‘Call Of Duty’ Reportedly Loses $300 Million In Sales As Microsoft Increases Xbox Game Pass Price
Microsoft has had a hell of a week in gaming, and none of it good. After raising the price of their Xbox Game Pass Ultimate tier by 50%, the subsequent outcry, insider sources claimed Call of Duty lost $300 million in physical sales by being on the subscription service. While that should mean more people are playing the game on Game Pass, those sources claim Game Pass isn’t making the profit Microsoft hoped it would.
Announced at the start of the month, Microsoft praised the Game Pass service, adding, “but we have the opportunity for Game Pass to help more players find the creators and games they love. We know not everyone wants the same thing in their Xbox experience, so we’re evolving Game Pass to offer more flexibility, choice, and value to all players.”
In summation; PC games can now be accessed on Xbox at tiers lower than the “Ultimate” tier, all tiers having access to cloud gaming (higher tiers having shorter wait times), and other benefits to lower tiers (“Core” and “Standard” now being called “Essential” and “Premium”).
However, the biggest shock was the price change to the Ultimate tier.
While Xbox Game Pass Ultimate was $19.99 a month, it is now $29.99 a month. Microsoft justified this by offering access to over four-hundred games, over seventy-five day one releases a year, access to Ubisoft+ Classics and EA Play, access to Fortnite Crew in November, the “best quality” cloud gaming with shortest wait times, and being able to earn up to $100 in rewards per year.
Gaming show producer and presenter Geoff Keighley taking to X to highlight that this was a 50% increase only helped the fact go more viral. This led to several unverified reports on X that the webpage for cancelling your Xbox Game Pass subscription had crashed shortly after the announcement; presumably due to high traffic.
Furthermore, videos on the Xbox YouTube channel have seen a dramatic increase in number of Dislikes and comments disparaging the state of Game Pass, even for videos unrelated to Game Pass (such as trailers for games). Said Dislikes can only be seen via third-party plugins.
Even GameStop weighed in, mocking Microsoft by saying folks would be coming back to them, and offering a month of Xbox Game Pass Ultimate for the original $19.99. Days later it was rumored and then confirmed (despite not being in the initial announcement) that Microsoft had dropped the 10% DLC discount for Game Pass titles.
Speaking to IGN, Microsoft stated, “This is not specific to any one game and reflects all games and DLC purchases.”
“Instead of a discount on the purchases, Ultimate and Premium subscribers will earn 10% and 5% — respectively — in points when purchasing select games and add-ons from the Game Pass library. Ultimate members continue to have 20% discount on select games from the Game Pass library. On top of that, all Rewards members will earn points when shopping games and add-ons on the Store, while Premium and Ultimate subscribers will earn even more, 2x and 4x respectively,” including a link that provides readers with further details regarding the Game Pass Rewards program.
Speaking to The Verge, Dustin Blackwell (Microsoft’s Director of Gaming and Platform Communications) further highlighted the added value of the Ultimate tier, such as Fortnite Crew and Ubisoft+ Classics “combined add about $28 a month in value to Ultimate subscribers.”
Blackwell also attempted to smooth over the new Game Pass cost other upcoming Xbox price increases; such as Xbox console prices raising in the US, and the ROG Xbox Ally and Ally X costing $599.99 and $999.99 respectively.
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“We understand price increases are never fun for anybody, but we’re trying to reinforce by adding more value to these plans as well. It’s something we don’t take lightly, and we’re listening to the feedback of players and the community to try to provide them with more of what they’re asking for,” Blackwell insisted.
Gamers have gotten plenty more information to provide “feedback,” thanks to Cecilia D’Anastasio of Bloomberg. Along with their sources, they highlighted Game Pass’s failure to meet Microsoft’s expectations, and the frustrations this has caused internally.
To start, Game Pass’s growth rate has reportedly slowed down since the COVID-19 lockdowns — from 80% between 2020 and 2021, to 36% between 2022 and 2024. The last time Microsoft shared their figures (February 2024), they confirmed there were 34 million Game Pass subscribers.
They also insisted the service was profitable, at nearly $5 billion in revenue in their fiscal year ending June.
Nonetheless, “according to interviews with seven current and former Xbox employees,” Game Pass and streaming isn’t generating the revenue it wants, even eight years after launching. All after putting big titles on Game Pass, and cutting into their sales (according to the sources who requested to remain anonymous).
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Bloomberg’s sources (including “one of the former employees”) claim Call of Duty lost $300 million in sales on PC and consoles by being on Game Pass. For comparison, 82% of Call of Duty Black Ops 6‘s full dollar sales were on PlayStation 5.
Obviously, those on Xbox would likely play Call of Duty Black Ops 6 via Game Pass. Though, that is the point, as Game Pass hasn’t turned enough profit in exchange. “According to former employees with knowledge of the business,” while Call of Duty on Game Pass was great for gamers, it wasn’t good for sales.
This was despite Microsoft trying to convince UK regulators to approve their $68.7 acquisition of Activision-Blizzard in 2022 by giving “more people more choices for how to play games and give developers more choices for how to reach those people.”
That was going to be via Game Pass (“at an affordable price”) and bringing more games to mobile platforms “including through mobile apps and cloud-based game streaming technology.”
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The pricing increase of Game Pass over time didn’t go down well within Xbox either. Game Pass originally offered $10 a month for over one hundred older titles in 2017. In 2018, Xbox then promised new games on release day. Both current and former Xbox employees reportedly said it was “controversial internally,” turning games that took a lot of time and money to make into (as Bloomberg’s D’Anastasio puts it) “an all-you can-eat subscription.”
The Bloomberg sources also claim Microsoft Chief Financial Officer Amy Hood had asked Xbox to find other ways to increase their profits. It should be noted that, in May of this year, it was revealed US spending on video game subscriptions had been “flat” since 2021.
Unsurprisingly, an Xbox spokesperson declined to comment on Bloomberg’s report.
Even former executives haven’t been able to keep quiet. In September, former Bethesda Softworks’ Senior Vice President of Global Marketing and Communications, Pete Hines, criticized gaming subscriptions in general. “Subscriptions have become the new four letter word, right? You can’t buy a product anymore.”
“When you talk about a subscription that relies on content, if you don’t figure out how to balance the needs of the service and the people running the service with the people who are providing the content – without which your subscription is worth jack s–t – then you have a real problem,” Hines forewarned.
This spurred discussion on LinkedIn, prompting a comment from former Xbox Game Studios Vice President Shannon Loftis, who prefaced, “As a longtime first party Xbox developer, I can attest that Pete is correct.”
“While GP can claim a few victories with games that otherwise would have sunk beneath the waves (human fall flat, e.g.), the majority of game adoption on Gap comes at the expense of retail revenue, unless the game is engineered from the ground up for post-release monetization. I could (and may someday) write pages on the weird inner tensions this creates,” Loftis teased.
Since 2024, we have seen multiple layoffs at Xbox and its subsidiaries. 1,900 jobs in January 2024, shutting down Arkane Studios and Tango Gameworks in May 2024, 650 jobs in September 2024 and 400 from Activision Blizzard, “hundreds” in July of this year.
The price hike of Xbox Game Pass Ultimate even spurred Lina Khan to speak out on X– the former chair of the FTC who objected to Microsoft acquiring Activision-Blizzard. “Microsoft’s acquisition of Activision has been followed by significant price hikes and layoffs, harming both gamers and developers.”
“As we’ve seen across sectors, increasing market consolidation and increasing prices often go hand-in-hand. As dominant firms become too-big-to-care, they can make things worse for their customers without having to worry about the consequences,” Khan scorned.
Finally, it should be noted that Microsoft have told gamers in select regions they won’t have to pay the 50% price increase, if they remain subscribed to Xbox Game Pass Ultimate- at least, until the next billing cycle (“likely to be November 4th.” Blackwell told The Verge).
This may be due to local laws regarding increasing a subscription’s price while a user is still subscribed.
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