Phil Spencer: Game Pass is Profitable, Spends Over $1 Billion to Add 3rd-Party Content to Game Pass - NewsWilliam D'Angelo , posted on 02 January 2024 / 10,578 Views
Microsoft Gaming CEO Phil Spencer in an interview Windows Central revealed Xbox spends over $1 billion a year on third-party content for Xbox Game Pass and the service itself is profitable.
"We have a service that is financially viable, meaning it makes money, in Game Pass," said Spencer. "We've put a lot of money into the market, over a billion dollars a year supporting third-party games coming into Game Pass.
"What we see in Game Pass is a service that supports all kinds of games, from the biggest games, to the unknown indie games that you didn't know you would love until you played it. If you're an individual publisher, you really have to think about 'how do you get everybody playing my game.'
"I think a lot of the publishers are naturally drawn to making games that are big hit games, as big as possible. We want to do that as well, of course. But because we have a platform, and we have a subscription service, having people play more and stay engaged on the platform, frankly, regardless of the types of games they're playing, is a very viable part of our strategy.
"When you look at things we've done over the past 12 months. If you look at things like Pentiment, Hi-Fi Rush, long-term investment in games like Grounded, all of these games have had real success for us in our subscription and in our platform. The diversity of business models allows us to invest in different kinds of content and still have financial success with that content.
"When we look at the back catalog of games from Bethesda, we get really excited. We look at the back catalog from Activision and Blizzard, we get really excited about the things we can do. It's early days, so we need to be talking to that teams that are fully staffed and working on things already. It's not like 'hey, there's a spare team' that you can just go and put on something. You need to make sure those teams have passion for what they want to go work on.
"I will say that the diversity in business models that we have in Microsoft Gaming really lets us supports different kinds of games, different sizes of games, and not every game we build has to be the kind of game that takes up all of your time."
A life-long and avid gamer, William D'Angelo was first introduced to VGChartz in 2007. After years of supporting the site, he was brought on in 2010 as a junior analyst, working his way up to lead analyst in 2012 and taking over the hardware estimates in 2017. He has expanded his involvement in the gaming community by producing content on his own YouTube channel and Twitch channel. You can contact the author on Twitter @TrunksWD.