Microsoft Admits: Game Pass Hurts Sales!

General news News PC PC News Xbox Xbox News 02/16/2023

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The Redmond-based company also admitted that it pays publishers compensation because of it.

Since the launch of the Xbox Game Pass (colloquially known as Game Pass), the number of subscribers has been slowly but surely growing, with monthly subscriptions giving access to more games, including Xbox Game Studios exclusives from the day they are released. Xbox boss Phil Spencer had previously said shortly after the launch that Game Pass could boost traditional sales by giving games a higher profile, but this comment was met with a lot of skepticism.

The UK’s competition and markets watchdog, the CMA, has published its provisional report on Microsoft’s acquisition of Activision Blizzard King. The Redmond tech giant admitted that Game Pass has hurt sales: “Microsoft also submitted that its internal analysis shows a [redacted] percent decline in base game sales twelve months following their addition on Game Pass.” In response, Microsoft sent a statement to Eurogamer, among others, in an attempt to save face:

“Xbox Game Pass offers gamers and game creators more choice and opportunity in how they discover, experience, and deliver games. For gamers, that means providing another option to discover games and play with friends at a great value. For developers, that means creating another option for monetizing their games. We’re focused on helping game creators of all sizes maximize the total financial value they receive through Game Pass. Each game is unique, so we work closely with creators to build a custom program to reflect what they need, ensure they are compensated financially for their participation in the service, and allow room for creativity and innovation. As a result, the number of developers interested in working with Game Pass continues to grow,” Microsoft said.

Despite Halo Infinite’s first-day availability on Game Pass, the subscription service failed to gain traction in that fiscal year, which Spencer said would account for no more than about 10-15% of their revenue. And they have to pay the parties involved…

Source: WCCFTech

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