Confidential documents from Microsoft show some big plans
In accordance with privacy records files in the Epic Games vs. Apple event, Microsoft planned to slash its Xbox store to just 12 percent. In a January paper, the software manufacturer describes its storage fees and modifications and lists the 12% cut-off for PC games revealed this week. While the majority of the important sections of the paper have been written, one page also shows that Microsoft wishes to reduce its 30% shop cut on the Xbox console side.
A table shows that “All games in CY21 will be up to 88/21”, which means, in the 2021 calendar year, that Microsoft has planned a substantial cut into Xbox’s transactions. Though Microsoft confirmed its PC cut, also described in the same table, the company has remained silent about any plans for Xbox. A 12 percent shift would be huge, particularly as the digital game sales of Microsoft, Sony, and Nintendo are now all up to 30%.
“We do not currently expect to adjust the sales share for console games,” a Microsoft spokesman said in an announcement to the Verge. That indicates that these plans have either failed, drastically changed since January, or that Microsoft is not ready to announce changes. Microsoft obviously planned this move either way and would like its Xbox fees to be reduced somehow.
This paper forms part of Monday’s Epic Games versus Apple lawsuit. Questions about Microsoft’s fee schedule could arise in this regard. Lori Wright, Microsoft’s VP of Xbox Business Development, will be a third-party witness for both Epic and Apple next week.
The documents also show that the lower storage rate on the PC side was being adopted by Microsoft with a significant alert. “It is proposed to introduce 88 12 as a revenue share for public pc games for all games, in return for granting Microsoft streaming rights,” the paper says. “The Gaming Leadership Team is currently considering this. We asked Microsoft if this plan would be implemented, but the company did not respond in time. Microsoft plans to decrease its share of PC games sales by 12 percent in August, but it is not clear if the rights to streaming provision are still incorporated.
The Streaming Rights Clause requires developers to ensure that games on xCloud are available for this better income. Cloud gaming rights, particularly Xbox Game Pass, have recently become an evolving battlefield for console exclusivities in many contracts. After publishing those games to its GeForce Now cloud game service, Nvidia also caused pushback from publishers and developers without permission.
Some improvements to Xbox shopping charges will pressure Sony, Nintendo, Valve, and Apple in exchange for streaming rights. As we said yesterday, the operation of Epic Games against Apple is also secretly supported by Microsoft. Microsoft has defended its 30% cut in digital game revenue for Xbox before and Epic Games is delighted to continue. Rima Alaily , Microsoft’s Deputy General Counsel, said last year, “Game consultations are specific devices optimized for a particular purpose.” ‘
According to Alaily , the ‘game consoles’ business model differs significantly from the PC or phone ecosystem because ‘Microsoft subsidizes the hardware and consoles,’ which is largely overshadowed by the market for PCs and phones. An Executive Director of Epic Games also disclosed this week in a court statement that the company has never tried to bargain with Microsoft in order to stop using its Xbox commercial engine. While Microsoft defended its Xbox cut, last year Microsoft admitted that it had “more work to make the right set of guidelines for the game consoles.”
Another classified paper also brings an overview of Xbox games’ exclusivity. Tetris Effect: Connected for 6 months on connected updates exclusivity, The S.T.A.L.K.E.R.2 is listed as a three-month exclusive console agreement and the Gunk is listed as Xbox exclusively.
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