Xbox clarifies its own admission makes Game Pass cannibalize some game sales
Microsoft has clarified its own admission that putting games on Xbox Game Pass could, in some cases, lead to decrease in sales. In response to many recent headlines about the cannibal effect on Game Pass releases, Microsoft has shed more light on the matter.
In a statement to GameSpot, a Microsoft spokesperson said Microsoft is trying to help game developers make as much money as possible through Game Pass. As a result, Microsoft cuts deals with developers and publishers on a title-by-title basis, terms not being made public and perhaps inconsistent across the board. In its statement, Microsoft did not specifically comment on any cannibalistic effects, but it also did not say that this will never happen.
Given the size and scale of Xbox Game Pass, the custom financing arrangements for each game, and all the other potential contributing factors, it seems likely that some Xbox Game Pass titles will be impacted by sales. number of the entire game when included in the Game Pass . However, in other cases, game sales may increase over time due to inclusion in Game Pass.
Microsoft has submitted to the UK’s Competition & Markets Authority that a certain percentage (readjusted) of base game sales declined 12 months after being added to Game Pass.
“We are focused on helping game creators of all sizes maximize the total financial value they receive through Game Pass,” said a Microsoft spokesperson. Each game is unique, so we work closely with the creators to build a customized program that reflects their needs, ensuring they are financially compensated for joining the service, and facilitate creativity and innovation. As a result, the number of developers interested in partnering with Game Pass continues to grow.”
The statement continued: “Xbox Game Pass gives players and game creators more choice and opportunity in how they discover, experience, and deliver games. For players, that means what that means. providing another option for them to explore games and play with friends at great value.For developers, that means creating another option for how they monetize their games. .”
Microsoft Gaming CEO Phil Spencer himself has spoken openly about the fact that there is no definite path to deals the firm creates for Game Pass releases. I said precipice that Microsoft’s Game Pass offers are “everywhere” and he understands that this sounds “unmanaged”. In some cases, Microsoft will finance the game development costs entirely, and the studio can sell their games on rival stores like PlayStation and Steam or at a retail store, while Microsoft benefits. from having another Game Pass game. “For them, they have protected themselves from any downside risk. The game will be made. Then they have all the retail offers, we have a daily chance. That will be. is a flat fee payment to the developer,” he said.
In other cases, a game might end and then Microsoft make a direct cash deal to put that game on Game Pass, Spencer said. Other transactions, however, relate to the usage and monetization of a game through in-game sales. If this all sounds like the Wild West, that’s because it is.
Spencer has frankly admitted that Microsoft doesn’t have all the answers. “Multi opening [to] tested with different partners, because we don’t think we figured it out. When we started, we had a purely usage-based model. Most partners say, ‘Yes, yes, we understand that, but we don’t believe it, so give us the money first,'” he said.
Descenders indie game saw its sales quadrupled such as after it appeared on Game Pass. Of course, there could be some confirmation bias here, as developers aren’t really willing to share stories of how poorly their games sold after coming to Game Pass. It’s reasonable to assume that, of the hundreds of games on Game Pass, not all have been successful.
The The economic realities of Game Pass may never become clear, in part because Microsoft won’t (of course!) publicly share the terms of its agreements with developers and publishers. At a higher level, Microsoft don’t even reveal Xbox console sales numbers anymoreas the company instead focuses on non-obvious “interactions” metrics that can be aligned and positioned to Microsoft’s interests.
New commentary around Xbox Game Pass is about to come to light as Microsoft sends documents and interviews to regulators around the world, including the CMA, as it tries to help placate the fans. manager and get The $68.7 billion acquisition of Activision Blizzard has been approved.
The products discussed here are independently selected by our editors. GameSpot may receive a share of the revenue if you purchase anything featured on our site.