Financial news source Bloomberg analyzes Xbox Live in an article looking at how much revenue the service generated for Microsoft last year. Sure, we all knew (or could at least guess) it did pretty well -- but here's just how well, according to analysts and officials.
1) Xbox Live "probably" broke $1 billion in revenue
While Microsoft declined to give Bloomberg specific numbers -- and never breaks Xbox Live totals out separately in earnings reports -- Dennis Durkin, Xbox's chief operating officer, told them that download sales of movies and TV topped the revenue Microsoft gets from subscriptions. An analyst at Goldman Sachs Group Inc. in San Francisco estimated that that puts total sales at $1.1 billion.
2) $600 million of that came from half of the 25 million XBLA users who pay for subscriptions
With games like Call of Duty: Modern Warfare 2 relying more often on online multiplayer and downloadable content packs for lasting appeal, it's no wonder more users would want Gold subscriptions than did three years ago. Also, special 30-day exclusives like MW2's Resurgence Pack DLC reinforce Microsoft's concept of customer loyalty.
3) Activision wants a (bigger) cut
Activision CEO Bobby Kotick told Bloomberg that the company wants a cut of the subscription revenues in addition to the percentage it gets from DLC sales on Xbox Live. "We're driving a lot of the subscription interest and certainly hours of game play," he said.
Business-savvy gamers and those with an abiding dislike for Activision could probably guess at least two of these points; but with Bloomberg printing information that advises its readership to buy shares in Microsoft, those of you who don't think much about this kind of stuff might want to take note. After all, it's your loyalty everyone is trading on.
Source:
Microsoft's Online Xbox Sales Probably Topped $1 Billion [Bloomberg]
CORRECTION: GamePro corrects an earlier version of this article that incorrectly stated all 25 million Xbox Live users paid for Gold subscriptions.
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