Phil Spencer explains how developers get paid from the Xbox Game Pass

Microsoft’s subscription service, Xbox Game Pass, has over 100 games in its catalog and offers first-party titles, including Halo Infinite in 2021, with great value in starting the program at no additional cost. But one of the biggest issues surrounding the platform is how developers make money from the platform.

Xbox boss Phil Spencer told The Verge that Microsoft has different types of deals, depending on the unique circumstances of the developer.

“Our deals are everywhere. It sounds unmanaged, but it’s actually based on the needs of the developers,” Spencer explained. “One of the nice things that looks good is that developers, usually small and medium-sized developers, start the game and say,” Hey, if you have one, I’m willing to put this in the Game Pass on the release date. It means that. Everyone will give you X dollars now. What we can do is create a floor for them in terms of the success of their game. They know they will get this return. “

In other cases, Microsoft will pay the full cost of producing the game. In this situation, developers can make money from retail sales, but Microsoft also allows these games to be released on PlayStation, Switch, and PC, and developers also receive that income. Microsoft enjoys its unique benefits in this situation by setting the release date and date of the game on the Xbox Game Pass.

“For them, they have protected themselves from any downside risk. Games will be made. Then they will turn all retail up. We have the opportunity for days and dates,” Spencer said. Said. “It’s a flat-rate payment to the developer. Sometimes the developer gets better at the game, it’s just a deal.” If you pay this amount, you’ll get it in your game pass. “”

Other agreements are different. The developer came to Microsoft for a deal based on “use and monetization.”

“We are open [to] “I didn’t think we understood, so I experimented with many different partners. When we started, we all had a usage-based model of our partners. Most said, “Yes, yeah, we understand it, but we don’t believe it, so give us money in advance.”

In an interview, Spencer said it was encouraging to see different types of games revealed thanks to the game pass.

“If your team is pitching a publisher in a retail game and it doesn’t fit in an Excel spreadsheet that shows what the retail results will be, you won’t get a green light.” Spencer said, “This is like Netflix. You can see that Netflix clearly has programs that have never been greened by NBC, CBS, or older models of ABC, and frankly, it can be a real success, and a game pass. To the same level “

The Xbox Game Pass isn’t without critics, as subscription services like the Xbox Game Pass and Apple Arcade further reduce the value of games and make people think that games should be free or cheap.

The Xbox Game Pass is off to a very good start, with 15 million subscribers to date. Approximately 70% of the Xbox Series X | S consoles sold at launch were connected to new or existing subscriptions. This is a good sign for future services.

Xbox Game Pass as a platform is at least not profitable yet. This may be due to the $ 1 sign-up promotion that is still available. It’s also generally understood that subscription services don’t make much money at first.

Most recently, EA Play (formerly known as EA Access) has been incorporated into the Xbox Game Pass with titles such as Star Wars Jedi: Fallen Order.

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