Games Data
Console MAU Data: Adding Games to Subscription Services Leads to Longer-Tail Engagement
Jelle Kooistra
The global games market is bigger than ever. This year alone, the world's 2.7 billion gamers will generate game revenues of $159.3 billion. Revenues from console games, which are up +6.8% year on year, will contribute $45.2 billion to this number.
And the ways gamers engage with their favorite pastime are changing, directly trickling into revenues. In particular, dedicated content subscriptions (Xbox Game Pass, Sony's PlayStation Now) are becoming more important, alongside online services (Xbox Live, PlayStation Plus).
Subscription services on console will generate $5.8 billion this year, accounting for 13% of the console market and 4% of the overall games market. These revenues are only due to grow in the coming years.
But what do these subscription services mean for developers and publishers? How does adding a game to such a service affect monthly active user (MAU) numbers? Is it worth it in the long run for developers (small, medium, and large)? In this article, we will leverage data from Newzoo Expert to explore.
For example, Xbox Game Pass helped Red Dead Redemption 2 almost triple its Xbox userbase from April 2020 to May 2020. But what happened next? We'll delve more into this later in the article.
For PlayStation 4, we'll use June's free PlayStation Plus games, Star Wars Battlefront 2 and Call of Duty WW2, as case studies. You can learn more about what goes into our console MAU data here.
Red Dead Redemption 2 on Xbox Game Pass: Spiking Engagement 1.5 Years After Launch
The initial sales period for full console games is still essential, especially for flagship titles like Rockstar's Red Dead Redemption 2, which launched at the end of 2018 to critical and commercial acclaim.
For smaller games—or titles that do not sell as well as the publisher projected—this data is harder to come by. Luckily, console MAU data provides a reliable benchmark for tracking these titles (and the competition).
There's a reason Rockstar Games launched just two major titles between 2013 and now but launched multiple titles per year in the past. Live-service aspects of games (like GTA Online in Grand Theft Auto V) result in:
More engagement with games
Longer user retention and therefore an extended product lifecycle
And longer-tail revenues.
With games becoming increasingly complex (and expensive) to develop as graphic fidelity rises, stakeholders and shareholders of AA(A) console publishers are increasingly asking about the above. Thanks to new developments in the market, there are now a variety of options to increase engagement post-release.
One of these strategies is to use new monetization models, such as battle passes. However, this method may be more challenging for AA publishers and developers (Devolver Digital's recent Fall Guys may buck this trend).
Adding a title to a subscription service is an attractive alternative and can work for publishers of any size. Even the most prominent names in the industry are experimenting with such services.
In May 2020, for example, Microsoft added Rockstar's Red Dead Redemption 2 to its Game Pass subscription for Xbox One. As you can see below, the MAUs for the game massively spiked on the platform:
Red Dead Redemption 2 MAUs (Xbox and PlayStation)
Game Pass skyrocketed RDR2's monthly active users on Xbox One
The expected increase in player numbers has implications for future revenues. One component of Red Dead Redemption 2 is Red Dead Online, which features monetization strategies like in-game transactions (for in-game currencies to buy cosmetics and upgrades).
Our Newzoo Expert data shows that same is true for almost all games added to the service, including Fallout 76, which was added on July 9, helping Fallout 76 more than double its audience and contributed to extremely high engagement on Reddit.
These publishers (Rockstar, and Bethesda) and the platform holder (Microsoft) likely hope that this engagement will lead players to spend more on in-game transactions.
Content Subscription Services: Giving Older Shooters a Second Wind on Console?
While content subscriptions such as PlayStation Now and Xbox Game Pass are relatively new additions to the market, we can also see a similar trend in older services on console.
Online subscriptions (PlayStation Plus and Xbox Live Gold) have long been a requirement to play online multiplayer modes on console. Both services have also been adding monthly free games to their respective services for close to a decade now.
Sony added Call of Duty WW2 and Star Wars Battlefront 2 as ''June's'' free PlayStation Plus games. Star Wars was free to claim from June 2 to July 6, while Call of Duty was free to claim from May 28 to July 6.
Call of Duty WW2 & Star Wars Battlefront 2 MAUs (PlayStation)
Going free on PlayStation Plus led to retained users in July
Again, the MAUs unsurprisingly spiked, but many players stayed engaged beyond the PS Plus period, and MAU numbers were far higher than before the games were free on the service. The longer people play, the likelier they are to pay (for in-game purchases).
As you can see, Call of Duty WW2 spiked a little in May. This highlights how quickly users play the free titles, as the game's PlayStation Plus promotion began May 28.
The focus on engagement is also evident in Call of Duty's latest Battle Royale variant, Warzone, which launched free to play as a standalone game mode and is doing extremely well, according to data in the Newzoo Platform.
This is reinforced by Activision CEO Bobby Kotick, who announced that over 75 million people downloaded Warzone since it launched in March 2020.
Similarly, Microsoft announced that the upcoming entry to its flagship Halo franchise will feature free-to-play multiplayer. Clearly, companies are reaping the benefits of making games easier to access, in hopes of securing revenues in the future.
While publishers are sacrificing the short-term sales revenue for new releases, the long-term benefit of consistent, predictable revenues cannot be underestimated, as shown by the mobile game market's massive revenues.
Consumers are already accustomed to subscription-based consumption of entertainment content (Netflix, Spotify), making the concept familiar to most.
For the games business, subscription services offer exciting new ways for publishers to monetize their games, taking pressure away from the standard $60 buy-and-play experience and allowing room for experimentation, niche games, and smaller experiences.
Looking for data to inform your journey into the world of content subscriptions? Contact questions@newzoo.com, and we'll see how we can help. You can learn what else is included with Newzoo Expert here.
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