Microsoft vs Sony Game Subscriptions

iwb100

Distinguished Member
A whole 30 million? Just to put it in perspective 1 billion is 1000 million. Microsoft paid 68,000 million for Activision. It’s unfathomable the amount of money they spent on this. Microsoft could’ve easily started 50 game studios for what they just paid for this. I think someone is drunk at the wheel.
You can’t start 50 game studios. Hiring the talent is virtually impossible nowadays. The time it takes is decades to build strong and competent development studios.

Microsoft are cash rich. They had 136billion dollars sitting ready for investments and that was 6 months ago. Probably 150 billion now and rising. They have a strategy and they can expand in this way. Activision would normally be an impossible by. But circumstances allowed it.
 

Cloysterpeteuk

Distinguished Member
A whole 30 million? Just to put it in perspective 1 billion is 1000 million. Microsoft paid 68,000 million for Activision. It’s unfathomable the amount of money they spent on this. Microsoft could’ve easily started 50 game studios for what they just paid for this. I think someone is drunk at the wheel.
Yes, 30 million it’s one of the best selling games of all time. I’m not sure why you are comparing 30 million game sales to the 68B purchase price, the taste of an Orange doesn’t put into perspective the price of an Apple does it now.

I’ve no clue what you mean by drunk at the wheel either.
 

zt1903

Distinguished Member
I don’t know about drunk at the wheel but it’s a ballsy move by Microsoft ….. if it comes off, the deal will take until mid '23 and be subject to regulatory scrutiny but I think it probably will complete though.

Anyway I tell you who will be ecstatic about this deal …… the Activison shareholders, what a win for them. Company has been in the pits and making little that anyone cared about for years, other than Call of Duty, and Microsoft just comes along and buys them out at a huge premium. Truly a gift.

I am genuinely interested in what Microsoft do with this acquisition, it’s a very disruptive move and it could shake out a lot of interesting changes, both at Microsoft and at competitors.

I would say that the metaverse talk troubles me though ….. I think where big tech are going with this is just tremendously toxic. But that’s maybe another topic for another day.
 

rhodos

Well-known Member
tbh I agree with Chad. But only time will tell. COD and Blizzard have been cash cows to date, but enough to justify that price?

Remember its profit that shareholders want, not revenue. You have to earn a lot of revenue from that $70B to get a decent profit and begin to pay it back.

In 2020 Activ/Blizz earned $8B in revenue. I dont have time to google profit, but typically you might get 10% once all costs removed, so say $0.8B.

To earn the $70B back (as that is cash out the door) would take 87 years at that level of profit.

Thats one heck of a gamble by MS, just to take COD and Blizzard off the Sony platform.
 

zt1903

Distinguished Member
tbh I agree with Chad. But only time will tell. COD and Blizzard have been cash cows to date, but enough to justify that price?

Remember its profit that shareholders want, not revenue. You have to earn a lot of revenue from that $70B to get a decent profit and begin to pay it back.

In 2020 Activ/Blizz earned $8B in revenue. I dont have time to google profit, but typically you might get 10% once all costs removed, so say $0.8B.

To earn the $70B back (as that is cash out the door) would take 87 years at that level of profit.

Thats one heck of a gamble by MS, just to take COD and Blizzard off the Sony platform.

It would appear that the bet they’re making is on the metaverse.

You don’t pay $70 billion to take COD away from PlayStation.
 

shoemaker666

Distinguished Member
If Microsoft didnt spend the money they would have to bank it as profit and pay tax on it this way they get an asset and can declare less tax.

Amazon do the same rather than pay tax on the profit the spoend it and just build more distribution hubs every year
 

sevenxl77

Well-known Member
I do hope Sony create a gamepass equivalent.

Apart grom Gran Tourismo and after playing the previous versions of GOW, Horizon and Last of Us I can take them or leave them.

If a playstation gamepass came about with day 1s that would be great for me. I know everyone won't feel that way but fingers crossed as I understand something is int the works.
 

zt1903

Distinguished Member
8B USD was net I think

So 8.75 years? Still a few.

I don’t think so, the price is 20.8 times EBITDA of about $3bn (forecast for current year). Net earnings would normally be after interest, tax, depreciation and amortisation so would be a fair chunk lower.

 

shoemaker666

Distinguished Member
I do hope Sony create a gamepass equivalent.

Apart grom Gran Tourismo and after playing the previous versions of GOW, Horizon and Last of Us I can take them or leave them.

If a playstation gamepass came about with day 1s that would be great for me. I know everyone won't feel that way but fingers crossed as I understand something is int the works.

I think there's practically zero chance they will put exclusive PlayStation games on Spartacus Day 1. even at the moment they take their own exclusives off psnow after 90 days
 

sevenxl77

Well-known Member
I think there's practically zero chance they will put exclusive PlayStation games on Spartacus Day 1. even at the moment they take their own exclusives off psnow after 90 days
That's a shame, I think gamepass has spoiled me. For someone like me, I'm never going to buy those games as not a huge fan but would happily pay £10 a month or whatever to play the new games. I guess it's whichever business model works best to make the most money.. I'm sure the will do/have done the sums.
 

zt1903

Distinguished Member
I think there's practically zero chance they will put exclusive PlayStation games on Spartacus Day 1. even at the moment they take their own exclusives off psnow after 90 days

Agree, do not see this happening in the short term. The exclusives sell very well so there’s no immediate incentive to give them away as part of a cheap sub.

I believe that it’s also a mistake to think that what Sony need to do is copy Xbox. They're in a completely different position with a completely different set of assets, objectives, etc.

I think there’s more exciting and innovative things they could do than just give away the family jewels for next to nothing.
 

Nomad1

Active Member
A whole 30 million? Just to put it in perspective 1 billion is 1000 million. Microsoft paid 68,000 million for Activision. It’s unfathomable the amount of money they spent on this. Microsoft could’ve easily started 50 game studios for what they just paid for this. I think someone is drunk at the wheel.

It does sounds like you are trying to downplay one of the biggest purchases in gaming history.

Microsoft purchasing Activision Blizzard for $69 billion is a fair deal in my opinion. You need to remember that Activision/Blizzard have consistently made legendary games like :
  • Warcraft ..
  • StarCraft ..
  • Call of Duty.
Microsoft are growing, they are due to make Intel Arc Alchemist GPUs that would in future compete with NVIDIA and AMD. Microsoft might decide to make future Call of Duty games as exclusives for XBOX and PC, that could really hurt the PlayStation platform considering the PS5's scarce game line up (if they continue down that path). I hope Microsoft really focus on making some legendary games and make them on PS5 as well.

Sony really do need to release more AAA PS5 games and price them reasonably, like for £50 or less . Sony need to improve their subscription service. Add exclusives on there. In my opinion PS Plus and PS Now do not cut it for the PS5, they are not worth it over the XBOX versions. Now XBOX might add Call of Duty to their Game Pass and that's a bargain!
 
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shoemaker666

Distinguished Member
so Xbox will now be keeping call of duty on PlayStation works out ok for everyone really. call of duty day1 on gamepass £70 on PlayStation. MLB the show shows this strategy works as despite it being on gamepass day 1 it was the 9th highest selling game of 2021
 
D

Deleted member 859633

Guest
Sony will just end up becoming more niche in time like Nintendo as 3rd party stuff dries up
 

lee667

Distinguished Member
Sony will just end up becoming more niche in time like Nintendo as 3rd party stuff dries up
I can't see that happening, although that hasn't really hampered nintendo. You still have the likes of EA, ubisoft and rockstar for 3rd party games and it's highly unlikely any of these will be bought so this is probably the last of big acquisitions.

Yes this could potentially suck if you're a big CoD player but I can't see Microsoft making it xbox/pc only given the sales PS generates, yes they may use it as some kind of bargaining chip but who knows for certain.

This deal is far from the death knell for Sony, plenty of other studios out there and this may lead to Sony investing in smaller studios which can only be a good thing.
 

Naqv

Well-known Member
I wouldn't underestimate the amount of players out there who just play casually and single player games. I for one could not care less about COD and if Microsoft want to pay 70billion for COD, that's their issue.

The reason I purchased a PS5 this time round (has PS4 Pro and Xbox One last gen) was due to the sony single player games, which were consistently AAA and outstanding, like Uncharted, the last of us, horizon, god of war. For most of the others, they were on both consoles.

Just look at Nintendo and to see that COD is not the be all and end all of games.
 

FlagshipDevice

Well-known Member
Hypothetically. . .

Sony and Nintendo announce a merger. Joint development of a new console. Acquisitions of major Japanese developers.

Subscription service in line with Gamepass. All first party games, Day and Date. Back catalogue compatible.

Take. My. Money

Thing is. . . the way things are going, they may actually have to sit down and talk about something along those lines. The Japanese are fiercely patriotic folks, after all. And rightly so.

Edit - that was, of course, very tongue-in-cheek. That said. . . What If?
 
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Pavey

Well-known Member
Sony will just end up becoming more niche in time like Nintendo as 3rd party stuff dries up

Switch has just surpassed over 100m hardware sales; more than the Wii and on course to overtake the PS2.

All without CoD and GTA. I think they don’t mind being ‘niche’.
 

Darth_terra

Distinguished Member
Switch has just surpassed over 100m hardware sales; more than the Wii and on course to overtake the PS2.

All without CoD and GTA. I think they don’t mind being ‘niche’.
It hasn't passed 100m yet I don't know where you got your info from, but the official Nintendo figures which you can see here IR Information : Sales Data - Dedicated Video Game Sales Units
has them at 92m sold, on the way to beating the Wii at 101m and a long way of PS2 at 158m.
 
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zt1903

Distinguished Member
Switch has just surpassed over 100m hardware sales; more than the Wii and on course to overtake the PS2.

All without CoD and GTA. I think they don’t mind being ‘niche’.

it’s got to pass the PS1 and PS4 first then sell a shed load more before it’s anywhere near the PS2.
 

Stockpile Thomas

Distinguished Member
it’s got to pass the PS1 and PS4 first then sell a shed load more before it’s anywhere near the PS2.
Yeah it’ll likely overtake PS 1&4 but the mighty PS2 will be a very tough nut to crack.

The (well deserved) success of the Switch has been phenomenal and totally unexpected after the god awful Wii U. I’m glad Nintendo are doing well and gaming is a much better place with them. Zelda on PlayStation is the dream…
 

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