This Week in Games is a weekly column where Vikki Blake pulls apart the biggest stories in gaming each week. This week, she addresses the industry’s growing uneasiness about Xbox Game Pass and similar subscription services.
For us, it’s a bit of a no-brainer. Instant access to hundreds of video games, including some of the very latest releases from some of the world’s biggest studios – for a tenner a month? Uh, yes, please. Though it’s taken the games industry a wee while to catch up with the idea of a Netflix-style subscription service for games, now they’re here, every AAA publisher seems to be jumping on the bandwagon, and they’re becoming hugely popular – not just with the players, but with developers looking to bring their games to huge new audiences, too.
Are there already too many of them? Probably. I’m signed up to Xbox Game Pass Ultimate and PS Plus – yes, I intend to join the refreshed service when it launches next month – and the former includes a dollop of EA Play as a delightful bonus. (I also subscribe to the Nintendo Switch Online Expansion Pack thing, but only because I was going to buy the Animal Crossing: New Horizons‘ DLC, anyways). Add in the others, though – Ubisoft, Apple Arcade, Nvidia GeForce, Google Stadia; bloody hell, there really is a lot, isn’t there? – and it gets hard to justify the expense, especially as we grapple with one of the worst cost of living crises since records began.
One or two, though? Twenty quid a month, perhaps, less than half the cost of a AAA blockbuster? I repeat: it’s a no-brainer, really.
Not everyone’s a fan, though. Former Xbox exec Ed Fries said earlier this week that Xbox Game Pass “makes [him] nervous”, equating its potential impact to that of Spotify’s game-changing – and highly controversial – influence on the music business.
“The one thing that [Microsoft is] doing that makes me nervous is Game Pass,” Fries said, reflecting on what he may have done differently had he still been working at Xbox. “Game Pass scares me because there’s a somewhat analogous thing called Spotify that was created for the music business.
“When Spotify took off it destroyed the music business, it literally cut the annual revenue of the music business in half,” he added (a fact contested by some, who opine it was piracy that slashed revenue, not streaming; but I digress). “It’s made it so people just don’t buy songs anymore […] we have to be careful we don’t create the same system in the game business.”
It’s a compelling statement – and it certainly hit the headlines – but gaming subscriptions aren’t quite the same thing as Spotify, though; not yet, anyway. Microsoft’s Game Pass arguably leads the charge when it comes to the sub services, and it currently sports 25million subscribers. That’s not to be sniffed at, obviously, but it’s a long way off Spotify’s 182million, or Netflix‘s 222million, not least because all subscriptions – yes, all the ones I listed above, as well as the ones I didn’t – account for just four per cent of the annual video game spend in Europe and North America as at January 2022. That leaves a whopping 96 per cent of video game revenue that doesn’t come from subscriptions.
And look, I’m not an industry analyst – numbers scare me and graphs make me break out in a sweat – but from my lowly position way down here in the gutter, I’d say that’s because the gaming industry has uniquely devised many, many other ways through which to fleece its audience already.
We already have to contend with battle passes, expansion packs, DLC, “cosmetic” skins, microtransactions and – the latest fad – NF-fucking-Ts, without adding subscription services on top. Even if you don’t subscribe to game libraries like Xbox Game Pass, you still need Xbox Gold Live or PlayStation Plus if you ever feel like joining a pal online.
Sure, individually, this stuff may be equivalent to “just a couple” of take-out coffees a month, but collectively, I suspect we may be shelling out more than we first think. And even if you buy a game outright – even a physical copy! In your actual hands! From a real-life shop! – there’s no guarantee that you’ll still be able to play it in two years time; live-service games that dip below investor expectations are getting shuttered left and right. The sad truth is we rarely “own” our games these days; read the small print, and you’ll see most of the time, you’re just buying permission to play them.
The DLC and the season passes and the rest of it? That’s where the other 96 per cent of gaming revenue comes from, and that’s why I don’t think the gaming industry has to worry about the impact of a dip in sales – or even quality – of games just yet. No, that doesn’t mean Fries’ concerns are unjustified… but they may be unnecessary, at least for now.
Vikki Blake is a freelance journalist and columnist for NME – check out the rest of her This Week In Games column here.