
The UK CMA has posted another document relating to its ongoing Activision Blizzard investigation today, as Microsoft continues in its pursuit to acquire the Call of Duty publisher. This document goes over Xbox's response to making potential 'remedies' to suit all interested parties, and Xbox Game Pass prices are brought up.
In short, Microsoft says that Xbox Game Pass will not go up in price if the merger is successful. The Xbox owner says it didn't do this when Bethesda was acquired, and the potential of making such a move post-ActiBlizz deal is "counter-productive" to the company's plans for the service.
It then goes on to use Call of Duty's annualised nature as an example. Basically, Microsoft thinks that by keeping Game Pass at a lower price, CoD fans would be likely to subscribe for longer, rather than just dipping into the service at the launch of a new Call of Duty title before unsubscribing.
"Game Pass subscribers can cancel at any time after a month of play. As CoD titles are only released once a year, any impact would be short-lived as gamers who exhaust their enthusiasm for the new version of CoD within a few months will churn because of the higher price."
Although not directly related to the pricing of Xbox Game Pass, the next section of the document also provides another plus point for IP such as Call of Duty to be included in the service at its current cost. Microsoft believes that if Xbox improves its Game Pass offering, Sony will improve its PlayStation Plus lineup, thus creating more competition in the service-based marketplace.
The team at Microsoft makes some compelling points here, and we're intrigued to see how well the company will manage to convince the CMA of its theories. The UK authority's ongoing investigation is expected to conclude on April 26th.
Happy to see Xbox commit to its current Game Pass price? Leave your thoughts down below.
[source assets.publishing.service.gov.uk]
Comments 17
What was reasoning of increasing the AAA price point to $70 … costs are increasing…
Sony does not want to have to improve their lineup! Its so unfair to them to have to make their service better when they can just keep blocking games from GP instead!!!
Seriously, I have stated this a thousand times, but should Xbox feel they need to increase the price on Game Pass, the first thing that will happen is simply the elimination of platform-specific plans, retaining only the $15 Ultimate plan for new subscribers, maybe grandfathering older ones until they do any change to their plans.
But the rumors that they are looking for a cheaper, $5 plan, that only adds games after one year, make me think MS is not thinking in that direction at all, but instead to simply keep pushing for growth. Hell, even Netflix is planning to add cheaper ad-supported plans (or did they do this already?)
Like it or not but we are entering the age of “peak gaming” where gamers will have a huge selection of games at a good price point. Similar to where TV was a few years back…
Is that for 10 years too? Can we have it in writing, I'll sign if Sony won't
Call of Duty seems like a weird example to use on this occasion. For the players that solely play Call of Duty it would actually be more cost effective to pay the one off price to purchase the game and then whatever is needed for playing online than paying a sub every month.
Well I’m GPU until March 2025 so locked in there anyway.
Yeah, sorry but theres no way thats true if they are taking 10,000 employees on board and wont be seeing sales from their products moving forward
maybe not immediately, probably remove loopholes first ( ie the gold conversion). Potential to reduce Microsoft rewards value perhaps.
realistic view the price will rise, but probably in small increments.
@Kevw2006 there is a between-the-lines admission here: some Game Pass subscribers subscribe to get a game day one for the cost of a single month, and they end up not canceling the account, likely the first month thinking "meh, still cheaper than buying it" and the same for the third month, and eventually it just annoying to go and unsubscribe and might as well use it.
If the price goes up, the chances of second-month cancelations increases significantly. That is what they are referring to.
@Rmg0731 how do they not see sales from their products moving forward?
Call of duty for example will be more profitable for Microsoft than it was for activision because it will be available to more users like nintendo. Microsoft will be making 70% of every sale of Sony's most popular game.
I think MS is most focused on number growth and avoiding churn. I don't see them raising prices for quite a while as steady revenue with stable if slow growth is more beneficial to them right now than trying to maximize revenue at the cost of volatile churn.
@AlwaysPlaying I think that price hike was a 3-pronged thing. Part of it is "prices are increasing" however I don't think MS necessarily needed or wanted to increase the first party price. My suspiscion here has to do with two other fronts:
First is optics: If the industry has moved to $70 (after Ubisoft announced they moved to the new pricing) keeping MSRP for XGS games lower gives the impression that XGS games are less premium, so to appear to be "at the same level" and not "lower tier" than, say God of War, Starfield has to have the same sticker price as everyone else selling top shelf games.
Second is partners: They're a storefront for all these third party games (Ubi, EA, 2K) and having their own games MSRP undercutting the big games from their publishing partners is very poor business relations with said partners.
Third is: ABK. ABK is the very company that STARTED the entire $70 price thing to begin with before 2k and EA and Sony all jumped in and normalized it. If they're going to take over ABK and start selling the same stuff on other platforms at full price, the pricing is best standardized as the normal going price for their games. Except it's only partly meaningful because:
Forth is: Game Pass. 100% of their games are on Game Pass and pushing the GP subscriber numbers up is their #1 priority. Selling games cheaper than everyone else doesn't help that goal. Selling games for the same price as everyone else and putting them all on the sub does.
@Somebody not if they pull it from other platforms. Also they would lose most sales from their own platform and large chunks from pc with it going to gamepass
Glad to hear it.
@Rmg0731 they clearly arent pulling it from other platforms. They are bringing call of duty to an even wider audience.
They would gain monthly subscriptions which if kept would be more than someone buying one copy. Financially speaking, they would much rather you sub to gamepass than buy a copy of COD.
What a great news! =) the merger need to happen! =)
Rather confusing as that goes directly against the statement Phil Spencer made in October last year that prices for Xbox products and services will likely rise in 2023.
"We've held price on our console, we've held price on games and our subscription. I don't think we'll be able to do that forever... I do think at some point we'll have to raise some prices on certain things, but going into this holiday we thought it was important to maintain the prices."
They would, but I don’t believe they are even close to hitting their subscriber projections for this time. Game Pass is cool, but there’s a lot of room for improvement - if it gets back on course to hitting the sub numbers they thought it would, it will 100% start creeping up towards $20 point. I think Netflix really taught everyone a lesson about squeezing your customers with sub prices during economic down times.
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