Subscription gaming services such as Xbox Game Pass, EA Access and PlayStation Now have become a good deal for players – or at least, a good way of ensuring you never reach the bottom of your pile of shame. As this year’s E3 festivities made plain, they are now central to platform holder strategy, with Microsoft releasing all its first-party titles on Game Pass, and Google Stadia to ship with its own, if rather meagre, subscription game service. But are they always a fair deal for developers? The details of these partnerships remain closely guarded, but in a panel discussion at Gamelab last week hosted by GamesIndustry.biz editor-in-chief Matt Handrahan, some of the people behind Crusader Kings, Rime, Q.U.B.E. and Inside offered broad thoughts on Xbox Game Pass in particular.
“Consumers want as many games as possible, as free as possible, and you can’t get anything for free, so you need to find the right price, but that’s the angle,” began Dino Patti, co-founder of Playdead and latterly, Somerville developer Jumpship. “Developers need to look at what does this get me, and for me, and I might be biased, but I think the way business is for Game Pass, it’s the first time it’s actually what I would consider fair for developers.
“[All the other times] I’ve been suggested subscription it’s never worked out, because they don’t know what developers need, and in the end, it is developers putting out a game for free!” Patti went on, adding, “with Game Pass they’re doing it correctly for the developers.”
Paradox Interactive ex-CEO Fred Wester was rather cooler on the subject than Patti, suggesting subscription service providers need to be more mindful of the kind of game they’re licensing when thrashing out terms with developers. He drew a comparison with how Spotify and Netflix remunerate musicians and film-makers. “Spotify, they pay you depending on how many times your song has been played. On Netflix, they pay you a fixed fee depending on what they think your [product] is worth. Those are two fundamentally different things, and that’s what you see here as well.
“OnLive, for example – they said you can have your game on our service and we’re going to attract a lot of customers, and we’re going to deliver you money based on how many hours people play the game. Now at Paradox, we loved that business model, because people play our games for three or four thousand hours. While the Game Pass model to us is still a decent model, we think we’re not getting paid enough, because people play our games more than they play very single-player driven narratives.”
Wester described the investment in games for subscription services as a “gold rush”. “I’ve never seen anything like this in my 16 years in the industry,” he went on. “People are throwing money at everything. If you can’t make money today in the games industry you’ll probably never be able to make money ever – like seriously. If you’re an established company, I mean – new companies always struggle.”
He cautioned developers in attendance, however, that the good times wouldn’t roll forever, and advised them to put long-term self-sufficiency first. “What you need to consider now, when people throw money at you is, three years from now when the pendulum has swung back, and all of a sudden you’re standing there knocking on Microsoft’s door saying ‘please let us in again’ – which is going to happen eventually, we all know that, hopefully – is your business model sustainable, and has it been the whole time? And do you have direct access to the people playing your games?
“Those are the only two things you should think about, because if you sell yourself now, with a business model you don’t even believe in, because you get $10m cash in hand, I don’t think you’re going to have a good time in three years. Because these times are not going to come back. I’m sounding like Dr Doom here, I’m a paranoid man!”
Raul Rubio, CEO of Rime developer Tequila Works, expressed this a little more saucily, enjoining developers to “choose your development partner as carefully as you choose your love partner”.
Q.U.B.E. creator Dan da Rocha was most tentative of all on the idea of releasing over a subscription service. “At the smaller studio scale, if the price is right, that can work, but at this point in time [for us] it would mainly be for back catalogue stuff, to get on there, onto emerging platforms – to test the waters,” he said. “I think, you have to look at the numbers to see if it makes sense.”
The developers also shared thoughts on the ups and downs of the console business in general, commenting that, for all the stripping back of certification procedures and investment in self-publishing programmes, it was still something of a walled garden. “I still feel like there’s a barrier to entry for the small developer perhaps, compared to Steam and other PC platforms, but it’s become more democratised to get onto those platforms,” Rocha went on. “Development kits have become readily available.
“Since we came out [with our first game] – back then you had to know someone at Valve. Now the floodgates are open, anyone can be on there. I think there’s still that barrier on Xbox, PlayStation and Switch. But once you’re through the gate, if you have a new game, once you talk to somebody at that platform, I think it becomes a lot more open.”
For Dino Patti, a veteran of Xbox Live Arcade’s heyday, the strength of the console business is precisely that it’s harder to break into than any PC storefront.
“The barrier to entry at Microsoft actually wasn’t a problem – that was and still is the good thing. I often compare this to an athlete: if you’re running really fast in a sports club, nobody notices you. If you go to the Olympics, and you’re unknown, at least there will be press around you. If you go to console, you can get press, because not every game gets to go to console.”
Beyond the implications for individual studios, there are concerns over what subscription services bode for the gaming market and community as a whole. As this editorial from GamesIndustry’s North American editor Brendan Sinclair argues, the fact developers don’t have access to (often questionably defined) consumption metrics means they have less clout in negotiations with platform holders and publishers. Middlemen, in other words, may benefit from a subscription-driven industry more than creators.
Microsoft has said, however, it thinks subscription packages will continue to co-exist with other ways of selling games. “We don’t have a goal of being the subscription where you get all your content,” head of gaming services Ben Decker told GI in response to the aforesaid editorial. “This is meant to be additive to the ecosystem. We don’t see a future where subscriptions are dominant. We see a future where customers have choice between a subscription and purchase-to-own, where there’s a mixed ecosystem because that’s what customers want, and that’s what developers want.”
This article is based on Eurogamer’s attendance at Gamelab. Travel and accommodation were covered by the conference.