Phil Spencer, the CEO of Xbox, has stated that while Game Pass is rapidly rising, it will not be able to replace customers buying games. For the time being, the CEO told the New York Times’ Sway podcast that the company’s “transaction” business – i.e., buying a game – is still bigger than subscription. When asked if he would compare Game Pass to Netflix for games, Spencer agreed, but added that consumers can purchase whatever they are streaming.
Game Pass does not replace the purchase of games
He continued: “Transaction is bigger than subscription. Subscription is growing faster, just because it’s relatively new. And with Game Pass, we were one of the first movers in that space. But the transaction business is very large. We still sell physical disks.” Microsoft recently rebranded Xbox Game Pass for PC as, well, PC Game Pass.
“I’d say the difference for us is in the business model of — you can buy every game that’s available on the subscription, which is a little different than a music subscription or a movie subscription,” he said. “But the technology itself to any person that hasn’t experienced it would feel like I’m watching a video. But if I click, the character on the screen actually moves. But yeah, it feels like Netflix. But we do — I think the option of allowing people to buy, it’s just been a traditional part of gaming. The retail market continues to be very strong and grow. So let’s make sure we offer our customers choice between subscriptions and transactions. That’s probably the only difference between us and some of the video subscriptions.”
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