Schreier continues to dominate the Stadia schadenfreude beat. Google spent tens of millions for ports.

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bigsocrates

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Nothing shocking here, I guess, but boy that does not seem to have been a well run project. Apparently some people in Google wanted a soft beta launch and then to scale up, but instead they decided to launch in beta without calling it beta and just blow a bunch of money, then scale back after that didn't work.

I think this, in some ways, is more of a nail in the Stadia coffin than even shutting down internal development. If they spent that much for those games that means it's likely lots of big games won't be coming in the future, and that could seriously harm the platform's chance to resurrect (if there is any.)

In addition it makes me wonder what Microsoft is spending on Game Pass. If it cost tens of millions just to get Red Dead on Stadia in order to sell it for full price, how much was Microsoft paying to get it on Game Pass in order to give it away? To be fair on Xbox the port was already done and maybe Take 2 was just hoping to rake in more online players, but I wonder...perhaps the Bethesda acquisition would make even more sense if we knew what MS was spending now.

Of course because Game Pass is a subscription service it doesn't really matter to the consumer if it's unsustainable because if it shuts down or gets bad in a couple years you can just unsubscribe, and you don't really lose anything (even if you bought an Xbox for Game Pass you can still sell it, or play normal Xbox games on it.) The risk with Stadia is that if it shuts down you'll lose hundreds of dollars of games.

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ThePanzini

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#2  Edited By ThePanzini

I have doubts as to how viable game pass will be especially considering that recent Eurogamer article speculated 50m subs was MS break even figure, but MS future is not dependent on it as its not the only revenue stream available to MS, Bethesda will pay for itself even if game pass doesn't work out.

Stadia just seems nuts I simply don't see the audience for it, how many people into AAA gaming, willing to spend $60 on a game and don't want to buy the hardware. It seems a very narrow group.

Stadia using Linux + Vulkan killed any chance it had to grow fast and adopt a Netflix style sub, even then your fighting in a very crowded market years aways from releasing their own exclusive content.

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bigsocrates

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@thepanzini: MS's future as a company of course isn't reliant on Game Pass (just like Google's wasn't on Stadia) but I don't know where the Xbox division goes if Game Pass doesn't pan out. It seems to have a lot of eggs in that basket. Maybe it just goes back to being another console and uses the added studios as exclusives to fight it out with Sony, or just pivots to publishing software for PC (or XCloud or something) but I do think Game Pass is an even bigger bet than Kinect was. Of course Game Pass is actually an appealing product, so it has that going for it.

I'm not sure that the Bethesda deal pays for itself without Game Pass either. They paid a LOT for that company. We'll see, I guess. Or Game Pass will work out and we won't.

As for Stadia...they clearly thought that because the tech was good the business would take care of itself. And it is pretty cool that you can stream games to many devices, and useful for people who travel a lot or who just have great Internet or whatever.

The problem was the greedy business model and the fact that people don't trust Google because they shut down a lot of services quickly. And Stadia isn't shut down yet, but it is officially a troubled product.

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ThePanzini

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#5  Edited By ThePanzini

@zoofame: Phil Harrison is the least of Stadia's problem he only joined less than a year before Stadia even launched, overpriced ports is the best you'll get on such short notice.

Its quite funny thinking about it, Google built a gaming platform yet only thought about games a year before release.

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frytup

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The idea of Google senior management trying to understand video game development will never not be funny to me. It's just so far removed from the kind of engineering they're used to and so difficult to fit into the kind of progress metrics the company was built on. Doomed from the start, really.

Not to say they can't still make Stadia work with third party games, but seems rather unlikely at this point.

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mach_go_go_go

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Maybe this makes me a rotten person, but a couple of times a week I pop on by r/stadia to see how deep the rabbit hole continues to be dug. Today's highlight was someone pointing to the 500gb install size for CoD as a reason cloud gaming is the future, either unaware or unperturbed by the fact that CoD isn't even available on Stadia.

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navster15

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I don’t see how Stadia failure has anything to do with Game Pass’s viability. For one, GP is less reliant on streaming and more reliant on digital downloads, which are becoming more popular by the day. For another, it’s backed by the Xbox ecosystem, which despite all the braying online of being smaller that PlayStation, is still a 50 million strong user base that most third parties still consider a viable profit center. Maybe it fails, but subscription services clearly are going to be a player in the video game space, if only for the fact that folks are used to paying for all their other digital content in the same manner.

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bigsocrates

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@navster15: Stadia and Game Pass aren't directly related except insofar as the economics of Stadia may reflect on the economics of Game Pass.

If Stadia is paying $10 million just for a port of Red Dead that people are also expected to buy, then how much is MS paying to let subscribers pay it free? Maybe less, because the software already exists and it probably had sold most of its copies on Xbox (plus Red Dead has micro transactions so Take 2 might like the idea of increasing the audience like that) but it probably wasn't cheap.

The economics of Game Pass have always seemed daunting and now they seem more daunting. But MS has pre-existing relationships and a lot more knowledge about games, so maybe Google just overpaid and Game Pass isn't actually that expensive.

I would add that you're wrong about Game Pass being backed by the Xbox ecosystem. It's backed by the Xbox and PC ecosystems, and because it actually does have a streaming option its expanded into Android and IOS via a browser solution. I think that's one of the reasons that Microsoft is going so hard on Game Pass. The potential audience is enormous.

The question is how much of that audience do they need to be profitable, and how long are they willing to burn money to try and capture it (the answer to the second question is definitely longer than Google was.)

The only thing Stadia tells us is that some of these Game Pass deals might have been even more expensive than people thought. But maybe not.

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ThePanzini

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#10  Edited By ThePanzini

I'm not surprised by the high cost porting to Stadia, we've seen how little effort third party publishers have been with Nintendo even when their hardware is widly successful.

With Stadia starting from zero and being its own platform Google were almost asking to be riped off any game developer / publisher have all the leverage.

I don't think we can deduce the cost of porting to Stadia with the price MS pays to put games into GP.

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navster15

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#11  Edited By navster15

@bigsocrates: Here’s the difference between Game Pass and Stadia though; one is a subscription service that gets you a ton of games you want to play and more added each month, and the other a poor imitation of PS Plus while the actual games folks want to play are behind a $60 per pop paywall. There’s more inherent appeal in the former than the latter.

And what about the costs? Microsoft has clearly done the math on the service, seeing as it’s been around for four years, with an actual reasonable path to viability. Some analyst can throw out a number like 50 million subs to break even, but even if that’s true, it’s definitely a reasonable target for Microsoft. Last I checked they had 15 million subscriptions and had sold 50 million Xbox Ones. Is it out of the question that a resurgent Xbox drives Game Pass to success? Whatever they pay for a few months of Red Dead Redemption 2, perhaps the biggest traditional blockbuster of the last gen, is irrelevant. The service isn’t going to falter by occasionally forking over money for a get, that doesn’t hold up to any prior indication.

Not to mention, the service benefits the Xbox brand and ecosystem. There will be folks drawn to the All Access plan, for instance, and the value of that is driven strongly by including Game Pass. Or even people who occasionally use the service but choose an Xbox console or buy a Windows license to have the option, while still perhaps buying games the traditional way (and giving Microsoft a cut in the process).

And I’m not sure how I’m wrong about Game Pass being bolstered by Xbox? The big draw of the service is day and date access to Xbox Game Studios output, the largest library is only accessible on an Xbox console, and even the xCloud is powered by Xbox server blades. An independent, non-Microsoft equivalent is simply not comparable. I mean, you’re not wrong that GP also benefits from being on phones and PC, but that just supports my thesis that the service is in a much healthier place than Stadia. Good job using pedantry to tell me I’m right I suppose?

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bigsocrates

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@navster15: I'm not sure why you're bringing PS Plus into the Stadia conversation. PS+ is a totally different thing (for example it's necessary to play online) but yes Game Pass and Stadia are inherently different and I never said they weren't, just that these eye watering deals may have implications if, and it's a big if, they are related to what Microsoft is paying.

It's not clear what math Microsoft is actually doing. They famously burned billions to launch Xbox, and they're spending a ton on Gamepass. It's pretty clearly not profitable at the moment but they also seem committed to it, which makes sense given the current way that tech investment works. If Game Pass were an independent company it would be a major acquisition target of a bunch of big tech companies. Microsoft has built the closest thing to a Netflix for games internally and that's impressive.

If they continue to build audience at anything like the rate they have been then it may work out, but we'll have to see, and the economics there are important.

Obviously there's synergy between Xbox and Game Pass (I don't think it will actually sell Windows licenses), but the reason I mention Windows and Mobile is that if Microsoft's break even is anywhere near 50 million they're going to have to expand beyond the Xbox market to make it work. Xbox's audience just isn't big enough (and never has been over the last 20 years) to get 50 million subscribers. It needs to capture at least some of the PC and mobile market. And maybe that's possible. Game Pass is really good. I could imagine it being the hit that MS wants. It just depends on the economics.

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navster15

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@bigsocrates: I’m using PS Plus comparison to explain the scale of Stadia Pro in relation to Game Pass, I’m not writing a Sony diss track. Weird shade but whatever.

Look, the original content of my post was whether or not the recent reporting on Stadia had anything to do with the continued viability of Game Pass as a service, and none of what you wrote really refuted what I wrote. You seem to just want to pedantically point to stuff I omitted for the sake of writing a shorter comment as gotcha moments that unravel my underlying thesis. So far I’m not seeing it.

You bring up Microsoft losing money on the service, and I have to ask how that is relevant. Like you say, Microsoft shed billions to get Xbox off the ground, and for nearly 20 years I’ve been happy with the ecosystem. So if they’re losing money on Game Pass, why should I concern myself? If anything, that assures me as a subscriber that they’re in it for the long haul. Or if this is all just chin stroking and play acting as MBAs, I guess that’s just a less interesting conversation to me.

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I wonder if it's possible for anyone new to break into the video game scene at this point. I mean, yeah, Google has a piss poor track record for supporting anything, but if they don't have the money to throw away at video games, who does? Will Amazon fair better with a subscription model, or are people just so used to the current way of things, and the repeated failures of anyone new coming in, that they won't even bother?

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ThePanzini

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@zoofame: Even if Stadia launched into a Beta, how would that make a difference? Besides they already had one in Project Stream, they still had the same problems small game library, high prices and exclusive content still years away.

Google built Stadia without any video game people, Google needed a game publisher years before the platform even launched. A good launch or not was never going to be make or break for Stadia its the months and years following, if Stadia is going to be an alterative to console it needed the same level of support it doesn't by a long way.

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Shindig

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The stadia technology was beta tested extensively, wasn't it? The technology is sound, the business around it is what's bizarre.

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bigsocrates

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@navster15: As a consumer there's not much reason to worry about Game Pass in the short or medium term because it's a subscription service. Your investment is minimal. If the service shuts down you'll get back whatever money you have in months paid in advance or whatever, and if it gets bad because MS stops investing in it you can always cancel your subscription. Game Pass is like Netflix in that you can drop in or drop out depending on whether you like what they're offering at the moment. If someone wanted to buy an Xbox just for Game Pass then they might want to consider its long term viability, but an Xbox doesn't become useless just because Game Pass goes away so even then the risk is low.

The issue here is not what to do in the short term as a consumer (again, subscribing to Game Pass is not like buying stuff on Stadia; there is no real long term as a consumer because it's low commitment) or trying to be a bargain basement MBA, it's wondering what's going to happen in the medium term in the industry.

Yes Microsoft is currently investing heavily in Game Pass, and it's seeing big user growth so for the short to mid-term it will probably continue to invest heavily. But even MS doesn't have unlimited patience. Xbox One was built around the Kinect and they abandoned that. There will come some point where if Game Pass is neither profitable nor on the way to profit they will either abandon it or at least scale back the amount they invest. And a lot of that depends on how expensive the third party deals are (or, I guess, if they keep buying studios to the point where they no longer really need third party support for it.) So if you're interested in the long term of Game Pass then getting an idea of how much it actually costs is useful. We don't know what relationship Stadia's outlandish costs have to Game Pass but seeing these games get eye-watering sums just to be available for sale on the Stadia system certainly implies that platform holders may be paying quite a lot for this content.

@brian_: It is absolutely possible for someone to break into the video game market at this point. As we've seen with the Epic Store, you just need to have a smart business model and be willing to sink cash into getting attention and bringing people to your platform. If Stadia had a good subscription model or had given away a bunch of games like Epic then it would have seen much higher adoption, and any deep pocketed company that wants to break in can if it has a smart plan. That's what Microsoft did 20 years ago. Now is it possible to be profitable in the video game space? That's a harder question. Making money in games isn't easy. Many more companies have lost a lot trying to make consoles than have been profitable. Sony and Nintendo have done it but it's not even clear that after 20 years Xbox has actually been net profitable (it has certainly had profitable years, but also years with big losses.)

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activatetheasset

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@bigsocrates: I agree that it is probably still possible to break into the video game market, but keep in mind, the only reason Epic was able to get their foot in the door was because of Fortnite. They had a huge pile of cash to buy exclusives and give away games because they’re responsible for one of the biggest games on the market. And what’s maybe more important, they had a built-in user base for their store of all of the people who had signed up for an Epic account through Fortnite. Smart business plans are one thing, but having a successful game on the scale of Fortnite is not something you can plan for or rely on. And no matter how deep your pockets are, you can’t buy your way into that kind of success. Having a phenomenon like Fortnite might not be the barrier to entry for the gaming market, but I don’t think the Epic Store happens with out it.

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senorsucks2suck

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@bigsocrates: I want nothing more than for J.S. to develop a game. Those reviews would be priceless.

Stadia is fine. They should have done the Epic store thing of free games. Even if just one a month or quarter. At this point because of Epic’s goodwill I’m more than likely going to buy #Hades there. Also they should have partnered with hotel chains or something. If Motel 6 gave me the highest grade internet at least when I was playing Stadia I’d honestly only stay there. As of now the hotel internet playing well with Stadia is a crapshoot.

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ThePanzini

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I think the time and money it takes to make games nowadays makes it that much harder to break in.

Sony, MS and Nintendo are not going anywhere, even if steaming is the next battleground.

Content is king Disney+ is a prime example and all three now have it in spades, it would be or is very very expensive just having the platform isn't enough.

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bigsocrates

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#23  Edited By bigsocrates

@activatetheasset: Good Old Games is also a successful storefront and while Cd Projekt Red has had hit games it never had something like Fortnite. Also a company like Google could easily just buy another company with a big hit game. Maybe not Fortnite big, but plenty big. Activision bought Blizzard and acquired Battle.net and Google could have done that and turned it into something if it had wanted to.

And of course both Google and Apple already are in the games market with the Android and IOS App stores and they could try to bootstrap off that in a more serious way than they have previously.

There are ways to get into the business either through building or acquisition. It's harder now than when Microsoft or Sony did it, but quite possible. The problem is how much you have to invest and how long you have to stay in the red before you start to make a profit.

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Ubisoft has to be one of the smartest developers and publishers in the industry. They make so much money by riding high on console launch windows and cutting deals like these with console or platform owners.

I respect it.

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Stadia stans are the absolute worst out there (ok maybe not the worst, all fanbases tend to be toxic). They made a poor choice of purchase and they see news stories such as this and the closure of internal development as signs of Google's commitment to the platform and that everything is going well instead of the reality that Stadia will likely be dead in a years time. They constantly go on about digital purchases only consoles and Steam but also seem to forget that those purchases are tied to local hardware so if you have those games installed, you can play them whereas with Stadia, once that service is gone, those games are too. The game selection is also poor as well as being expensive (games that are often old and on sale for $10 or less tend to be full price on Stadia).

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ShaggE

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It really is a shame that Stadia's days are numbered already. I only ever took part in the pre-launch beta test with Ass Creed, but I was legitimately taken aback by how smooth and playable it was over WiFi. It's awesome tech, and it could have been a contendah in more experienced hands.

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Threads like this always make me a bit uncomfortable.

Stadia was an interesting concept with really good tech and some cool ideas that got google'd to death. But it also felt like everyone kind of wanted it to fail from the beginning because meming about how bad it was was more fun than actually checking it out. Actually checking it out makes it pretty clear that it probably deserved to fail but people seemed way too gleeful from the start and a lot of the "takes" feel like almost pre-recorded ones in some ways.

I dunno. I guess stuff like Twitch keep making me think on this. Mixer was... very "fine". Some features were cool (tightly coupled game integration with Forza and... Forza) and the backend tech seemed pretty meh (seemed like a high quality stream used a LOT more bandwidth than twitch) but it was competition. And now that it is gone Twitch is not only fucking up embeds but also the actual use of the site itself and how they interface with game developers. But it was the exact same kind of dunk competition to see who can say they always hated it the most.

Video game wise we are probably still safe and we might, long term, benefit from the two "big" names in game streaming being MS and Sony. But any time people are this gleeful for competition to crash and burn... it makes me worried for what is coming. And it makes me wonder what would happen if digital distribution launched during the social media era.

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bigsocrates

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@gundato: I personally was not rooting for Stadia to fail until they screwed over the developers working for them. Now I'm happy to see upper management embarrassed for their bad decisions.

Sending out an email telling everyone they're doing great when you know you're going to be firing them in less than a month is some grade A weasel BS.

I know there are still engineers and other people at Stadia who care about the project, but seeing the manager exposed as incompetent buffoons is good, even if they won't actually face consequences.

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OurSin_360

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Google went for it and failed, it happens. Honestly I think they could still pivot if they switch the model to a gamepass type of deal, really don't understand why they thought full priced games was a good idea. The real problem is data caps and internet speeds though

Also, since they just sell full priced games, why did they need to spend so much on the ports?

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bigsocrates

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@oursin_360: They wanted to make it a platform rather than a subscription service. They probably thought it would become profitable more quickly that way, which is probably true if it worked. A subscription service requires getting rights to a bunch of content and takes a while to start making money.

They had to pay for ports because publishers don't want to spend the money to put their games on new platforms if they don't think they're going to sell. Look at how much trouble Nintendo has had in getting third parties to put their games out for their platforms unless they're wildly successful. The Wii U didn't get a lot of games after the initial launch burst, and that was Nintendo coming off a massive hit console. Part of that is the tech stuff but a lot of it is just the work of moving stuff over. Even Xbox has trouble getting Japanese games put on it because those games don't sell as well on the XB, despite the fact that XB has a substantial install base.

Stadia was a new platform with apparently substandard tools so there was a good deal of work moving a massive game like RDR2 over.

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Shindig

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They could pivot but that would require some serious compensation towards companies to keep newer games on the service. They might be better off licensing out the tech, or would if the other companies hadn't already got in.

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Ry_Ry

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I'd say that overall I've had a good experience with Stadia. I fit their weird demo of "wants to spend a few minutes with Destiny 2 while the TV is occupied by someone else and I don't wanna go downstairs to use my very old PC to play it instead."

Still can't recommend it to anyone though.

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