When Microsoft announced Game Pass in June 2017, another monthly subscription service was headed for dramatic extinction. It was MoviePass, which reduced its subscription price from $50 to $9.95 per month. Suddenly, subscribers could see a movie every day of the month for less than the cost of a single ticket in most cities. It was obviously too good to be true, and millions of people happily enjoyed it while MoviePass hemorrhaged money and tried to heavily weaponize the movie industry in a deal that would save it from it- same.
It was great while it lasted.
Now five years later, Microsoft’s Game Pass is well past the possibility of dramatic extinction. It’s a proven success: there’s no reason to worry about Game Pass shutting down soon, as more than 25 million subscribers pay monthly to access hundreds of games. If you are an active gamer with varied tastes, this is the best game deal.
Like MoviePass, I think Game Pass is too good to be true too, but on a much longer timeline. It won’t be a fire. Instead, it will get a little worse as we continue to pay for a subscription that seems as universal as water or Netflix. An industry analyst recently suggested there’s no reason to worry about a future where gaming is dominated by a Netflix-like service, but I think Game Pass could possibly mirror some of the worst aspects of recent Netflix history.
A price spike is (almost) inevitable
Game Pass is still in its subscriber building phase, with immediate profit being secondary to attracting new users. That doesn’t mean he’s burning money though: in a November 2021 interview, Phil Spencer said Game Pass is “very durable as it stands today”. We could argue anything is sustainable in a business worth over $2 trillion, but let’s assume Game Pass is profitable or gets there. Microsoft will be fine; the far more likely outcome here is that Game Pass becomes a worse deal for subscribers over time.
In 2014, Netflix cost $8.99 for a standard subscription and $11.99 for a premium subscription; since then the price has increased five times and is now at $15.49 and $19.99. It has almost doubled in less than a decade. Inflation can’t take that into account: the 2014 price rises to about $11 in 2022, according to the US Bureau of Labor Statistics’ Inflation Calculator.
So far, the price of Game Pass hasn’t increased by $10, although Microsoft has added a $15 premium tier in Game Pass Ultimate, which includes Xbox Live Gold, cloud games, and more. But like any publicly traded company, Microsoft needs to make more money every year, and Game Pass accounts for a big chunk of its Xbox revenue. A price increase seems almost inevitable once Microsoft has enough subscribers hooked to its library.
Xbox Live subscribers had a fit when Microsoft tried to dramatically increase the price of Xbox Live in early 2021, so the company quickly backtracked. Next time, Microsoft will probably raise its subscription prices like it’s boiling a metaphorical frog: slowly and steadily, and no one gets too alarmed. The only reason Microsoft might keep Game Pass cheap is because the company gets a 30% cut from every digital purchase on Xbox – the profit of keeping more people in the ecosystem could outweigh the increased Game Pass price (and the inevitable loss of a few subscribers). But let’s be real: Microsoft will want to make more money both ways.
Things are getting worse for developers
During the first two years of Game Pass, indie developers praised Microsoft’s offerings to bring their games into the library. Their games might end up being profitable even before they were released, and Game Pass didn’t seem to negatively affect the number of copies sold elsewhere. I asked an independent publisher if good deals to include in Game Pass were still common. “The general consensus is that [Game Pass deals] are always good,” they said.
Maybe that will continue to be the case for years to come, but it will always be in Microsoft’s interest to prioritize the games that the most subscribers play. In the long run, this goal probably won’t sit well with creators making games that land outside of certain demographics. It’s also less likely to mean renewing deals for games that have already spent time in the Game Pass library, rather than bragging about new additions.
It’s become a major sticking point with Netflix, which aggressively cancels shows after a season or two, even if they’re doing well. The creator of The Baby-Sitters Club, which was canceled after two seasons despite having “much bigger numbers” than HBO shows like Succession, said it looks like “Netflix’s internal measures may change from one month to month”. Financially, it makes more sense for Netflix to kill shows that make fine spend money on a new show that could potentially generate new subscriptions instead.
The industry analyst who spoke about Game Pass at GDC wondered if the mix of first-party games and other major franchises would lead to an “increasing compression” of smaller games in terms of discoverability. , and if “the conditions for acquiring or setting up these games in [Game Pass] starting to deteriorate.” With all of the production from Bethesda, Activision Blizzard, and its other first-party studios on Game Pass, Microsoft could possibly maintain a healthy subscriber base in the future without worrying about outside games at all.
No one is happy with the state of streaming TV these days, with shows and movies split between Netflix, HBO Max, Disney+, Hulu, Amazon, Apple TV+ and (hiss) Paramount+ and Peacock . And that’s before you even step into boutique streamers like Criterion and Shudder. That wasn’t always the case: In the early years of streaming, Netflix secured huge amounts of shows and movies at low prices because the networks didn’t have their own streaming platforms. Now NBC wants you to pay $5 a month just to watch The Office.
So far, gaming hasn’t seen such an obnoxious spread from subscription services, but a few publishers have dipped their toes. Ubisoft has Ubisoft+, and EA has EA Play, which currently also comes with Game Pass. Sony’s upcoming rival subscription program is already bad news for PC gamers, driving up the cost of PC game streaming, and it’s easy to see Game Pass’s growth inspiring more competition down the road to Take. Two or Epic or Square Enix or Tencent or Embracer Group.
Even if the same obnoxious burst hits gaming subscription services, it won’t be as boring as with TV and movies – games are still easy to buy on day one, which often isn’t at all an option with Netflix shows. But there are still all sorts of potential futures where subscription services make the game worse:
- Game Pass loses its best third-party games to competing services
- Publishers require subscriptions to get early access a week before you can buy a game, like EA did with EA Play
- Playtime metrics encourage boring, grumpy games
- More levels appear to access great games or expansions
- “I’ll wait for it to be added to a sub” starts to hamper direct sales
- NFTs ruin everything, one way or another
Game Pass on PC remains hopelessly limited
Game Pass has been on PC since 2019, and in that time it’s gotten a little better. The game selection was solid from the get-go, but the Xbox app used to access it presented many frustrations. It was better than the Microsoft Store, but still slow and operated in that store as a backend. The games were packaged differently from their Steam counterparts and often had unique performance issues or other drawbacks that went unresolved.
It took until March 2022 for an Xbox app update to allow us to choose a custom game install folder and add mod support, but that mod support remains spotty. and buried, a far cry from dead steam workshop modding or hands-off simplicity. DRM-free games from GOG.
PC Game Pass’ flaws were easier to forgive when Microsoft first launched it in beta. But the app is still bloated and clunky; it’s really weird that the company that makes Windows is responsible for the worst applications and not the best. Three years ago, I was more optimistic that we would see regular cross-play between Game Pass versions of PC games and Steam versions, and that Microsoft would move quickly to improve the app used to launch the games. PC Game Pass has improved, but much more slowly and sporadically than I expected.
Since 2019, meanwhile, Valve has made a ground with Steam, launching Proton for Linux compatibility, redesigning the store experience and library and download manager, creating a test play feature for developers, and extending remote streaming. Its friends list and invitation system remain well ahead of Microsoft’s Xbox Live integration, although, again, Microsoft makes Windows.
It’s a place where Netflix isn’t a great analogue for Game Pass, but Amazon Prime Video is: the mere thought of starting up this sluggish, ad-filled, horribly designed app is enough to make me want to watch something. on another stream. service instead.
The analyst who recently spoke about Game Pass at the Game Developers Conference predicted that subscription services will only account for 8.4% of the total gaming market by 2027. Currently, they represent approximately 4%. So it’s not like the near future of gaming is going to mirror TV or music streaming or share identical pitfalls – I’m certainly not worried about Game Pass removing ownership of the game. Game Pass remains a Amazing offering at the moment, but the eventual push for more revenue and a curated library of the most enticing games looms over it.
And at least on PC, I find myself less and less interested in subscribing plus the app is just a worse way to play games than I could get on Steam. The novelty of the huge, cheap library has worn off enough for me to focus on specific games, and I can often buy them for a month’s subscription instead.