Game On: Xbox Game Pass invites comparisons to Netflix, Spotify

After a series of leaks in the past week, Microsoft on Wednesday confirmed that its next video game consoles will be released on Nov. 10. I say consoles because the company has revealed it will offer two options this time around: the beefy Xbox Series X for $500 and the less-powerful, disc drive-less Xbox Series S for $300. I’m an “all the bells and whistles” kind of guy, and I’m rather attached to my CDs – but I’m all for people having budget-friendly options to jump into the Xbox library of games.

In general, it appears Microsoft is playing the long game – it has accepted that its platform doesn’t pull in triple-A single-player games the way Sony’s PlayStation does year after year with popular exclusive titles such as “The Last of Us,” “Uncharted” and “God of War.” Instead, the company is slowly reeling in people with excellent backward compatibility, the ever-expanding Game Pass subscription model and even introducing 24-month financing options for upcoming hardware.

If that reads too much like a news release, please accept my apologies. I’ve always been a late adopter when it comes to new gaming hardware, but this time around, I’m excited – acquiring the newest games on the newest hardware is usually a tantalizing but pricey proposition. In contrast, Microsoft has recently been pushing to make the market a little friendlier for “the little guy,” and I hope it encourages Sony, Nintendo and even the PC platform to be more consumer-friendly, as well.

I have only two worries with regards to Microsoft’s push toward a Netflix-like subscription model for video games: ownership for consumers and the bottom line for game developers. I enjoy owning physical copies of games, and Game Pass flies in the face of it: Pay $10 per month, and you can play hundreds of Xbox titles, but the moment you stop paying or can’t get internet access, you’re out of luck. I recently elected to turn off my subscription while dealing with the stress of moving residences, and on the occasion I get time to power up my Xbox One, it’s a bit disheartening to see dozens of games I have downloaded but cannot access for the time being.

But even more important is the bottom line for game developers and publishers. It’s no secret that Spotify, the biggest name in music streaming, stiffs its artists by giving them a measly $0.0032 per stream, or 1 cent for every three listens. Furthermore, Spotify doesn’t give its contributors any lump sum upfront. I’d hate to see video game subscriptions go down the same path since game development is already a rough-and-tumble career. But just last month, CEO Mike Rose of indie publisher No More Robots went on the record saying the recent release of its game “Descenders” had profited greatly from its existence on Game Pass.

According to him, “When ‘Descenders’ is featured in the top downloads in the Game Pass tab, that leads to more people downloading it. We know there’s tens of millions of people in Game Pass, but that’s not everyone.” Word-of-mouth takes care of the rest because plenty of gamers who don’t have the subscription service want to play “Descenders” with their friends, so they buy the game outright. Ultimately, the developer is seeing higher sales because Game Pass gave them extra exposure. And unlike a platform like Spotify, Microsoft paid No More Robots upfront to add “Descenders” to Game Pass.

Despite this initial success, Rose remains skeptical of the future of video game subscription services in general. He speaks well of Microsoft’s service, but says “my fear is that the other ones won’t be as good – that they’ll give developers crappy deals, and then in three, four, five years time, we’ll be in a situation where we’ve got the Netflix and Amazon and Hulu of video games, but they’re all giving developers crappy deals because they don’t really need you as much as you need them.”

Rose’s fears aren’t unfounded – in the past decade, we’ve seen subscription-based entertainment platforms seriously deflate the profitability of music, film and TV shows for creators while padding the pockets of Netflix, Spotify, Hulu and so on. Microsoft is playing nice so far, but that could change at any time. I hope video games aren’t the next victim.