Microsoft’s premium game subscription service, Xbox Game Pass, costs the software giant more than 1 billion US Dollars each year in order to bring new games to its catalog.
During an interview with Bloomberg (via), Xbox President Sarah Bond talked about the future of the platform with regards to handheld consoles and subscription-based gaming. In doing so, she revealed that Xbox Game Pass costs Microsoft more than 1 billion US Dollars every year in order to bring new titles to its game catalog.
Bond stated that Xbox Game Pass was a major adjustment for publishers. According to her, in order to sweeten the deal, Microsoft now spends 1 billion US Dollars a year to get third-party games on the subscription service. She said that this generosity has successfully attracted smaller publishers by offering them upfront payments worth millions, as well as a share of the subscription revenue and the opportunity for exposure that they may not have been able to achieve on their own.
However, developers have expressed concern over the behavioral shift with respect to consumers caused by Xbox Game Pass, which has resulted in very few sales on Xbox consoles. Skill Up associate Edmond Tran recently had the opportunity to interview a series of anonymous game developers, and this was the overall takeaway. The general sentiment among developers was that the existence of Xbox Game Pass has created a vicious cycle.
One such developer released an award-winning title on Xbox more than two years ago after initially releasing on other platforms. They mentioned that their game’s sales on Xbox have been the weakest. “It’s a bit like trying to sell a DVD to someone who uses Netflix. Sure, people still do that from time to time but you’re not targeting the right audience”, they said. For further details, follow the link here.
