Summary
- Xbox Game Pass may result in up to 80% loss in premium game sales, affecting developer revenue.
- Games on Xbox Game Pass can see a sales benefit on other platforms such as PlayStation.
- Microsoft admits Xbox Game Pass can cannibalize sales.
Xbox Game Pass can be a good deal for gamers who want to try out a large variety of games for one flat monthly fee, but it could also result in a huge loss of premium sales for developers and publishers. That’s according to information coming from a gaming business industry specialist, who seems to be of a mixed opinion regarding Xbox Game Pass and subscription services.
Xbox has admitted that it’s lost the console wars, with Xbox sales flagging behind PlayStation 5, its leading competitor. At the same time, Nintendo Switch units have flown off shelves, even surpassing the PS2 in overall US-based sales during its lifetime. Xbox hasn’t been too worried about the diminished movement on its consoles, though, in part thanks to its Xbox Game Pass service. However, there are questions as to whether it’s really a good deal for everyone involved.
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Video game business journalist Christopher Dring had a thing or two to say while speaking on Install Base about Xbox Game Pass and its overall influence on the industry, including the sales that game companies experience when their titles are available on the service. Dring says that the “figure thrown around” suggests that up to 80% of a game’s expected premium sales (a flat fee paid to play a single game) can be lost when the title is available through Xbox Game Pass. This can also potentially impact a game’s placement on sales charts, with Dring pointing to recent title Hellblade 2 not selling as well as some believed it would, despite still being played by many.
Xbox Game Pass Influence Has Pros and Cons
Dring continued, indicating that games on multiple platforms can actually see a sales benefit, as a game might sell more copies on PlayStation when it’s doing well on Xbox Game Pass. He notes that gamers might try out games on the service that they otherwise might not, given there’s no further financial investment required. However, he’s of a mixed opinion of whether gaming subscriptions are a good thing, stating that he believes they can lead to lost revenue, and that while the service can help get indie games attention, it also makes succeeding as a non-Xbox Game Pass indie title on Xbox extremely difficult.
While the topic is controversial, Dring’s stance isn’t unfounded. Microsoft itself has said that Xbox Game Pass can cannibalize game sales. However, at the same time, Xbox Game Pass has faltered in growth, with the end of 2023 seeing a significant decline in growth of new subscribers. With that said, though, Call of Duty: Black Ops 6‘s launch on Xbox Game Pass was explosively popular, with CEO Satya Nadella stating the game achieved a new record for “Game Pass subscriber adds on launch day.” That may have given Xbox the boost in subscribers growth it has been looking for, though whether it can be maintained remains to be seen.
Xbox Game Pass Ultimate
Xbox Game Pass Ultimate is the highest tier of Microsoft’s flagship game subscription service that offers over 100 game titles that you can play with a single purchase, making it one of the most outstanding value propositions of the Xbox ecosystem to date.