ZhugeEX, one of the administrator of the website resetera, posted the following info on the Microsoft first party thread.
A report from an institutional investor that held a meeting with Microsoft last year.
Microsoft views the Xbox Game Pass, which now includes new first-party titles, as a compelling value to consumers at $9.99 per month. Xbox Game Pass can also help to drive monetization for smaller third-party titles that would otherwise garner little attention relative to their much larger peers. The inclusion of Microsoft’s new games in the service has resulted in a lift to the overall retail sales of those titles as a key point of friction to gameplay has been removed. With that said, it doesn’t expect to see new AAAs from the third-party publishers included in the service any time soon. Instead, it expects multiple subscription services to emerge over the next several years, although individual publishers may not have enough breadth to provide a compelling product to consumers.
In Microsoft’s experience, subscription services generally boost gameplay time, engagement, and monetization. Within Xbox Game Pass, it is seeing core gamers who want to consume more content that they otherwise couldn’t afford, as well as casual gamers who prefer not to pay $60 upfront for a given title. Overall, it has seen a boost to net dollars in its video game ecosystem, with more games translating to more hours of gameplay. It intends to bring the subscription service to PCs at some point.
Microsoft is working on a game streaming service that will deliver console-quality experiences on mobile. According to the company, there are two billion gamers worldwide. It believes that a streaming solution needs three components to be successful: good content, a strong community, and a robust cloud offering. It has termed these items as “the three Cs.” It envisions a scenario where it can eventually deliver games to consumers who don’t own a console, and believes that cloud gaming is closer to being a reality than it has in the past. A successful streaming provider needs a regional footprint with scale to drive efficiencies for the provider and the consumer.
Microsoft believes that its new studios will help it to achieve a primary goal, the delivery of one AAA game per quarter in order to drive Xbox Game Pass. With that said, it does not want to rush its new studios into delivering games before they are fully baked, and believes that any acquisition takes time to get its legs. Its ideal acquisition targets have proven content and strong development teams.
Microsoft acknowledged that it is developing a new console, but timing is uncertain.