Microsoft’s purchase of Activision Blizzard hasn’t helped it grow Xbox Game Pass or the gaming business in general. According to a new report from The Information, the growth from the acquisition has yet to hit what Microsoft was hoping for when it made the $69 billion purchase.
The Information claims that Microsoft was hoping that the purchase would help convince more players to sign up to the service as well as push more studios to releasing their games on the subscription-based platform. Instead, their sources say say that “several leading game studios have resisted Microsoft’s pitch that they should put their titles on Game Pass in exchange for fees that Microsoft offers to pay to the gaming studios.”
Denny Fish, a portfolio manager who oversees funds including a reported $800 million of Microsoft stock, told the outlet, “[Activision] has been disappointing.”
Microsoft had targeted reaching 100 million subscribers by 2030. As of February 2024, there were 34 million subscribers, including those who became subscribers after Microsoft converted Xbox Live to Xbox Game Pass Core. Microsoft has failed to hit Game Pass growth targets in each of the last two years. That led to Game Pass’s growth being dropped as a metric that determined CEO Satya Nadella’s pay at Microsoft.
Meanwhile, the company raised its prices while introducing a new tier—Game Pass Standard—that took away Day One releases from console subscribers unless they upgrade to Game Pass Ultimate.
In addition, Microsoft expected more studios and publishers to rent Azure cloud servers for their games. It’s said that Activision is still using Google Cloud and Amazon Web Services for its server rentals along with “primarily relying on its own servers for development”.
Insider Gaming has reached out to Microsoft regarding the report. Should a response of any kind be received, it will be added to this story. Microsoft is scheduled to announce its Q2 earnings for FY2025 on January 29.
What do you think of Activision not helping Microsoft grow its Xbox Game Pass service along with other areas of the gaming division? Let us know down below, and join more discussions in the official Insider Gaming forums.
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Mike has been covering the gaming industry since 2012, and has reported on some of the largest events in the industry while also working as an investigative reporter. Outside of…
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Actually launch games on Game Pass. Also buy Take Two Interactive next and launch the annual sports games on Game Pass. Fire Phil Spencer, Aaron Greenberg, and whoever else and let the Activision and Take Two staff if you buy them run the place.
Because how poorly the gaming division is run will they finally fire Phil and it’s not just him all the “Team Xbox” people Aaron Greenberg, Matt Booty, Sarah Bond, the “support team” dump them all! Honestly I’d say take a risk and hire Dr. Disrespect to run Xbox at this point and bring back the classic 2002 Xbox logo the nostalgia would sell but they’re too tense and Washington based to realize what players want. I’m not sure if Sheamus and Ed Fries could save Xbox as is those guys in the 2000’s were on fire if they had this budget and did what they did in the 2000’s no woke crap Xbox would be a powerhouse but Phil helped ruin that and even before him I mean 360 was the beginning of Halo, Gears, Forza console then XB1 was the woke. I’d say kiss Trump’s ass and bring in one of his people to save the brand.