Adding titles to Game Pass “severely cannibalizes buy-to-play sales”

techradar.com:

The UK Competition and Markets Authority (CMA) is currently investigating Microsoft on its acquisition of Activision Blizzard. This inquiry has brought to light some interesting details about Xbox Game Pass and its viability. 

Game Pass is Xbox’s subscription service that lets subscribers play a wide variety of games for only $10 / £10.99 / AUS$15.95 per month. While the debate as to which gaming service is better, Game Pass or PS Plus rages on, it’s safe to say that Xbox’s system is nothing to turn your nose up at.

With over 100 games available for a small monthly fee, more than 25 million players take advantage of Game Pass, whether it be on a Xbox Series X|S or Xbox One. However, this popular service may be great for players, but less suitable for business. 

“Microsoft also submitted that its internal analysis shows a [redacted]% decline in base game sales twelve months following their addition on Game Pass”, the CMA said in its report(opens in new tab). 

Elsewhere in the same report, the CMA includes information about the shortcomings of a multi-game subscription service. Game Pass “severely cannibalizes buy-to-play sales, particularly in the case of newer releases,” the CMA said.  

This report by the CMA contrasts previous comments made by the CEO of Xbox Games Studio, Phil Spencer. Back in 2018, Phil Spencer said that putting games on Game Pass actually boosted sales in an interview with levelup.com(opens in new tab). 

Spencer equated Game Pass to free publicity, concluding that if people play a title on Game Pass, word of mouth will circulate, and players will be more likely to buy it for themselves if they don’t subscribe to Xbox’s service. 

“Some people have questioned that”, Spencer said. “But when State of Decay 2