Xbox confirms the Game Pass model impacts long-term game sales

Subscription service takes a bite out of game sales

Xbox has confirmed that the launch of its hugely successful Xbox Game Pass subscription service has had a notable negative impact on the long-term sales prospects of many of the titles added to its rotating catalog of games.

The admission comes as part of a report by The UK Competition and Markets Authority, (as seen by GamesIndustry.biz) which was commissioned as part of Microsoft’s proposed purchase of publisher Activision Blizzard. According to the report, many titles that were made temporarily available in the Game Pass service then saw a decline in physical/digital sales for the 12-month period following their removal from the service.

The average percentage by which sales have declined was redacted from the record.

While it would make sense that players would leap on the opportunity to play the latest games as part of their subscription, rather than roll out $30-$60 elsewhere, the admission is notable as it contradicts previous comments by Xbox head of gaming Phil Spencer, who had suggested that adding a title to the Game Pass service boosted its long-term sales, rather than reduced them.

“When you put a game like Forza Horizon 4 on Game Pass, you instantly have more players of the game, which is actually leading to more sales of the game,” Spencer told GI.biz back in 2018. “You say, ‘Well isn’t everyone just going to subscribe for $10 and go play this thing?’ But no, gamers find things to play based on what everybody else is playing.”

But it seems, according to the CMA’s report, that the numbers themselves are proving quite the opposite.

Meanwhile, Microsoft’s ongoing efforts to purchase Activision Blizzard continue to face various legal barriers from statutory bodies all over the globe. Firstly, the publisher will have to deal with its upcoming lawsuit with the U.S. Federal Trade Commission (FTC), before then attempting to find favor with its European counterpart, the European Commission. The situation is a very long way from closure.

Microsoft confirms Game Pass cannibalizes sales [GamesIndustry.biz]