Xbox exec says Microsoft wants to bring Game Pass to PlayStation and Nintendo

videogameschronicle.com:

Xbox’s chief financial officer has said the company eventually wants to bring Game Pass to PlayStation and Nintendo consoles.

Tim Stuart told attendees at the Wells Fargo TMT Summit that the company’s ultimate goal is to bring all of its content and services “to every screen that can play a game”.

This “mission” is designed to reap higher profits from Microsoft‘s gaming division than has traditionally been the case with its relatively low margin console business, the exec said.

And it was one of the motivating factors behind the company’s $69 billion acquisition of Call of Duty creator Activision Blizzard, which it completed last month.

“For us, when we think about the business, gaming as it relates to Microsoft and with Activision, operating leverage and margin expansion is definitely a piece of that puzzle,” Stuart said.

“At the highest levels, you go from what was a lower margin third-party entity that we sold on our store to a high margin first-party business, so when you think about the Xbox component of Call of Duty, you go from that low margin business to a high margin business. Then what you do is you also expand and say, we’re now driving high margin sales on PlayStation, on Nintendo.”

Prior to its purchase of Activision Blizzard, Microsoft agreed 10-year deals to bring Call of Duty to Nintendo platforms and to keep it on PlayStation consoles, should the acquisition be approved by competition regulators.

“And that’s really, lastly, where we’re going in this business, is that expansion of operating leverage, where we think about placing our bets,” Stuart added. “First-party, subscriptions, advertising – those are all high margin businesses that we want to expand into.

“And what you’ll hear from us more and more is a bit