It's been a tumultuous time in Xbox land as of late, with news breaking throughout the week about job cuts - including four studio closures within Xbox's Bethesda division. At the time of writing Microsoft hasn't released a statement about all of these reports, but one former executive thinks he knows the "two reasons" behind these developer shutdowns.
Posting on LinkedIn, former Microsoft PR manager Brad Hilderbrand talked at length about what he believes to be the reasons behind this shock change in direction over at Xbox. The long-and-short of his post is that Hilderbrand thinks Xbox Game Pass and Activision Blizzard are those two reasons - with the ActiBlizz acquisition potentially complicating the team's Game Pass strategy.
Here's a chunk of Hilderbrand's lengthy LinkedIn post:
"So games like Hi-Fi Rush, which is incredible mind you, gets a very small bump in revenue from being the hot Game Pass game for a month, then it falls off a cliff when everyone moves onto the next thing. Poor Redfall had it even worse since it launched so rough, it never had a chance. This system was fine for a while when Game Pass was growing like gangbusters, but now it's slowed way down and the amount of revenue it's attributing to games isn't keeping up with the budgets to make them.
So far, the big bets on driving new subscriptions (Redfall, Starfield) haven't spurred near enough growth, and there's not much on the horizon that is likely to restart the momentum. The best bet is COD, but do you really risk the guaranteed sales revenue that franchise brings by putting it on Game Pass on Day 1 and potentially lose massive sales? I don't know what the plans are, but either you put it on Game Pass and lose money, or you don't and the subscribers revolt because they think that's what they signed up for."
The full post is well worth a read to get an interesting perspective on the matter - a perspective that's informed by someone who previously worked as a PR manager for the Redmond firm. We've already reported on news about Xbox potentially debating its future Game Pass strategy, so clearly, there are rumblings going on about what exactly Microsoft will do next with the subscription service.
What do you make of this explanation? Does it make sense to you? Tell us your opinions down below.
[source linkedin.com]
Comments 52
It would definitely be cool if they put some cod games on gamepass...but it's not like they have to day one on all the new ones...they could make a tier above gpass ultimate and have full access to all cod games and others for a bigger price increase...like a Gamepass premium...one above ultimate...idk ... whether Xbox puts cod on gpass or not I'll still support the devs that Xbox has under their umbrella. I hope others do the same. We need Xbox, Sony and Nintendo so we all have more choice and they have competition
Fully agree, damned if they do, damned if they don't with COD.
If they don't add it to Game Pass gamers will, quite rightly, call them out as even as recently as the business update a few months ago they restated that ALL their games would come to Game Pass Day 1. Of course there may be some slimy change e.g. only in Ultimate, or another tier that still lets this be true while moving the goalposts.
But if they do add it to Game Pass they aren't going to see a sudden huge upswing in console sales vs the competition mid-generation, and while they might see a few more Game Pass subs it likely won't move the needle enough. Overall they will lose money compared to how ABK ran it, and that is a large reason why ABK was worth almost $69 billion.
I don't see them putting the new CoD day one it would be stupid of them to loose 90% of their sales on Xbox.
As much as I have enjoyed the benefits of Game Pass, I can take it or leave it.
If Microsoft is realizing it can't grow Game Pass subscriptions and it can't afford to put all its first-party games on it as promised, then it's time to do away with it!
Price-hiking if Call of Duty drops on the service isn't the answer.
Most people who buy Call of Duty don't buy it for the campaign and move on (which is the real benefit to a Game Pass subscription), they buy it to play multiplayer for a whole year until the next one comes out.
It already costs less to buy the game outright (even with cost of Game Pass Core to play online) than to pay for a year of Game Puss Ultimate, so a price hike will do nothing more than make Game Pass Ultimate even less appealing to play Call of Duty.
Honestly, Microsoft would do best just to roll traditional Call of Duty multiplayer Modes/Maps into the Warzone and skip the annual COD releases.
Here is a bold idea. Do away with paid online all together!
How many people would move over to Xbox consoles and buy Xbox versions if they knew that they could play the latest Call of Duty WITHOUT the need for PS+ or Game Pass Core or any of that nonsense, but also don't need to buy an expensive and less-casual-friendly PC to get free online play?
I mean, it is what they promised...all first party day 1 on gamepass. And if you buy the whole industry, those are now first party, which means day 1 on gamepass. They are famous for backtracking though so who knows.
My guess when it comes to CoD on GP: they're going to thread the needle. Older CoD games will be on there, mayyybe last year's. Current ones will not.
People will get mad, but honestly: Xbox has kind of reneged on their promise of Day-1 AAA games already, due to the lack of those exclusives hitting the platform. We certainly aren't getting the "one a quarter" that was promised. This might help make the transition for subscribers easier.
Either way, all of this is a headache as Xbox put all its chips on both rapidly expanding and pushing GP.
@GamingFan4Lyf This right here. I let my GPU subscription lapse — like you, I was take it or leave it. I have a big backlog across all my systems, and often found myself playing games I owned on Xbox more than GP. Couple that with lack of free time and it just didn't make sense to keep it.
But I was bummed about missing out online play — the one thing of Gamepass I still really used. Then I got a Steamdeck.
I re-bought the Master Chief Collection for $10 and a few other Xbox Studios games for dirt cheap. And I can play them online for free on Steam. If MS found a way to make a similar offer on Xbox it'd be huge.
Then again, they're also the ones who introduced paying for online game to consoles, so it'd be quite a 180.....
@Krazee5255 yeah we need everyone at top tier. Competition is good. When it’s not look at madden 😂🤣 granted I play it every year, but only because there’s no other NFL sim game.
@GamingFan4Lyf I’ve been saying for a year or longer that if MS wants to grab a small number of PS owners back over to Xbox. Get rid of the online paywall. I know many that hate it. The CoD crowd would love to buy a $70 dollar game and not need a $60 or more purchase to play online with friends. Now it’s taking loads of money off the table for MS. But it depends on how aggressive you want to be to be a major platform in the industry. This move wouldn’t solve all issues over night. But it would be a move i think that would do wonders.
Re COD - isn’t there another way it could work with Gamepass? - eg
Older COD come to Gamepass
New COD costs £/$70 on Day 1 to those not on Gamepass
Those on Gamepass can buy it Day1 and get a 50% discount
After, say, 6 months the latest COD will be on Gamepass
It’s a tough one. GP has its place and its great value most months.
But even with day 1 things, even a well awaited day 1 huge Bethesda release, console exclusive, still didn’t shift the needle then MS must be looking at it and think what will?
Sure CoD may be ‘free’ on GP compared to £70 on PS, but casuals aren’t going to run out to buy a series X and GP, if they already own a PS. ( yes sure you can access CoD on whatever plays it, but they would ant like for like)
@EvenStephen7 I think it would be the right 180, though and long overdue. Besides, it only seems right that the one who started it should be the one who ends it!
I also think Cloud Saves should be free on PlayStation and Nintendo consoles because..let's face it...just about everywhere under the sun has Cloud Data at no cost.
@HonestHick It would be a start in the right direction in rebuilding good will with the community.
@EvenStephen7 make campaign for GP and MP paid 😅😅
All this GamePass discussion makes it clear why Diablo IV was the first ABK game added. They know how many copies sold on Xbox, so now they can estimate how many lost sales they potentially had due to some people just waiting til it came to gamepass.
So I guess if COD ain’t day 1, they can somewhat estimate how many people might just “hold out”
@GamingFan4Lyf I think they still have a catch 22 situation in no matter what they do, they will likely lose revenue. Which is what they are trying to grow right now. It's what all companies want dont get me wrong, it's just laid very bare with Xbox at the minute with recent events.
Get rid of the online paywall, lose GP subs that only use it because of that. People who play just COD buy one copy - less than 12 months sub - and that's that.
Put COD on day 1, lose money that the sale would bring.
Don't put it on and we all know those hardcore folks will be cancelling left right and centre. The droves of folks shouting 'pay your 70 dollars for COD, we get it for freeeeee' will be throwing toys left and right, as seen by the recent porting announcement.
Expecting folks to drop a digital collection on a competitor, buy a new console and game just to play online for free simply won't be a choice most make. Some will, but if all their pals are on the console they own, chances are they won't. The majority of money platforms get is from folks who don't frequent sites like this. They will simply pick up what's hot and their kids want.
MS is trying to bring in more cash through Xbox. They have got themselves in a corner where I suppose they just have to opt for whatever hits the financials the least. It's a grim choice either way.
They clearly don’t care about lost sales seeing as how they now port games to their competitors.
"Expecting folks to drop a digital collection on a competitor, buy a new console and game just to play online for free simply won't be a choice most make. Some will, but if all their pals are on the console they own, chances are they won't."
I mean, the vast majority of console buyers are the casuals who are only playing COD, FIFA, Madden, Fortnite, etc., so platform is a non-issue - it's more of a habitual purchase. Only about 20% of console owners are the "core" audience. And even less of that are people who comment on these pages.
And with cross-platform play being the norm, now, it really doesn't matter if all their friends are on PlayStation and you are on Xbox - you can still play with them!
"They will simply pick up what's hot and their kids want."
Ditching online service fees could be that thing that makes Xbox "hot".
But this is all just playground banter anyways. Since we don't have any idea what strategy Microsoft has with everything going on, it's tough to even tell what would even help.
I do know that price hikes and studio closures isn't the answer.
Saving consumers ~$50/yr on average might be, though. Sure, Microsoft loses that ~$50/yr for those who already pay, but it might entice people to actually play online more, buy games with an online component, and/or buy MTX knowing that they don't have to pay for online anymore. Do away with Game Pass completely is less money out the door keeping Game Pass alive.
Imagine being able to buy a cheap Series S, pay $70 for the latest Call of Duty, and that's it! That could be a huge boost in sales - well, until Sony inevitably has to also do away with PS+ requirement to try to draw people back (if it can afford to do so).
@VoidPunk It's like they are not satisfied with half a glass of water and are trying to make two full glasses out of it. No amount of pouring one into the other will do it.
Porting to PC was inevitable and I was all for that years before it happened. Porting to PS is untenable. I understand how they got there, but no. It creates the notion that any game could go over. Xbox is already missing too many 3rd party titles for that not further impact console sales, which is the reason you're porting in the first place.
@GamingFan4Lyf 'I do know that price hikes and studio closures isn't the answer.'
On this we 100% agree.
Like you say, we are just spit balling and I imagine (or at least hope) Xbox/MS pay people far better at making these choices than you or I. I just cant see a way out of it for them though.
Either way, I hope they find it. Sony needs a MS firing on all cylinders and vice versa. If one or the other drops out of the race the only folks that will suffer in the long run is us gamers.
@Weebleman "Either way, I hope they find it. Sony needs a MS firing on all cylinders and vice versa. If one or the other drops out of the race the only folks that will suffer in the long run is us gamers."
Absolutely. I want a strong gaming market, not a lopsided one (no matter what side has the significant upper hand).
These experts always have a posteriori analysis. I can't remember anyone telling these things during the ABK debacle years.
I think this is the kind of execs that work in these corporations. Always trying to interpret the current data, never having a vision, and wanting to risk money to make it possible. The only plan is making cash.
And that's good! for the marketing and sales deparment, at least. But, you also need the madmen, the dreamers, the storytellers in some key positions.
@GamingFan4Lyf totally agree on the free online bit. I would buy every online game on whatever console didnt charge for online play. Whoever does it first will have a great edge on competitors.
So basically what Eurogamer questioned yesterday about GP subscription service.
They have done another article today and it’s a long read.
What is the point of Xbox.
And an interesting summary below.
“The philosophy of a great video game platform holder is that it makes money in order to make more consoles and more games. The philosophy of Microsoft - and by dint of that, Xbox - is evidently that it only makes consoles and games in order to make money. ”
Got downvoted for this before but as good of a deal Game Pass is, it’s not good for the future development of single player titles. Games on the service don’t make money on a per sale basis, so they only care about install rates and hours played per game.
This means shorter single player games like Hi-Fi Rush and Ghostwire, or short co-op title like Redfall, will show much lower numbers.
Another big metric is the amount of new subscribers around the release of said games, but they barely marketed Hi-Fi Rush and its contemporaries. Most people outside of the XBOX sphere didn’t even know some of these games existed.
This is why they mainly care about games that have insane support prior to launch, like Starfield, or games where they can milk micro transactions or playtime down player’s throats. I’d bet that’s why Forza Horizon 5, Forza MotorSport, Halo Infinite, Sea of Thieves, and many more of their recent games have so many “live service” elements baked in.
There’s single player content coming that they’ve been developing for a while, like Avowed, Indiana Jones, and Gears… but I have a feeling they’ll slowly be shifting to only making live-service games over time, or single-player titles with a lot of live-service elements baked in that feel incomplete for many months.
Hopefully I’m wrong but things sure seem like they’re heading this way.
I'm no legal expert but isn't it an issue when you say all first party will be day n date, go on record to say CoD will be in gamepass day n date....and then don't put it in the service day n date? There's definitely a lawsuit coming and it's going to kill the brand. I can't see this actually happening, I'm expecting that the new CoD will be in gamepass and it's going to be announced in June as such.
But typical Xbox, horrible communication resulting in negative speculation and rumours that will run rampant and further erode the brand until June.
I'm definitely not buying anything on the platform until i see what their actual plans are. Have gamepass for over 2.5 year's stacked so I'll ride it out until then and make a decision on where to spend my money when I have to spend it next.
@Krzzystuff saying something isn’t law. Unless it’s signed on a contract somewhere there’s not much you can do about it.
MS would argue that the situation has changed etc etv
Xbox has put itself in a lose lose situation in my opinion. Consoles don't make money and in any case they're likely to fall even further behind their competition after these latest developments. I can't fathom Microsoft's aims or business plan at this point. Going straight up publisher has seemed obvious for a while but they've created all this negative publicity for themselves and likely resentment that could damage sales of both hardware and software. It's all rather baffling. You'd think a trillion dollar company would employ smarter people but everything seems geared toward quick returns with no regard for sustainability.
I love GP but if the result of me enjoying it is studios being close that would make content for it then I'm fine just doing away with it or at least not putting AAA exclusives on day one. For COD I would put all the games on GP except for the current years iteration, give it a year to get sales before adding it to the service.
@PsBoxSwitchOwner saying something to sell a product and it not being true is against the law however. That would be the FTC's wet dream if they actually did that.
I'm really over it at this stage it's bad but read the real news get perspective!
What I think they need is 1st party smaller games filling out GP while we wait for the AAA game near Xmas.
With COD, I think it will be 50/50, they loose sales on Xbox due to GP, but make those sales on the PlayStation side.
It’s such an easy solution in my opinion. Put all the older COD on Game Pass immediately. New COD games get added at the 6 month mark. You are adding older COD for people on Game Pass and still making a lot of revenue off of new COD game sales by keeping new releases off of Game Pass until the 6 month mark. It’s a middle ground that services both sides and I guarantee that will still make MS a ton of money with COD given how well it sells on other platforms. Win win…
And in all honesty, I don’t need day 1 games on Game Pass. If the model is struggling due to putting expensive AAA on the service day 1, then don’t. Keep day 1 for AA and indies and bring on AAA at the 6 month mark. I would be totally fine with that.
@OldGamer999
That’s such a naive article. Here is the original quote:
“The philosophy of a great video game platform holder is that it makes money in order to make more consoles and more games. The philosophy of Microsoft - and by dint of that, Xbox - is evidently that it only makes consoles and games in order to make money. ”
Here is how it should read:
“The philosophy of a great video game platform holder is that it makes money in order to make more consoles and more games, in order to make even more money. The philosophy of Microsoft - and by dint of that, Xbox - is evidently that it only makes consoles and games in order to make money, so really no difference between the two”
Sony isn’t making money just so it can keep making great games for the sake of making games. They are making games to make money, period. Same can be said of Nintendo. They are making games to make money so they can make even more money on more games and hardware…. None of these companies are making video games because it makes them feel all warm and fuzzy inside. The bottom line is money. That’s as true for Xbox as it is with PlayStation as it is for The Switch, and whatever comes next.
That original quote is one of the most singularly biased quotes I have heard in gaming in a LONG LONG time.
It's a pretty problem. They've been selling the whole Xbox platform since Series based around Game Pass, and have been selling Game Pass based around day 1 first party. They largely even sold support of the ABK merger based around CoD on Game Pass, even while Kotick said he hated Game Pass.
So if they put CoD on game pass they just threw money away, and most of the point of buying ABK to begin with other than King. If they don't put CoD on Game Pass they've broken support of Game Pass because now nobody knows what they're paying for "mostly all first party games maybe sometimes except when it isn't."
If they raise prices of Game Pass again, just for CoD which won't even appeal to most current GP customers, they'll lose a lot of subs.
And if they kill GP or kill Day 1 on GP, which has been their main sales pitch for Xbox, what are they going to try to sell the Xbox platform on when most other features have been ignored behind GP. What is their reason to potential new console buyers to buy an Xbox over a much more popular PS5, while they're also selling their own games on PS5, also with unclear messaging as to when or if what games will do so.
Meanwhile the sold point of Game Pass was around the variety of games, games like Hifi Rush, explicitly games like Hifi Rush, that don't have to be big blockbuster sales because the costs are shared across subscribers. But now they're killing that to focus only on the very big blockbusters that don't actually fit as well into the model for Game Pass.
They don't really have an out that isn't going to lose a lot of customers. And they didn't have enough customers to begin with.
@EvenStephen7 Xbox has left me with very little faith over the past almost year.
I've simply just started buying it for the SteamDeck instead.
I will not invest in Xbox any further, at least not until they explain, with credibility, just what the heck is going on
@Feffster It's 100% damned if they do AND if they don't.
I don't think they can put older CODs, it will eat up new COD sales. BLOPS2 was a best seller for awhile, and had attracted quite a community again.
You make a popular older COD free on GP and blow up the community with GP members, Warzone is free as well with newer COD features..... why spend 70-100
@TJ81 "everything seems geared toward quick returns with no regard for sustainability."
That's it right there, that's the modern business culture entirely. IDK what changed from the era of "cost + margin" and sustainable business, to "maximize the quarter, figure out next quarter next quarter, if it doesn't add up just sell real estate until it does." Something is really broken in modern business. It's not just Microsoft, they're just the richest example. It's expected that everything is simply about getting the biggest possible number for any given quarter and everything else is secondary, you just liquidate and move to the next company. Better yet, buy a company, move all your debt into it, then have it file bankruptcy and liquidate it.
I don't see them just going publisher though. I do see them selling hardware, and I do see them merging PC and console together which takes most risk out of it. I just don't see MS as a company willing to give up platform control and developer tools in any area they can retain that. Yet at the same time they're sabotaging every chance of success as a platform. My expectations are they hold onto owning the platform indefinitely, they sell hardware, maybe expensive hardware based on Phil's hints, they merge it with PC internally so that there's no special development cost, and so it's easier to roll out on cloud (though they appear to have abandoned cloud quietly), but they also don't promote it. Like Surface., It's just kind of "there" and whatever sales it gets it gets. It's not a priority, and they're not competing against Sony and Nintendo. It doesn't influence the market at all anymore. It's just there. And it may actually be an excellent platform, but it's kind of just ignored. I think that's the future of "Xbox." Technically it may not even be a bad future. A forgotten decent little budget gaming PC with a semi-closed storefront isn't a bad thing in and of itself. If it actually conveys a clear message about what it is, isn't changing policies and strategies daily, and isn't at risk of just being discontinued on a whim. Big if.
@Vipor007 Maybe something like Hifi Rush 2?
@CallMeDuraSouka
“… why spend 70-100.”
Because that’s what COD gamers do. They don’t play the older titles when a new one just released because they already played the older title. They want something new. I have a couple buddies that are huge COD players and the idea of not buying a new release is absurd to them. It wouldn’t matter if every single COD ever made was available for free on Game Pass. They would still be buying the new one day 1.
That’s not to say that having a bunch of COD on Game Pass isn’t going to affect new sales at all, but it’s not going to cause a significant decline. COD players want new games and most will absolutely buy a new release over playing an older game they have already played.
@RIghteousNixon It's not as easy as you make it sound though. Out with putting the new CoD on game pass day one and not raising sub prices anything they do is going to be a PR disaster at a time when trust in the Xbox brand is at an all time low. They have marketed game pass on a promise they all fist party games would be on game pass day one. This includes CoD, Phil Spencer even reiterated that point just a few months ago. They also stated numerous times during the ABK saga that game pass prices wouldn't increase as a result of the acquisition. If they don't stick to both of these statements then there is going to be an element of the fan base that isn't happy. Whatever they decide to do they are going to have to be very careful how they communicate it to try and limit the damage done.
@NEStalgia I'd be pleased to see a 'high end' console equitable to a decent PC but it has to be somewhat future proof and that is also an emerging question mark hanging over future hardware with large games now requiring 5-8 years to develop (maybe AI can help but let's not go there for now). How about something somewhat modular, a high end CPU with options to upgrade the storage, GPU and RAM - that could potentially enable the hardware to transcend two generations of gaming evolution. Wishful thinking maybe but one can dream! I'd also like it to have the Steam storefront but maybe I'm losing my grip on reality at this point.
@Kevw2006 Not to mention if they actually do raise prices on account of CoD, FTC probably could drag them back into court. Even if they have no chance of losing it's another spectacle they probably don't want. Especially getting into the AI era when they're going to have even worse government battles ahead. They may not even be able to raise the price though they'll probably do something worse instead. Plus wasn't the recent price increase enough for the ABK titles?
@TJ81 I don't think it can be modular. I think that's where Steam went wrong with the Steam Box. Once you get into modular, you get right back into the reasons PC hardware is expensive, and at that point all you have is a normal PC so there's no reason to sell something special. I do think the next Xboxes will basically be a custom built gaming laptop with "normal" off the shelf PC parts and normal Windows inside, but at reduced cost and better efficiency by being able to be a monolithic build with some custom parts (i.e being able to skip the modular bridges of a normal PC and have everything directly integrated) but it still can't be modular, that would defeat the point. And heck, even laptops are barely modular. Basically a much bigger more powerful Steamdeck type design in a full sized/powered format, and maybe the same for the handled more like an actual Steamdeck. True, games take 5-8 years, but they SHOULD take 5-8 hears for whatever hardware it targeted originally and not evolve with the current latest hardware....of course the latter is what most devs seem to do these days. If we can put a tiny PC in a handheld there's really no more reason not to put a big PC in a console, and a lot of benefits. But it still needs to not be $3000 for a 4k box. Sadly if they'd kept the consoles 1080p last gen and this gen, they could have gone all PC for pennies, but now they set expectations.
@NEStalgia I'd be happy with 1440p but many of us would use this potential PC Xbox hybrid in a living room or bedroom, likely with a TV 55" or larger which means a stretched image. Somewhat related - I'm fairly clueless when it comes to all this fancy new upscaling technology but perhaps that could be leveraged to have games look closer to 4K even if they aren't technically.
It needs to be on gamepass day 1. Let the ps5 and soon to be added switch 2 editions carry it saleswise while cod carries gamepass.
I already have the Call of Duty games I wanted play. The most recent being WWII. I'm not likely to pick up another CoD title unless it's Infinite Warfare 2, which I don't think they'll make. It's a shame because Infinite was a great FPS, under any other name this would have been adored but as a CoD title it never stood a chance.
@TJ81 The fancy upscaling is exactly what the rumored PS5 Pro is going to use. And it's heavily rumord switch 2 which is already Nvidia will use DLSS for that. So the Xbox PC would definitely be using to too!
@Krazee5255 Current Game Pass Ultimate becomes "Penultimate." A new Game Pass Ultimate tier is installed with CoD (3-day early access) and a higher price. Thirty-five dollar package with battle pass, coins, weapons, skins, and 5-day early access. Sell the $35 package on all platforms.
@OldGamer999 That quote is silly — all the platform holders are doing it for money. They are not artist.
@CallMeDuraSouka Same but I’m going with a Rog Ally since I have some games on Epic and MS Store (through Play Anywhere) and I don’t want to rebuild my library from scratch.
@RIghteousNixon Fortunately for you, you haven't read EG much. I stopped years ago when they stopped talking about video games.
I don't think cod should be added to game pass on day one. Or any of Activision games, day one. I think they should treat activision as a separate entity. Something they own, but not the same as xbox games. Maybe I'm just weird for thinking this. But I think Activision games should be added to gamepass 2 or 3 months after release.
@theduckofdeath Yes. It's, actually, Nintendo who has been the greediest lately, with full-priced same-generation ports, poorly built joycons and no software cross-buy or upgrade when killing Wii U but yes, the three of them are in the business for money. Microsoft, Nintendo and Sony. That article is nonsense.
@themightyant
MIcrosoft 100% can add new CODs day one. They will still get the PC, PS5 and Switch sales of it. Plus it would cause gamepass subscriptions to rise
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