Xbox Game Pass is A Financial Success, Earning $230 Million Revenue In One Month – PlayerAuctions Blog

Microsoft has recently provided new insights into the financial success of the Xbox Game Pass. The company revealed in the FTC v. Microsoft federal case that the average revenue per subscription is $9.26. With a subscriber base of over 25 million as of January 2022, the service has generated an impressive $231.5 million in revenue in just one month.

In addition to console users, there are 3.1 million active PC Game Pass users who pay $9.99 per month for their subscription. This generates similar revenue to the console subscribers.

A Bulk of Microsoft’s Revenue Relies on Their Console Users

Microsoft is well-known in the industry as a major player, thanks to the Xbox and its online services, including the now-defunct Xbox Live Gold. In recent years, their primary revenue source has been the Game Pass subscription service. The data from the FTC v. Microsoft federal case confirms some key details about this revenue.

According to the disclosed information, the Xbox Game Pass on console generated $2.9 billion in revenue in 2021. In April 2022 alone, Microsoft earned around $231.5 million in revenue. This calculation is based on the average subscription price of $9.26 per user, which closely aligns with the original price of $9.99 per month.

The numbers also provide insight into the demographics of Xbox’s subscribers. The majority of Game Pass users primarily use the Xbox One and Xbox Series S/X consoles, with 21.9 million active subscribers out of a total of 33.6 million in April 2022. Additionally, there are 3.1 million PC Game Pass owners. It’s important to note that these statistics do not include the recent growth in the past few months.

Long-Term Impacts of the Game Pass

While the Game Pass offers undeniable value to its subscribers, some concerns have been raised about its long-term impacts on the gaming industry. The shift from physical copies of games to digital-only access has already begun, especially with the introduction of diskless versions of Xbox and PlayStation consoles by Microsoft and Sony.

While many benefit from the Game Pass, there is a possibility that access to more games could become more restricted or monopolized, potentially leading to increased subscription costs. We have seen similar trends in other subscription models like Netflix.

Microsoft’s commitment to affordability and inclusivity is commendable, but there is still a level of uncertainty and unease surrounding the Game Pass. A subscription-based industry could present challenges, from reduced availability of games to potential price increases. Netflix, for example, recently experienced an $18 billion loss in value due to its crackdown on password sharing.

In conclusion, we cannot deny the growth and dominance of the Xbox Game Pass, but we should be mindful of its future implications. As we transition to a digital-only game release environment, we must consider the balance between corporate profits and consumer benefits.