. recurring revenue, even if it's not a subscription per se), and MS is paying a huge premium for it. Forcing people over to game pass in that case isn't worth taking the hit to reliable revenue you're virtually already guaranteed to get from PS owners. To be clear: I think it's less important to worry about this as less of a PC/Xbox exclusive than a Game Pass exclusive/available. I'd be willing to bet if Sony approached MS to bring Game Pass to PS, MS would be super willing to do it. Not that Sony would given their business model, but that's basically the point. It's not HW platform exclusivity, but store/subscription exclusivity.
  - AlexandrB 3y ago
    There's so much speculation about motives here. Neither you nor I have any idea what Microsoft's business strategy is. All I can judge them on is their actions. And their actions are buying up large publishers and making their most anticipated games exclusive to the Xbox. Sure Redfall was a somewhat minor release (and a mess), but what about Starfield? The game is hyped up to hell and now an Xbox exclusive as well.
    - maroonblazer 3y ago
      Minecraft proves the parent's point. Following your logic, Microsoft should've made Minecraft an exclusive. They didn't. In fact they're expanding the footprint, rolling it out to Chromebooks last month.
robertlagrant 3y ago
Non-"here's my theory as to why this would never happen" counterpoint: they bought Bethesda and made Starfield MS platforms-only.
- kevingadd 3y ago
  The following is personal opinion based on publicly available figures, IDK how accurate they are. Skyrim has supposedly sold around 60 million copies over the span of 12 years. Let's be generous and say those sold at an average of $60 each (probably less in practice due to sales, etc.) That's $3.6b USD in raw revenue. Pretty sick! On the other hand, as of 2022 (Skyrim numbers are 2023), Call of Duty as a franchise had generated over $31b USD in raw revenue. 10x that of Skyrim, Bethesda's biggest title. So in terms of scale, I don't see how making Starfield exclusive can possibly be on the same level as the idea of making the whole CoD franchise exclusive. Certainly it would be impactful but I can understand treating them differently.
  - NovaDudely 3y ago
    You don't just cut it off in a single go, Microsoft make their platforms more enticing. Heck they can do game companies used to and have timed exclusive releases. COD dropping on Xbox 2 months before anyone else. Microsoft are REALLY good at playing the long game.
  - robertlagrant 3y ago
    Thanks for the reasoning. My disagreement would be that you're comparing an installment with a franchise. The whole of the Elder Scrolls is bigger than Skyrim, although Skyrim was the biggest standalone seller. Elder Scrolls online has I think about 750k MAUs, at $10-$15/mo. And, I suppose more fundamentally, why would MS turn down a good chunk of $3.6b for the dev costs of making a Playstation version of Starfield?
    - johnnyanmac 3y ago
      >My disagreement would be that you're comparing an installment with a franchise. funny thing is that if you compared the last 15 years of COD to Elder scrolls, you're still comparing some dozen COD games to Skyrim and ESO. And I guess that one mobile game? 15 years ago is still a year after Oblivion launched.
majormajor 3y ago
If MS doesn't care about winning the console wars why don't they just stop making Xboxes entirely? Microsoft's subscription push can't work without winning the console wars since Sony isn't about to let them put GamePass on PS since that kills Sony's revenue model. (That would itself be a very interesting antitrust case.) So they still want to win the console wars, they just want to monetize that victory differently. But pulling things like Starfield - and eventually COD - off of other platforms is 10000% still aligned with "making as much money as possible."
- deleted 3y ago
  [deleted]
- doikor 3y ago
  Because they want to sell their games without paying a 30% cut to someone (Sony/Nintendo/Valve/Apple/Google/etc) if possible. Also getting the 30% cut from someone else selling on their platform is really nice.
- pjmlp 3y ago
  Because game studios prefer to target fix hardware like game consoles instead of the computer hardware jungle.
- johnnyanmac 3y ago
  >why don't they just stop making Xboxes entirely? because at this point, even if Xbox's weren't profitable, ending the Xbox brand would harm confidence in Gamepass. Not that Xbox isn't profitable. But even in the worst case they have negative incentive to pull out.
NovaDudely 3y ago
You don't just cut it off in one go, you squeeze them out slowly. Embrace the business (with money), extend the functionality (Xbox exclusive features), Extinguish the competition (drop support).

by xxpor 3y ago

darknavi 3y ago

I totally agree. Xbox in the past 5-10 years really has been "Play our games where ever, just give us your money". I just don't really get the argument of "We won't do this for 10 years". OK, what about after that?

xxpor 3y ago
I don't know. I doubt MS, Sony, or the FTC know either. They probably have an idea, but who's to say if it right or wrong? It's really hard to predict markets out that far.

chaostheory 3y ago

Agreed. Selling exclusives would go against Nadella’s “Microsoft (makes money) everywhere” mantra Case in point: Sony PlayStation is one of Azure’s largest customers It’s strange for Nintendo not to see this

AlexandrB 3y ago

> It would be incredibly stupid for MS to make CoD an xbox exclusive and completely misses the business case for buying Activision in the first place. So why are Redfall and Starfield Xbox exclusives? Wouldn't they make more money by releasing them for Playstation too?

xxpor 3y ago
The economics are different: Redfall isn't a huge name, so it's more valuable for MS to get people into the game pass subscription than the comparatively piddly incremental one-time revenue they'd get from releasing it on PS5. CoD on the other hand is already a huge name, that releases every year (i.e. recurring revenue, even if it's not a subscription per se), and MS is paying a huge premium for it. Forcing people over to game pass in that case isn't worth taking the hit to reliable revenue you're virtually already guaranteed to get from PS owners. To be clear: I think it's less important to worry about this as less of a PC/Xbox exclusive than a Game Pass exclusive/available. I'd be willing to bet if Sony approached MS to bring Game Pass to PS, MS would be super willing to do it. Not that Sony would given their business model, but that's basically the point. It's not HW platform exclusivity, but store/subscription exclusivity.
- AlexandrB 3y ago
  There's so much speculation about motives here. Neither you nor I have any idea what Microsoft's business strategy is. All I can judge them on is their actions. And their actions are buying up large publishers and making their most anticipated games exclusive to the Xbox. Sure Redfall was a somewhat minor release (and a mess), but what about Starfield? The game is hyped up to hell and now an Xbox exclusive as well.
  - maroonblazer 3y ago
    Minecraft proves the parent's point. Following your logic, Microsoft should've made Minecraft an exclusive. They didn't. In fact they're expanding the footprint, rolling it out to Chromebooks last month.

robertlagrant 3y ago

Non-"here's my theory as to why this would never happen" counterpoint: they bought Bethesda and made Starfield MS platforms-only.

kevingadd 3y ago
The following is personal opinion based on publicly available figures, IDK how accurate they are. Skyrim has supposedly sold around 60 million copies over the span of 12 years. Let's be generous and say those sold at an average of $60 each (probably less in practice due to sales, etc.) That's $3.6b USD in raw revenue. Pretty sick! On the other hand, as of 2022 (Skyrim numbers are 2023), Call of Duty as a franchise had generated over $31b USD in raw revenue. 10x that of Skyrim, Bethesda's biggest title. So in terms of scale, I don't see how making Starfield exclusive can possibly be on the same level as the idea of making the whole CoD franchise exclusive. Certainly it would be impactful but I can understand treating them differently.
- NovaDudely 3y ago
  You don't just cut it off in a single go, Microsoft make their platforms more enticing. Heck they can do game companies used to and have timed exclusive releases. COD dropping on Xbox 2 months before anyone else. Microsoft are REALLY good at playing the long game.
- robertlagrant 3y ago
  Thanks for the reasoning. My disagreement would be that you're comparing an installment with a franchise. The whole of the Elder Scrolls is bigger than Skyrim, although Skyrim was the biggest standalone seller. Elder Scrolls online has I think about 750k MAUs, at $10-$15/mo. And, I suppose more fundamentally, why would MS turn down a good chunk of $3.6b for the dev costs of making a Playstation version of Starfield?
  - johnnyanmac 3y ago
    >My disagreement would be that you're comparing an installment with a franchise. funny thing is that if you compared the last 15 years of COD to Elder scrolls, you're still comparing some dozen COD games to Skyrim and ESO. And I guess that one mobile game? 15 years ago is still a year after Oblivion launched.

majormajor 3y ago

If MS doesn't care about winning the console wars why don't they just stop making Xboxes entirely? Microsoft's subscription push can't work without winning the console wars since Sony isn't about to let them put GamePass on PS since that kills Sony's revenue model. (That would itself be a very interesting antitrust case.) So they still want to win the console wars, they just want to monetize that victory differently. But pulling things like Starfield - and eventually COD - off of other platforms is 10000% still aligned with "making as much money as possible."

deleted 3y ago
[deleted]
doikor 3y ago
Because they want to sell their games without paying a 30% cut to someone (Sony/Nintendo/Valve/Apple/Google/etc) if possible. Also getting the 30% cut from someone else selling on their platform is really nice.
pjmlp 3y ago
Because game studios prefer to target fix hardware like game consoles instead of the computer hardware jungle.
johnnyanmac 3y ago
>why don't they just stop making Xboxes entirely? because at this point, even if Xbox's weren't profitable, ending the Xbox brand would harm confidence in Gamepass. Not that Xbox isn't profitable. But even in the worst case they have negative incentive to pull out.

NovaDudely 3y ago

You don't just cut it off in one go, you squeeze them out slowly. Embrace the business (with money), extend the functionality (Xbox exclusive features), Extinguish the competition (drop support).