According to a report from the UK’s Competition and Market Authority (CMA), Activision Blizzard has avoided launching games on Xbox Game Pass because the company believes that doing so would cannibalize B2P (buy-to-play) sales. The company analyzed new releases and found that those launched through Xbox Game Pass yielded less money from direct purchases.
While Activision has not said this directly, the information comes from what Microsoft submitted to the CMA: “An important reason for Activision not offering current content on MGS is because MGS sales would cannibalise Activision’s B2P sales, which are a key source of and driver of revenue for Activision.” This is surprising, considering Activision has seemed keen on being acquired by Microsoft.
The report continues, “in the rare cases where Activision has contemplated placing its content on MGS services, its ordinary course documents consistently reflect Activision’s view that MGS services, regardless of platform, severely cannibalise B2P sales, particularly in the case of newer releases.”
Eurogamer received a comment from Microsoft, but the company didn’t provide a telling response, simply offering words of encouragement on why its service has plenty of value, offering both gamers and creators more choice in how they “discover, experience, and deliver games.”
The response does not address the crux of the report, but the company does claim that they “work closely with creators to build a custom program to reflect what they need, and ensure they are compensated financially for their participation in the service.”
As far as what this means for Xbox’s fierce battle in attempting to acquire Activision Blizzard, the company might have a difficult time now that Xbox Game Pass is under such intense scrutiny.
Microsoft will be defending the validity of its acquisition at the European Commission on February 21. The hearing will not be public, but we are looking forward to the aftermath.
