Microsoft has responded to the FTC allegation regarding the Xbox Game Pass price hike bringing “consumer harm”.
Recently, the FTC in the US had submitted a formal complaint letter about Microsoft’s recent price hike of Xbox Game Pass subscriptions to the US Court of Appeals. As per the regulation authority, the price hike is “exactly the sort of consumer harm from the merger the FTC has alleged”. Today, Microsoft has responded to the allegation by stating that it is “wrong” and “misleading” to refer to its revised Xbox Game Pass tiers “degraded”.
The letter from Microsoft pointed out that FTC’s allegation presented a misleading account of the facts and attempted to reinvent its case on appeal. The company had announced changes to its Game Pass subscription, introducing a new service tier, Game Pass Standard, for $14.99 per month, offering back-catalog games and multiplayer functionality. This is accompanied by the discontinuation of Game Pass for Console, which lacked multiplayer functionality. The pricing of Game Pass Ultimate will increase, and it will come with new games available “day-and-date,” including Call of Duty.
Microsoft criticized the FTC’s focus on the theory that the software giant would withhold Call of Duty from Sony’s consoles. It was rejected by the district court, and a contract ensuring that Call of Duty will remain on PlayStation further eroded this argument. The company stated that the FTC’s shift to the alleged subscription market is not supported, as Call of Duty is not being withheld from anyone. Additionally, Sony’s subscription service continues to thrive, according to the software giant. Microsoft further argued that the Activision Blizzard King acquisition benefits competition and consumers, as the district court found.
As for the delay period for bringing first party games to the cheaper Game Pass Standard subscription tier, it is said to vary on a case by case basis.
