We have a good idea of what the next generation of consoles looks like, at least in terms of hardware. We even know what most companies will focus on to beat the competition: Sony relies on Popular third-party exclusives for the PS5, while Nintendo is hoping for wide appeal, and many indies will keep the Switch attractive.
But surprisingly, it’s Microsoft that drives innovation. Not with jaw-dropping hardware power, nor with a huge stable of exclusive games. Xbox Series X and cheaper S series don’t, at least not in Sony’s and Nintendo’s abundance. It’s not even that competitive on price, as the S-Series has the same retail price as the more mature Switch.
No, Microsoft is betting big on changing the way people pay for entertainment. And they could win it all.
The “Netflix for games” has arrived
A few years ago, it became de rigueur to call a new service “Netflix of ____”. It’s out of fashion now, if only because replicating Netflix’s pay-one-and-get-all success has proven to be much more difficult than it looks. But Xbox Game Pass did.
Game Pass is Microsoft’s offer to a subscription gaming service. It’s not unique: Sony has one, Nintendo has one, mega-publishers like EA and Ubisoft have a. same Apple and Google everyone has one. But Game Pass is head and shoulders above the competition, thanks to its focus on adding highly desirable new games to its library immediately upon release, and attracting Xbox and PC gamers.
Game Pass started with the Xbox One, but with the Xbox Series X and Series S, Microsoft aims to make the service and hardware almost indistinguishable from one another. If you’ve got a new Xbox, you want Game Pass Ultimate, if only because it’s phenomenal value. For a few bucks more than Xbox Live (the online multiplayer component that rolled out from the original Xbox), you get access to a library of over 100 full games to download and play at your leisure. Oh, and you also get the multiplayer component.
You also get access to some of these games on a PC (assuming yours is powerful enough to play them), and starting this month, access all of them. streaming on Android phones and tablets. It’s an amazing sale, especially now that you don’t even need an Xbox to play the games anymore. There are other Game Pass tiers ($ 15 for everything, $ 10 for Xbox with some perks removed, $ 10 for PC only), but Ultimate is clearly the winner.
Microsoft doubles the Game Pass. The Pass currently includes AAA titles such as Halo, Resident Evil, Forza, Gears of War, Minecraft, Sea of Thieves, and Minecraft, as well as popular indie games like Ori and the Blind Forest, Don’t Starve, Hollow Knight, Subnautica, and dead cells. But the Pass also receives at least a few new top-tier games: I played The Outer Worlds the day it was released on a nearly free Game Pass trial.
At Microsoft’s big showcase for the Xbox Series X (and by extension, Series S) in July, it showcased 20 new titles, including Halo Infinite, Forza Motorsport, Psychonauts 2, a new Fable, and expanded content for The Outer Worlds, Destiny 2, and Phantasy Star Online 2. And all will be on Game Pass on the first day, available to subscribers without paying an additional penny.
This is serious value. The fact that all games in the EA Play subscription (formerly EA Access and Origin Access) are coming to Game Pass at no additional cost, that’s just the icing on the cake.
The right price at the right time
But strengthening Game Pass is only half of Microsoft’s strategy. Mobile streaming notwithstanding (especially because it’s limited to Android), you need to get people to have the hardware to play all of these games. And depending on them for powerful gaming PCs is not an egalitarian approach.
Microsoft’s one-two punch combines Xbox hardware and Xbox Game Pass membership. Starting with the launch of Xbox Series X and Series S, you can pay a monthly fee for your console and game subscription together. It has the same two-year life span and the same interest-free price that consumers have become accustomed to now that high-end phones are tearing up four digits.
For Game Pass Ultimate and the flagship Xbox Series X, you pay $ 35 per month for two years. For the cheaper discless Xbox Series S (which can play all the same games with lower visual fidelity), it costs just $ 25 per month. While it has certainly been possible to buy a game console on credit or with layaway, offering a combined subscription and interest-free financing like this is unprecedented.
And that’s a good deal, too. Xbox Series X costs $ 500, Xbox Series S is $ 300, and Game Pass Ultimate would cost $ 360 for two years. So at $ 35 or $ 25 per month, players who opt for this combination save $ 20 and $ 60 respectively. Unless you just like paying monthly, or think you’ll get bored of your new Xbox in less than two years, there’s no reason not to go for the bundle subscription option.
With a few years of experience selling Surfaces through the Microsoft Store (which includes financing options), Microsoft was uniquely positioned to extend some of the same offerings to its gaming customers. So I’m inclined to believe that this subscription model for games and the hardware to play them has been in the plans for a long time.
And while there is nothing right about the coronavirus pandemic, the point is, people have more time and less money than they otherwise would. This makes the allure of a $ 25 per month subscription, for more games than you could play in 10 years, incredibly appealing at the moment. It’s a coincidence for Microsoft: they have exactly the right plan at the right time.
A bet on the future
Sony has been on top of the world ever since dominating the console landscape with the PS4, and the Switch remains the most popular console for mainstream gamers and children. So to say that Microsoft’s subscription strategy for Xbox news has already “won the console wars” would be incredibly short-sighted.
But make no mistake: the Xbox is in a fantastic position as the next generation kicks off. We still need to see the supposed 4K upgrade for the Switch, and the future of streaming games is still very evolving. But if I were a gambler, I would bet on Xbox to get a really good lead in 2021.