Before Netflix and Spotify successfully rolled out a model of streaming media content for users through a subscription-based service, Xbox Game Pass should begin as a video game rental platform.
Speak with British GQ, said Microsoft’s Head of Gaming Ecosystems Sarah Bond that the Xbox Game Pass may originally have looked a little different. The studio’s decision to start as a streaming-based subscription service was due in part to the successes of other companies using the model – converting a rental service, codenamed Arches, to the game subscription service we know as Game Pass.
It also helped the company build on another phenomenon in the industry – the longer duration over which games generated revenue. “In the first two months after its release, about 75 percent of a game’s revenue was generated,” explains Bond. “Nowadays it’s spread over two years.” Game Pass allows the company to offer the games themselves at an attractive price to players while keeping add-ons or other transactions valuable after launch.
Bond further revealed that the idea of a video game subscription service initially met with strong opposition from publishers who believed Game Pass would devalue games. When Xbox first launched Game Pass in June 2017, it started off with a series of low-risk older games that publishers had given the studio access to to test how profitable the service actually would be.
According to GQ, Xbox found that player engagement exceeded all of its estimates – a factor that ultimately led the company to release an Xbox Studios project, Sea of Thieves, on the platform, coinciding with its launch for larger ones Retailers and continued success so far, and encourages them to bring all new first-party games to the service as well as gain support from publishers.
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Earlier this year, Microsoft CEO Satya Nadella confirmed that Game Pass has amassed over 18 million subscribers. Subsequent reports from Microsoft suggest that growth slowed over the course of 2021 to remedy the situation.
Jared Moore is a freelance writer for IGN. You can follow him Twitter.