Phil Spencer reveals that the Xbox Game Pass is doing like a charm, and takes an important place in Xbox’s economic project.
We know it and we’ve seen it for a few years now, Microsoft favors services over hardware when it comes to gaming. Xbox Game Pass has an excellent reputation since it stands out as the most profitable and advantageous subscription for players. So we’re only half-surprised to learn that the service is a pretty big chunk of Xbox’s economy.
In effect, the Game Pass represents a total of 15% of revenue from Microsoft’s gaming arm, and is now officially profitable for the company. This is an extremely important step for the firm which can now count on a solid and stable subscriber base to ensure a regular and almost permanent income, after having spent astronomical sums in securing exclusives and renting games. third party for its catalog. Xbox CEO Phil Spencer says:
“Game Pass, as an overall share of our content and services revenue, is probably 15%. I don’t think it gets more important than that. I think overall revenue is going up, so 15% of a bigger number, but we don’t have that future where I think 50-70% of our revenue is from subscriptions.”
Present on almost all consoles
If the current result and performance of Game Pass is more than satisfactory, the room for improvement is almost non-existent… at least on consoles. Indeed, Phil Spencer estimates that the vast majority, if not almost all, of Xbox gamers already have an Xbox Game Pass subscription, so there aren’t many gamers left to convert. The only possibility for Microsoft is therefore to focus its efforts on converting classic subscriptions to Ultimate formulas, which are more expensive and more complete, as well as on PC players, who are multiplying launchers and ways to play.
The businessman therefore specifies that the firm knows “incredible growth on PC Game Pass… On console I’ve seen the growth slow down, mostly because at some point you’ve reached everyone who wants to subscribe.” To get more subscribers, Microsoft will have to sell more consoles. But with what he is preparing, it will not be an easy task.
The company has just announced that the price of its Xbox Series X / S should increase in the coming months, but did not say by how much. This follows the PS5 price increase announced by Sony several weeks ago. If inflation continues to play its part, Phil Spencer foresees an increase after the end of the year celebrations in order to give his players some respite.