Xbox Confirms Game Pass Leads to “Drop” in Sales

Picture: Xbox / Kotaku

As Microsoft continues its year-long journey to consume Activision Blizzard Kingwe are learning more and more about the inner workings of the various companies involved. And today, about the UK Competition and Markets Authority‘s preliminary report on the deal, we learned that games added to Xbox’s Game Pass service tend to see a decline in sales for about a year afterward. This isn’t the most surprising news, but it seems to clash with previous statements from Xbox boss Phil Spencer.

Launched in 2017, Xbox Game Pass has become one of the company’s biggest successes, helping it grow beyond its consoles and add millions of new customers. For a relatively small monthly fee, subscribers get access to a huge catalog of Xbox and PC games, as well as other benefits such as: B. Discounts on DLC and the ability to stream a range of games. Naturally, when it first launched, some wondered if its Netflix-like structure would result in fewer people buying games. And it appears, based on Xbox’s internal data, that this is indeed the case.

As discovered by GamesIndustry.bizburied deep a new report from the UK CMA is a small update from Xbox on how Game Pass is affecting game sales. The report says:

Microsoft also stated that its internal analysis shows a (redacted) percentage drop in base game sales 12 months after their inclusion on Game Pass.

The report notes that Microsoft’s data has “some limitations,” particularly with regard to the period Microsoft appears to have used for its internal tracking. However, Xbox itself admits in internal documents that adding games to the service would lead to “cannibalization of (digital) sales”.

Xbox previously claimed that Game Pass increased sales

Now this seems to conflict a statement made by Xbox boss Phil Spencer in 2018, about a year after the launch of the service. At the time, Spencer said sales increased as the games hit Game Pass.

“If you bet a game like ForzaHorizon 4 On Game Pass, you immediately have more players of the game, which actually translates into more sales of the game,” Spencer said. “Some people have questioned that, but when state of decay 2 You saw – if you looked at the NPD in the US – that this game sold really well in the month it was released on GamePass.

Also in 2018 while talking to Giant Bomb during E3Spencer specifically named two games— Sea of ​​Thieves And state of decay 2— sold better than the company had predicted, despite both titles being available on Game Pass.

Of course, both answers are from 2018. Things are changing and it’s possible that with more data the Xbox has seen revenue declines more frequently, especially since the service has grown so much since those early days in 2018. There is still evidence from 2020that some games are experiencing sales increases due to Game Pass. So, as you might expect, this is a complicated subject. kotaku has asked Microsoft and Xbox for clarification.

Interestingly, the CMA report also notes that Activision has not historically been very keen on including its games in Game Pass or any other platform’s subscription service, according to Microsoft. Why? Well, Activision believed this could “severely cannibalize” game sales, especially when it comes to big new releases. But based on previous comments from Xbox and Spencer, it doesn’t matter if the deal is final. Activision games, big and small, will eventually go to Game Pass.

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