Analysts View Xbox Game Pass Price Reduction as an Inevitable Move to Boost Subscription Growth

According to industry analysts, Microsoft's move to lower the price of Xbox Game Pass and remove Call of Duty as a day-one offering was a predictable response to the game's limited effect on driving subscription revenue. While opinions are split on the impact on Call of Duty's revenues, Circana's Mat Piscatella notes that the change was expected, stating, "It was clear from the start that Call of Duty on Game Pass didn't lead to a significant increase in Xbox console sales or subscriptions. This change is not surprising, perhaps a bit overdue, but not surprising." Piers Harding-Rolls of Ampere Analysis agrees, saying, "The commercial reasoning for a subscription-first strategy for new releases like CoD hasn't been realized. Its inclusion in Game Pass was meant to boost the service, but the short-term gains in subscribers haven't been sustainable in the long term." Harding-Rolls believes Microsoft was leaving substantial revenue on the table due to lost premium sales, but Piscatella disagrees, saying, "The data never suggested to me that Call of Duty's move to Game Pass had a significant impact on sales. If future versions deliver the experience players want, sales will thrive regardless of Game Pass inclusion." Both analysts welcome the price reduction for Game Pass Ultimate, expecting it to increase subscriber numbers. Harding-Rolls notes that the inclusion of CoD had made Game Pass Ultimate too expensive for many, and this change is a balanced solution. Piscatella thinks the price reduction will help grow subscriber numbers, although he's doubtful it will lead to higher Game Pass spending in the short term. With content being a key driver of subscriptions and cancellations, there may be other surprises that will help drive subscription numbers. As the video game market continues to evolve, subscription spending has been a strong area of growth, and the price reduction will make Game Pass a more attractive option for players seeking value. Harding-Rolls predicts that the drop in monthly price will lead to a rise in Game Pass ARPU in 2026, with less chance of subscriber churn. This change is seen as a continuation of Xbox's legacy under Phil Spencer, prioritizing commercial pragmatism over traditional approaches. The new windowing approach for Call of Duty doesn't mark the end of day-one game releases on Game Pass, but rather a more flexible approach to release windowing for first-party games.