With the service featured as a staple of the Series X launch line-up, Xbox Game Pass is currently bigger than ever, boasting a wide variety of critically acclaimed and commercially successful games. From The Witcher 3: Wild Hunt to Doom Eternal, the library available on the service provides a little something for everyone, whether that’s significant AAA blockbusters or obscure indie gems.
However, many have wondered exactly how the team over at Xbox establish deals with third-party developers porting their biggest titles to Game Pass. Speaking on the subject in a detailed interview with The Verge, Head of Xbox Phil Spencer spoke at length about how Microsoft compensates developers aiding in building the Game Pass lineup, claiming the studio’s deals are “all over the place.”
“It’s really based on the developer’s need,” Spencer states when asked about how the terms are ironed out between Xbox and third-party developers. Allegedly, developers frequently ask for a certain sum of money in exchange for shipping their release on Xbox Game Pass when it launches, which Spencer claims is a strong incentive because it creates “a floor for them in terms of the success of their game.”
Xbox pays a set amount of money which often goes into the game’s production (in certain cases, Microsoft has even covered the entire budget) and, seeing as the deal never limits the title exclusively to Xbox Game Pass, it means all the income from the likes of Steam, PlayStation, and Nintendo goes straight in the profit margin. As Spencer puts it, “they’ve protected themselves from any downside risk.” Alternatively, a lot of studios close to the conclusion of their development cycle just asked for a flat fee to see the game debut on the service as well.
Spencer claims some deals are a little less straightforward, however, with agreements based around “usage and monetization.” As it stands, the company isn’t allegedly set on just one way to make Game Pass deals, claiming it’s happy to experiment or custom fit the process to the developer. According to the Head of Xbox, the model was initially meant to center on usage, much like streaming sites such as Spotify.
For those unaware of how it works, it would mean the developers get paid more depending on how many Game Pass owners have downloaded their title. Yet, it seems several studios didn’t trust this process, asking for flat out fees rather than a usage-based model. Spencer hopes it might trend back that way eventually, albeit maybe through a “hybrid model” rather than a flat out revshare focus.
Source: The Verge
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