In January 2022, David Edery posted on Twitter a post reaction to the merger of Microsoft and Activision Blizzard. His position attracted the attention of Simon Carless, and then prompted further discussion about the future of the industry.
Recall that David Edery is the co–founder and CEO of Spry Fox (Cozy Grove, Triple Town, Alphabear series). Simon Carless is a gaming consultant, journalist and editor.
What awaits developers?
Initially, Ederi said that Microsoft’s purchase of game studios, as well as the success of Game Pass, leads to the monopolization of the industry by subscription services. As a result, they will displace the economic model of premium titles.
CEO Spry Fox
Outside of the services, the chance of a huge profit will be zero. For indie developers, subscriptions can be a good source of stability. At the same time, the services will directly affect their development and the type of games being created.
Teams whose vision does not fit into the standards of services will be cut off from the market. To some extent, this will resemble the times of gaming retail, but with the difference that the field of free-play games will remain unchanged.
In the discussion, Ederi added that such changes are a long process. It may take 10-15 years before people switch from premium games to subscriptions.
What will premium game publishers do?
When asked by Carless about the fate of premium title publishers, Ederi suggested that the largest of them would stay on the market due to their valuable IP. He also expressed interest in how Valve and Epic will adapt – whether they will keep their platforms in the same form or create their own subscription services.
We cannot discount these companies, especially Valve. Steam has a huge, relatively loyal, customer base. The company itself obviously has a lot of money. I wonder what they're going to do next.
CEO Spry Fox
As for medium-sized and small publishers, Ederi found it difficult to guess their future fate.
What will happen to the service games?
Carless recalled GAAS singleplayer games like Subnautica or Slime Rancher. There are no microtransactions in them, but they have been updated over the years and continue to offer something new to players.
According to Ederi, subscription services are interested in popular games with constant updates. They are willing to pay studios to create such titles.
However, it is unclear whether such games will be monetized outside the services. It all depends on whether the platforms will require full exclusivity from partners.
Perhaps such games will become more like free-to-play (for example, by reducing the base price or by constantly offering optional, but very desirable paid additional content).
Carless also noted that service AAA titles eventually benefit from subscriptions. For them, this is not only payments from the platform, but also a strong influx of new players ready to buy DLC, IAP, etc.
But the expert added that this is relevant for already existing popular games. It’s hard to say whether future games, especially those ordered specifically for Game Pass, will be able to achieve such results.