Shawn Layden, an ex-executive for PlayStation, doesn’t think developers have much luck turning a profit on subscription services like Xbox Game Pass, especially when putting games into those services on launch day.
“I think I said somewhere that in order for Game Pass to become profitable, you have to have something like 500 million subscribers,” Layden explains in an interview with The Expansion Pass podcast (embedded below). “It’s a number chosen for hyperbole. But turns out, it wasn’t that wrong? And people would always say, well, Microsoft is profitable. But that’s like saying the casino is profitable. The house always wins, right?”
The former PlayStation boss, who led the brand through its PS4 golden years, acknowledges that the “platform itself can find a way to create a profitable experience out of” monthly gaming subscriptions that offer hundreds of games, but individual developers aren’t so lucky.
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“Developers who are building a game and your hope is always to get into overages, into profit sharing, to blow through your break even point where you start turning a profit on your games. In a subscription model that’s just impossible to do,” Layden says.
Game Pass’ viability for indie games was a hot topic a few years back, and plenty of developers actually came out in favor of the service. The solo developer behind the Falconeer series, Thomas Sala, said getting signed onto the service is “generally a very positive thing.” Citizen Sleeper lead Gareth Damian Martin also said he wouldn’t have been able to make a sequel to his acclaimed sci-fi hit without Game Pass.
But the economics are probably trickier for big-budget AAA games. “Strictly speaking, your $69.99 game has one chance to bust out and break through,” Layden explains. “And that’s where these subscription models, I think, came into conflict. PlayStation didn’t go that route with day-and-date on AAA games. Microsoft did. You know, you can judge the outcome on your own.”
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