Microsoft recently talked about the success of its Xbox Game Pass and PC Game Pass subscription services – which between them have somewhere in the region of 30 million subscribers. However, this was accompanied by news from Microsoft that sales on its Xbox platform are down, with some big games not selling as many copies as they might’ve been expected to in years past.
Some outlets and commentators have seized upon this news in a pretty bizarre way, trying to present Game Pass as some kind of “problem” for Xbox and Microsoft, even going so far as to say that Game Pass is “harming” the company. But… Game Pass was designed to lead to fewer sales. It’s something that’s baked into the subscription model. To use a bit of game dev lingo: it’s a feature, not a bug.
Saying that Game Pass is “harming” sales of games on PC and Xbox is like saying Netflix is harmful to sales of films on VHS, or that Spotify has led to fewer cassettes being sold. The entire point of creating a subscription is to sign people up for the long-term. There are legitimate questions about the viability of the subscription model in the video gaming space, because it’s new and relatively untested. But to say that it’s “harmful” to game sales is, in my view anyway, entirely missing the point.
Consider what Microsoft’s objective is with Game Pass. They hope to create a “Netflix of video games,” where players sign up and remain subscribed for the long haul, playing the games they want as they become available. It’s intended to work in a similar way to the way subscription services work with other forms of media. By definition, that means fewer physical and digital sales. Microsoft will have known this going in, and fully expected it.
Microsoft sees an opportunity to make the Game Pass model the future of gaming. Rather than buying individual titles, players will pay one monthly fee and have access to a range of titles on either PC, Xbox, or both. With a linked Xbox account also tracking achievements, adding friends, and playing online, the corporation hopes that this will keep players “loyal” to their brand for console generation upon console generation.
There’s a subset of self-professed “hardcore gamers” who vocally lament the decline of physical media in gaming, and it seems to me that it’s predominantly these folks who are upset by Game Pass as a concept – and they always have been. If I may be so bold: they’re dinosaurs, and the way they like to purchase and own games is on the way out. We’ve talked about this before, but there will come a time – perhaps within just a few years – when there will no longer be anywhere to buy physical copies of games. Certainly in the area where I live, most dedicated gaming shops have already closed their doors.
The industry is moving on because players are moving on. The convenience of digital downloads is, for a clear majority of players, something to be celebrated. It began on PC with the likes of Steam, but now it also includes Game Pass as well as other digital shops. The way most players choose to engage with games companies is changing – and that trend shows no signs of slowing down, let alone reversing.
Maybe Game Pass won’t end up being the subscription service that takes the gaming world by storm. Perhaps some other platform will come along to dethrone it, a service that offers more games at a lower price, or one that can – somehow – be available on multiple platforms. But Game Pass is, at the very least, the canary in the coal mine: a harbinger of what’s to come.
When I see folks criticising Game Pass or trying to manufacture stories about how difficult and problematic it is for Microsoft, I feel they’re rather like the old guard of the music industry railing against people taping their favourite songs off the radio, or a DVD retailer trying to fend off the likes of Netflix and Disney+. The way people consume media – all forms of media, gaming included – is changing, and subscriptions are the current direction of travel. That’s not to say it won’t change in the future, but right now, subscriptions are where the entertainment industry is headed.
With the convenience of digital distribution, it’s hard to see a way back. Having tried Game Pass for myself, it already feels like a big ask to go back to paying £50-60 – or more, in some cases – for a single title when there are dozens available on subscription. Even just playing a couple of new games a year is still cheaper on Game Pass than buying them outright. And the more people who sign up, the more that feeling will grow. Rather than whining about Game Pass, other companies need to be taking note.
In the television and film space, we’re firmly in the grip of the “streaming wars,” and that has been a double-edged sword for sure. On the one hand, there’s been a glut of amazing, big-budget content as streaming platforms and the corporations backing them up continue to slog it out, competing for every subscriber. But on the other, the industry feels quite anti-consumer, with too many services charging too much money. Not all of the current streaming services will survive the decade, I am as certain of that as I can be!
But gaming has the potential to be different. Unless Microsoft gives its explicit consent, no other streaming service could set up shop on Xbox consoles, nor could anyone but Sony run a subscription for PlayStation titles. The titans of the gaming industry will continue to compete with one another, but the issue of oversaturation of the kind we’re seeing in the film and television space should be avoidable.
Games companies will have to adapt. Raw sales numbers are already less relevant now that Game Pass is up and running, and they’re going to be of decreasing relevance as time goes on. The way in which developers and publishers measure the success of their titles will have to change as the industry continues this shift – and the companies that get this right will reap the rewards. Those who don’t – or who try to bury their heads in the sand and pretend it’s not happening – will fall by the wayside.
The way I see it, Game Pass is just getting started. 30 million subscribers may seem like a huge number – but it’s a minuscule percentage of the total number of gamers worldwide, so there’s huge potential for growth. There will be competitors that will rise to meet it – but all that will mean is that more players, not fewer, will get roped into long-term subscriptions. We’ve already seen the beginnings of this with Nintendo Switch Online, PlayStation Plus, and even the likes of Apple Arcade on mobile.
It’s mobile phones, more than anything, that I’d argue kicked off this trend. The biggest, fastest-growing gaming platform of the last decade is entirely digital and has been since day one. Players have always accepted digital distribution on their smartphones – because it’s always been the only option. Subscription services are the natural next step – and the only surprising thing, really, is that it’s taken as long as it has for a gaming subscription to become as successful as Game Pass.
The success of Game Pass is not without pitfalls, and as I said the last time we talked about the decline of dedicated gaming shops, it will impact some people more than others. Younger people, people on low incomes (as I am myself), and others will all find that their relationships with gaming as a hobby will change as a result. Not all of these changes will be for the better for everyone, and people who aren’t able to commit to a monthly expense, or who don’t have the means to do so, risk being left behind. But many of those folks are already priced out of the gaming market, especially as companies jack up their prices to unjustifiable levels.
Some of the “hot takes” on Game Pass over the past week or so have taken me by surprise – but in some cases at least, we can look to the “usual suspects” of Sony supporters and die-hard believers in the supremacy of physical media. Stirring up trouble for Game Pass and Microsoft is a hobby for some outlets!
I’m not a defender of Microsoft by any means, and the corporation has made a lot of mistakes. But Game Pass, at least at time of writing in early 2023, feels like a good deal. It has a mix of new games, older titles, and some big releases – like Halo Infinite and Starfield – come to the platform on release day. I’ve discovered games I’d never have thought to try and been able to play games I’d never have purchased entirely because of Game Pass. That undoubtedly means I’m buying fewer brand-new games… but from Microsoft’s perspective, that’s entirely the point.
We should all be vigilant and not simply accept what these big corporations want to do. They’re trying to corner the market and rope players into long-term subscriptions, and they’re doing so not because they think it’s particularly beneficial to players – that’s merely a coincidence. They’re doing it to maximise profits. Not having to split the proceeds with shops or storefronts is a big part of it, and Microsoft would rather take £7.99 a month, every month, than take a cut of the profits on a single sale that it has to share with other companies.
But if this corporate skullduggery is beneficial to players, why shouldn’t we participate? An Xbox Series S or a pre-owned Xbox One combined with a Game Pass subscription is an easy and relatively affordable way into the gaming hobby – offering players a huge library of titles that would be impossibly expensive for practically all of us if we had to buy each game individually. The disadvantages are the ongoing nature of the subscription and the inevitability of titles disappearing from the service either temporarily or permanently. But them’s the breaks – that’s the nature of subscriptions across the board. And with Microsoft doing all it can to buy up companies, more and more titles will be locked into Game Pass for the long-term.
There are reasons for scepticism, sure. But trying to spin this particular issue as a negative one for Xbox and Microsoft is disingenuous. Game Pass was always going to lead to fewer game sales in the long-run. Far from worrying about this, Microsoft’s executives will be rubbing their hands together gleefully… because right now, their plan is working.
Game Pass is available now for PC, Xbox One, and Xbox Series S/X. Xbox, Game Pass, and other titles discussed above are the copyright of Microsoft; other games and titles may be the copyright of their respective studio, developer, and/or publisher. This article contains the thoughts and opinions of one person only and is not intended to cause any offence.