I think we can all pretty much agree that Xbox Game Pass is ridiculously good value. Ridiculous to the point where it would be absurd to not have it, or at the very least, try it. Even more bewildering then, that Xbox can offer the subscription service for £1 a month for multiple months at a time.
The last time I paid full price for Game Pass was last year, and my subscription has only just run out. It’s an incredible package and worth an article in itself of how Xbox has won in terms of offering a Netflix-style subscription service that outdoes any of its competitors.
One thing has me confused, however, in terms of the financial specifics of the service. For one, I’m not entirely sure how Microsoft pays for the games on Game Pass. Secondly, how then do they make any money on their exclusives when they’re all coming to Game Pass at launch? Or in the case of the game that I’m talking about, launching 4 days earlier than the retail release.
Gears 5 is a highly anticipated title for the franchise and Xbox gamers in general since there’s a draught of exclusive games on the platform. We’ve known for a while that all first-party games for Xbox will be launching on Game Pass from day 1. I’m not sure we knew, however, that the ability to play a game early would be available for one of the biggest and last launches of this generation.
I for one like to support the developers and publishers as directly as possible when I am financially able to. Yet, Xbox is encouraging me to not buy Gears 5, even though that might benefit The Coalition and their short-term revenue stream greatly.
Instead, like many other gamers, they’re insisting on me playing the game through Game Pass. Which I bought for £1 about three months ago. For three months. Not just because they’re releasing the game earlier on Game Pass, but because it isn’t even the standard edition.
You can play the Ultimate Edition of Gears 5 4 days early, with bonus characters from Halo: Reach and the upcoming Terminator film, for essentially £1 with Xbox Game Pass Ultimate. Xbox Game Pass Ultimate also includes your Xbox Live Gold Subscription within the package, FYI.
It just seems backwards to me that Xbox is not only able to offer Xbox Game Pass as a service financially but to also offer this incredible deal for a first-party game that is being played more on Xbox at launch than Fortnite. And yes, this is a direct cause from Game Pass because it’s the Ultimate Edition that is being played more than Fortnite, not the standard edition.
You might be thinking, ‘well, isn’t it good for The Coalition that so many people are playing the game?’ Yes, it’s great to see the game doing this well for a franchise that people were doubting both culturally and commercially. But I would argue that many of those copies could’ve been sold for £50.00 at retail because many people would’ve been willing to buy the game anyway.
But since most Xbox gamers (at least, Xbox gamers that I know) have Game Pass anyway, why would they spend an extra £50.00 for a game that they own already? It’s a complicated situation because I don’t know the numbers.
The people working behind Xbox are smart. They’re looking at the numbers, and the numbers work. From a player point of view, I just can’t believe that they don’t need that lump sum of revenue from the retail purchases that badly, even when they’re offering Game Pass at an impossibly low price.
UPDATE – the numbers have come in, and although Gears 5 reached millions of players at launch, Gears 4 sold 4.5 times better at launch. This cannot be good news for the Coalition. Clearly, the tactic here is to get people in for free (or nearly free) and for them to purchase microtransactions. Hundreds if not thousands of them. Just as the Battle Royale genre generates its revenue.
Moreover, it illustrates that when Phil Spencer talked about investing in the first-party studios they own, he wasn’t kidding. But is this investment meeting its return?