Microsoft's announcement of a significant price increase for the different subscription formulas to Xbox Game Pass has generated strong discontent among users, especially in light of the recent statements by the president of Xbox, Sarah Bond, who called the service already largely profitable, with a record turnover of $5 billion in the last fiscal year. The question arises: why such a heavy price increase? Apparently, behind this decision lies the imposing shadow of Call of Duty and a growing internal pressure to maximize profits.

Despite attempts to justify the new prices by adding unprecedented benefits to the offer, several internal sources, reported by Bloomberg, have revealed that the revenues generated by Game Pass are still not in line with Microsoft's expectations. The main problem is a phenomenon that the company itself had admitted before the British CMA as early as February 2023: the cannibalization of game sales. Including titles of huge appeal in the service from launch day inevitably pushes users not to buy the game at full price.

And with a money machine like Call of Duty, the impact is devastating: it is estimated that Xbox has given up about $300 million in sales of the franchise on consoles and PC in the last year alone. As stated by analyst Joost Van Dreunen, "Game Pass did not generate the explosive growth that Microsoft anticipated after the acquisition of Activision, and they realized that their infrastructure costs did not match their pricing model".

The acquisition of Activision Blizzard King for the sum of almost 69 billion dollars has radically changed the cards on the table, dramatically increasing the need to return on the investment. According to reports from current and former employees, Microsoft's chief financial officer, Amy Hood, has explicitly asked the Xbox division to identify new strategies to increase profits, a request that also came after an already painful wave of layoffs. The decision, taken in 2018, to include all first-party games in Game Pass since launch had not found unanimous consensus within the company precisely because of these fears, and now the knots seem to be coming to a head.

One figure above all would have sounded the alarm bells in the upper floors of Xbox: 82% of Black Ops 6 sales were recorded on PlayStation. This figure mercilessly highlights how many full-price sales are sacrificed on the altar of Game Pass, prompting management to run for cover with price increases. The strategy is clear: if you want to play the new Call of Duty at launch via subscription, you will have to subscribe to the most expensive formula.

This new policy is perfectly reflected in the structure of the new subscription tiers. The new Xbox Game Pass Premium, in fact, promises access to Xbox games within 12 months of their release, but with one conspicuous exception: Call of Duty. Microsoft has not specified when the famous shooter will arrive in this price range. The only way to play the next chapter of the saga on the day of its release remains the Xbox Game Pass Ultimate subscription, the one that has suffered the heaviest price increase.

In a hardware market dominated by Sony and Nintendo, and with subscriber growth slowing down (from +80% in 2020-2021 to +36% in 2022-2024), Microsoft is desperately looking for a new balance to make its offer sustainable and, above all, much more profitable.