Last year’s Call of Duty: Black Ops 6 was the first entry in the hit multiplayer military shooter to launch day-one on Game Pass in what reportedly turned out to be an expensive experiment for Microsoft. According to Bloomberg, making the game available for free to paid subscribers on console and PC cost the tech giant $300 million in lost sales of the 2024 best-seller. That data point adds some interesting context to Microsoft’s controversial decision to hike the price of Game Pass Ultimate by 50 percent this week.
A defining feature of Game Pass was the decision early on to release first-party games like Forza Horizon 5 and Halo Infinite on the service day-and-date. Bloomberg reports that this move was “controversial internally” due to the likelihood of cannibalizing sales of big games that take a lot of time and money to develop. The Verge reported last year that a similar debate arose around the decision of whether to put Call of Duty on Game Pass or not.
The former long-time head of Activision, Bobby Kotick, went on record during the 2023 FTC trial over Microsoft’s acquisition of the company saying that he didn’t think adding games like Call of Duty to subscription services made “commercial sense.” “I have a general aversion to the idea of multi-game subscription services,” he said at the time. “Maybe part of it is being in Los Angeles and having large, big media companies move their content to these subscription streaming services and the business results have suffered.”
But following the acquisition, Microsoft did exactly that. According to Circana’s U.S. market data, sales of 2024’s Black Ops 6 were 23 percent higher than Modern Warfare 3 sales over the same period, but 82 percent of those sales were on PlayStation compared to Xbox and PC. Subscription gaming services also saw a 16 percent jump year-over-year following the release of Black Ops 6.
If the move cost the company $300 million in lost sales, Microsoft would have needed around 15 million players to subscribe to Game Pass Ultimate for one month to make that up, or just 1.25 million over the course of an entire year. The numbers would be more dramatic for the even cheaper Game Pass PC tier where Call of Duty is also now available day-and-date. The price hikes this week change that math. Now, even if Black Ops 7 saw a similar drop in sales, Microsoft would need only 10 million new sign-ups for Ultimate in November to fill the gap, or just 834,000 over the length of a year.
This week’s Game Pass overhaul shows Microsoft is essentially continuing to back off its original day-one commitment. Game Pass Premium is the same price Game Pass Ultimate was a few years ago, but will only get first-party Xbox games a year after they’re out and it’s not guaranteed to get Call of Duty games at all. This might not be the last major change we see to the service in the near future, either. The company is reportedly testing a “free” ad-supported tier that will be exclusively cloud gaming and could keep raising prices on the higher tiers if it thinks a core audience will stick around.
Bloomberg reports that Microsoft CFO Amy Hood has “asked Xbox to find other ways to increase profit.” Instead of growing its share of the gaming market, the company now seems content to extract more from those already paying it.