Multiple current and former leaders within Xbox’s first-party studios reportedly “absolutely detest” Xbox Game Pass, believing the subscription service damages the value of games. Under former Xbox CEO Phil Spencer, the company created Xbox Game Pass, which gives subscribers access to brand-new, day one releases at no additional cost. Recent changes in executive leadership are starting to re-evaluate that decision.
Microsoft launched Xbox Game Pass in June 2017, creating an all-you-can-play subscription model much like Netflix, containing everything from first-party AAA blockbusters to third-party releases and tons of smaller independent games. Day-one launches quickly became one of the service’s defining features and selling points during a period of Xbox marked by shifting exclusivity plans, studio restructures, and a weaker interest in dedicated console hardware sales. However, putting big-budget game releases on a subscription service that was originally priced at $9.99 a month would create a long-running fan debate over the service’s profitability and the price perception of games. New reports suggest that senior figures inside Xbox itself may also share those concerns.
Xbox Leaders Reportedly Think Game Pass Has Hurt Their Games
Bloomberg reporter Jason Schreier, on the Triple Click podcast, shared that numerous people in Xbox studio leadership “absolutely detest Game Pass,” voicing similar concerns that fans have speculated over for almost ten years. According to Schreier, the interviewed parties believe the service has damaged the value of their releases, lowered the perceived value of games overall, and negatively impacted the whole industry by conditioning fans to expect major titles through subscription services. These frustrations center less on players enjoying the affordable access Xbox provides to major video games and more on what day-one availability communicates about the market value of a new launch.
Rearrange the covers into the correct US release order.
Rearrange the covers into the correct US release order.
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A similar report was recently published by Jez Corden of Windows Central, who spoke to former Xbox studio leaders. One former lead argued that offering a title through Game Pass at launch could communicate that it lacks enough value to sell independently, describing the strategy as a “race to zero.” Another former Xbox leader reported that Microsoft uses an engagement-based formula to distribute Game Pass revenue back to studios, viewing these calculations as insufficiently transparent and demotivating to developers compared to a traditional sales model. As a result, it seems like Xbox and its various studios could be suffering an internal problem where a game could attract a large audience on Game Pass while the development teams remain uncertain about how that engagement will translate into revenue or bonuses.
Despite problems that could be going on behind the scenes at Microsoft, Xbox Game Pass remains an attractive option to consumers as a low-cost way to play games they might not be familiar with. Moreover, smaller indie games launching through the service have reached massive audiences that studios believe they would not have seen otherwise and that could struggle with traditional storefront visibility alone. Indie devs have described Game Pass agreements as a great source of funding and stability, which is hard to come by in the industry. The Game Pass argument as a whole could perhaps be less about whether the service has value but more about who receives that value and how transparent it is. Microsoft’s revenue allocation model and success metrics, as they stand, appear confusing and frustrating to its studios and perhaps in need of a change.
Bloomberg’s Jason Schreier has speculated that Microsoft could eventually reconsider putting every major release on Game Pass on day one, given its current restructuring efforts. The company has already taken significant steps to change its plans for Xbox Game Pass’s business model. However, moving away from day-one exclusives would be a double-edged sword, as it may improve traditional sales numbers while weakening one of the service’s key benefits. Given Schreier and Corden’s statements, fans could assume that Xbox’s future challenge will be preserving the consumer appeal of Game Pass without convincing players or its own developers that games no longer carry meaningful value.
Source: Windows Central
