> The investors will be demanding the results eventually.

I wish I had time to dig into Activision's financials to get a better feel on this.

They earned $2B last quarter, with over $500m going to Cost of Revenue. For a software company, I'm guessing a lot of this is in multiplayer gaming infrastructure. Cost of Revenue is another $716m, with half going to R&D (engineering) and half going to G&A (rent, administration, etc.).

In other words, if Microsoft can absorb the Cost of Revenue into Azure and optimize the G&A a bit, they can increase quarterly revenue by almost 33%. That's $10B/year. Plus, putting Activision's back catalog on GamePass might drive up GamePass subscriber count/retention and back catalog sales (see the first article linked below).

It would be tough to show this as hugely profitable over the short term, but I think they could model out a 5 year ROI very very easily.

> I also suspect that game pass will make them focus on GAS games (service games) with microtransactions, optimised for profit instead of fun.

I'm not a subscriber, but as a casual follower of GamePass I haven't seen it drive more MTX. On the contrary, it seems to have opened the door to more niche-y games that would have a hard time finding an audience elsewhere.

These two articles give developer quotes that are very interesting insights into both gamer behavior and the economics of putting a game on GamePass:

https://www.forbes.com/sites/davidthier/2021/03/19/game-pass...

https://www.gameinformer.com/2021/03/24/deathloop-dev-opens-...

Yes, these are probably MSFT sponsored and it's not all roses, but even if there's a core of truth to them it's encouraging.

> I also suspect that game pass will make them focus on GAS games (service games) with microtransactions, optimised for profit instead of fun.

If they want to go that route, charging by the month isn't the way to do it. There's a reason exploitative mobile games are free at point of sale. I predict that MS stays the course of putting decent first and third party titles on Game Pass and chooses to raise prices rather than mandate that Game Pass games be more exploitative.