Games
Welcome to the largest gaming community on Lemmy! Discussion for all kinds of games. Video games, tabletop games, card games etc.
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The thing about this shit is...
Microsoft, like Google, is now a user-data driven company and they have already made loss/profit ratio analysis on this long before they released the price increase. They're absolutely banking on people cancelling but making up the difference and then some from the people who stay.
For a thought experiment let's consider how many subscribers they were reported to have in Feburary: 34 million. Let's assume that everyone is paying for the highest tier to make the math easier. So current income would be 34 million user x $20 a month and thats $680 million a month. New income of 34 million users x $30 a month is $1.02 billion. The difference is $340 million a month. Let's divide that by $30 a month. That gets us about 11,333,333 users. So they can hemorrhage over 11 million users and still break even. To make sure, let's subtract 11 million users. That gives us 23 million users. 23 million users x $30 a month is $690 million a month, a cool $10 million a month above current profits.
For final context, 11 million users is roughly 32% of their entire subscriber count. They can afford to lose a third of the people subscribing and still make money.
The math doesn't bode well for us who vote with our wallets.
One could imagine that conveniently, Microsoft's online support pages and the amount of support staff were designed to only handle hundreds of thousands of cancelations at a time.
And it gets even better. Instead of up to 33% leaving, say 50% of that group convert to Premium instead of Ultimate. That isn’t any lost revenue since the price is going up to what Ultimate used to be. So that cushions their numbers even more.
I'm not a licensed math surgeon, but I think your math is wildly optimistic in favor of Microsoft due to how the subscription totals are actually distributed per price tier.
I don't doubt that they did a lot of math to figure out an acceptable level of churn for this change, I just don't think it's nearly as generous and wide as you're calculating.
There probably is a very real churn limit that they're trying to avoid, and my hunch is that there exists a breaking point that could be hit with an aggressive and sustained boycott / cancellation spree, but again, I'm not a math surgeon so I could be wrong. That's just my gut feeling.
Pro financial tip: Be a patient gamer. Get the games you are interested in during sales. Fuck FOMO, subscription models and pre-orders.
Lately, I've only been buying indie games. I can't justify dropping $70-$80 on one game and even when those games go on sale they're usually $40-$50.
If you read reviews and do a little research you'll find that there are actually a lot of really cool indie games and you can get multiple games for just a fraction of the cost of double or triple A games.
The price increase is absurd. I cancelled too, because while I do play quite a bit, this level of corporate greed is completely unjustifiable to me. If rather watch playthroughs of new games on Twitch or YouTube and then buy them a year later on sale than pay this bloody much, eff that.
To be fair it‘s as absurd as it was inevitable. Gamepass was always meant as this temporary thing you can try out to play some new games until everyone jumps ship because of increased prices. It has been preached for years. No one could‘ve seriously thought this was a long term alternative to buying games or at least buying licenses to games on Steam. All online subscriptions are scams in the process.
It's nice they pulled this nonsense during a steam sale. Cancelled and picked up halo mcc and silksong.
You know, fundamentally, I don't hate Gamepass as a concept. "Netflix, but for videogames" is an idea I can get behind, as it widens the audience for something I love by lowering the bar of entry. There are plenty of people out there that benefit from being able to play a few games here and there without needing to commit hundreds of hours to $100 purchases.
But Netflix has overstepped with price hikes and ads, and I've cancelled my service with them. That Microsoft thinks it can charge some ~$40CAD a month is pure hubris. I hope they learn quickly that, at that price point, the enthusiast market will happily cancel and just buy their games outright, and the casual market will decide it's an expense they don't need.
I already canceled because of the atrocities Microsoft does / is / supports.
Not that the harm hasn't already been done, but I did just see this: https://thisweekinvideogames.com/news/microsoft-pulls-azure-services-from-israeli-military/
EA also further buried the ability to cancel EA accounts, after the announcement they had been sold to the Saudis and Kushner.
Between that, this, and Disney+ cancellation page "accidentally" going down during that fiasco, this is exactly why I've switched to using only virtual cards for subscriptions. Pause/Cancel the virtual card, voila, no more subscription.
Good thing I never signed up for one.
Any Steam game that requires an EA, Ubisoft, Blizzard, whatever account is a total non-starter for me. I’ve looked at some of the newer Battlefields when they’re on sale for like $2 and I still can’t be convinced. Likely never will.
Ok with me, there’s lots of other publishers out there, both independents and studios, that I’d much rather give my $2 to.
I haven't subbed to gamepads for years because I knew this would eventually happen. Gamepass was designed to get people used to not purchasing games and instead letting them come to them. Subscribers now have to chose between paying even more each month or losing access to the library of games available to them.
Gamepass only ever made sense to people who had time to play or dabble in a sufficiently large amount of games per year and felt the need to play some new titles soon or immediately instead of waiting. Otherwise, eventually your total subscription costs would outpace the total cost to purchase what you played, especially if purchased on sale at a later date. And the value gets worse if you ever replayed a game (s).
I'll never really understand the excitement about this service. It was always a Trojan horse.
I learned after a few months of game pass that most of the games that looked interesting actually weren't. It's no big loss, and it's cheaper to just buy the few games I actually want anymore. Doubly true now.
It's honestly cheaper to just buy games than pay this subscription per year.
Plus, you get to keep the games.
Between the cost of housing and the cost of food, and the fact wages aren't that much better than they were 15 years ago - you'd think they would realize they are asking for the scraps people have left.
I've always just bought games when they're on a good sale, I've never had a game pass type thing. But maybe they just want to squeeze a bit more out of their most loyal customers and they're accepting that it is a dying model.
Once upon a time, the idea with subscriptions like this was to have customers set it and forget it. Charge them a small/reasonable amount and they'll keep giving you money forever. Giving people a reason to think about - or worse, evaluate the merits of - the monthly deposit they're giving you used to be a sin for companies.
But here we are, seeing the difference between "companies" and "corpos".
Honestly, I've kinda gone back to buying physical media.
I bought DK Bananza on cart, and guess what? After I finished it, I gave it to my brother. Imagine that! Sharing a game you own? Madness.
I'm eager to pick up Ghost of Yotei from the store this afternoon, as well.
I canceled. I don’t want the features they added. I don’t even use all the features they charge me for now. I just want to be able to try out so new games every so often. I’ll take the $30 I save and buy those same games, probably with some money leftover
Just canceled my 4 year old subscription. Can’t wait to hear the complaints from my kid but Netflix is likely next.
The missus and I sat down about a year ago and tabulated up how much all of the various streaming subscriptions were costing us per year (it was close to $1,000 when including YouTube Premium).
We cancelled every single one, and put that money towards building a home NAS and filling that up with downloaded media. No more ads, stupidly low bitrates, or TV shows & movies disappearing because a license expired.
The server has more than paid for itself at this point, and every additional spare dollar is being put aside for our kids’ tuition.
ETA: Consider doing the same, your kid’ll likely thank you in the long run!
PS: Never too late to introduce them to all of your favourite classic games, either - though that one may be a bit harder to get them onboard 🤣
I have a 16TB server and an extensive steam collection. I already explained it to him and he was fine about it.
Now is probably not the best time to sell my xbox.... I bet the market is flooding
You might even be able to sell it for what you paid for it...
For years I've been warning whoever would listen that XboxGP, much like any other content subscription service owned by a public company would inevitably lead to a massive consumer squeeze. Fortunately it happened before MS managed to metastasise into a monopoly in gaming too. Good riddance.
Knowing Microsoft, I'd like to thing that it went down like this:
Pardon me, your department isn't achieving the expected 20% annual revenue increase.
But we're just selling subscriptions to games that cost us nearly nothing. It's free money.
And you need to make more money from it, increase your subscriber count or your costs, or we'll cut your staff.
Then they cut staff anyways, because why leave free money on the table?
Getting users to pay extra for features that should already be included with their overpriced consoles is such a scam.
It's the Microsoft way. They hide security features that should be standard behind higher subscription tiers. It's entirely bullshit.
Internet is being shitty on link. What is the price increasing to/from? When was the last increase?
It varies by location. But for me on brazil at least every single subscription doubled in price. PC Game Pass was 36 BRL, it is now 70. Ultimate was 60 BRL, now it's 120. I cannot justify this shit.
I really appreciate this, you just saved me at least $20.
Microsoft’s user experience is awful at every step in a browser. I wanted to like XBox but it’s clear why they’re losing.
Netflix Spotify Disney and Amazon proved that price hikes are effective at increasing profits even despite the loss of subscribers. Capitalism baby.
I think the only time collective cancellations actually hurt one of these companies was that time Jimmy Kimmel made fun of the president and it took an estimated 1.7M ex-Disney Plus subscribers.
Turned off my recurring billing. I'll have about 3 months then it's bye bye. I have been a customer since 360, but now will probably sign up for Playstation Network for the first time.
Ehh... PSN isn't really any better. Their Game Pass competitor is a hot mess. Better to just buy games outright, especially during sales.
It was nice to have Xbox a month or two a year to play new releases. Guess that it’s over now, no problem, still a patient gamer.
I work in the IT software licensing industry, it's a fucking cancer I can't wait to fail so bad that when we have the first extended internet outage failure so bad that it shows the world that subscriptions are a liability that shouldn't exist
Just cancelled mine. I have barely been doing ~2 games per year, and the cost was low enough for me to not really care about the months I didn't play at all.
But a price increase is the straw.