Game Pass Has Changed the Economics of Exclusivity
Historically, exclusive games made their money in a pretty upfront, simple way. See, games made the lion’s share of their money in the first couple of days on the market, while if your game is available on multiple platforms, the profit you’ll see for your particular platform will go down. Thus, we have exclusives. Game Pass changes up this dynamic a lot. With Game Pass, Microsoft wants people to subscribe and stay subscribed. Accordingly, they’ve made it cheap and filled its library with big, popular games. Game Pass is such a good deal that a lot of Xbox owners, for example, that used to buy each new game they wanted to play now just subscribe to Game Pass. In a very direct way, Game Pass cuts into the raw sales numbers Microsoft will see for Xbox. But that’s okay, because Microsoft isn’t making its money off of selling copies of a game anymore, Microsoft wants to rake in huge sums of money a month from Game Pass subscribers. This is why Call of Duty is coming to Game Pass. CoD games notoriously don’t go on sale or lower in price that much, ever, and there are so many of them, so it’s hard for fans to keep up, and it’s harder for fans to be able to play older games when they’re forced to buy them again for what is often quite a lot of money. By bringing CoD to Game Pass, sales of CoD games on Xbox is going to drop, but subscribers to Game Pass will increase. This is what Microsoft is after, and this new way to make money off their games is precisely why Microsoft is going to keep bringing CoD to PlayStation, because it doesn’t really matter how many copies sell on PlayStation as Microsoft isn’t trying to make the most money possible off of selling copies of the game anymore. But games have changed a lot, too, and there’s another big reason why it’s in Microsoft’s interest to keep CoD on PlayStation: microtransactions.
Microtransactions and Call of Duty
10 or 15 years ago, when the latest CoD came out, Activision made almost all its money from selling copies of the game. Sure, they made some cash through DLC packs and merchandising and exclusive content agreements with console manufacturers, but the vast majority of the money made just came from selling the game. A few weeks after launch, generally, would give way to most of the money a game would make. That’s a lot different today. Microtransactions account for a huge percentage of CoD’s profits, and that’s why Warzone is the most successful Call of Duty game ever. Nowadays, it’s not unreasonable for a gamer to spend more than the cost of the game in microtransactions over the course of the game’s lifetime. So, even if Microsoft loses money on selling the actual game on PlayStation, all of those microtransaction dollars will still be heading straight to Activision, and thus Microsoft, from all those PlayStation players. When you combine this with the fact that Microsoft isn’t trying to maximize profits by selling copies anyways, keeping CoD on PlayStation is a no-brainer. It’s free money.
The PR of Exclusivity Today
Today, games are more cross-platform, cross-playable, and multi-platform than ever before. You can play games with more people, and games are more accessible than ever. Call of Duty, itself, is a multiplatform game (and has been for decades) that’s also had cross-platform crossplay for years. In every sense, making Call of Duty exclusive suddenly after all these years would make many people upset. There would be absolutely no justification for the move other than to make more money at the expense of making a game gamers wanted, and that’s really no good for Microsoft. See, Activision was better suited to the oftentimes contentious relationship between fan and creator, because Activision made its money by selling games, and even if the games had problems, relatively few people were going to refund anything. Once it made its money, it made its money. Microsoft is depending on the continued goodwill of customers. They want people to pay them every month for Game Pass, so if Microsoft starts making a ton of anti-consumer decisions, people are going to lose faith in Game Pass and start unsubscribing. Game Pass is central to Microsoft’s current philosophy, so there is almost nothing worth risking Game Pass subscriber numbers.
