Disappointingly for Microsoft, Xbox Game Pass subscribers missed their target by 10% over the last year, and also showed a significant drop from the prior year.

Whilst there was a realistic view that Xbox Series X/S would not outsell PlayStation 5 straight away, it has been the view that Game Pass and eventually streaming services, would be the final destination for Xbox plans. These plans have so far not received any kind of competitive response from Sony.

How Did The Previous Year Fare For Microsoft?

For the financial year 2019-2020, Microsoft recorded a whopping 86% increase in subscribers..news that is even better when you consider that the target was 71%.

However, these impressive figures have been tempered during the current financial year by disappointing growth figures of only 37%, a figure that even fell short of the much lower target of 48%.

These figures will likely have even greater impact given that Microsoft will not release console sales figures, meaning that Game Pass is the only barometer of success for Xbox.s has become one of the few ways to accurately judge the success of Xbox. And, the analysis issues are now further compounded given that Microsoft will not update their total subscriber numbers…at least since January.

Despite those negative developments, the subscription service, whilst substantially missing targets, is still a very positive area for growth. Even at the current growth rate of 37%, this is still an attractive figure for any company in the current financial environment. For high achievers such as Microsoft though, the trend down in new subscribers will be a disappointing return on investment.

Personal Implications for Xbox Boss Phil Spencer

Not only do the disappointing figures affect Xbox itself, but they also will impact the boss of Xbox, Phil Spencer.

Spencer’s bonus is tied to subscriber growth reportedly, meaning that the figures could impact his, and other executives pay outs.

The future though, is still one that is generally positive for Spencer, and for Xbox. With more anticipated party titles on Game Pass, such as Halo Infinite, the subscription service will be perceived as better value. As the perception of better value increases, this will further ignite subscriber growth.

Given that the future has some much potential for Xbox, the figures released are unexpected…and unwelcome.

Londonlad
Author: Londonlad

Leave a Reply