PlayStation boss Jim Ryan has claimed that video game publishers unanimously agree that Xbox Game Pass is “value destructive.” As part of the ongoing trial involving Xbox parent Microsoft and the US FTC, Ryan appeared in a pre-recorded video deposition, addressing his concerns regarding Microsoft’s $69 billion (about Rs. 5,66,128 crore) acquisition of Activision Blizzard. He stated that Microsoft’s business model for Game Pass has some challenges, and it isn’t profitable for the company. He further claims to have spoken to publishers whose titles are currently available on the service, and they seem to dislike it as well.
“I talked to all the publishers and they unanimously do not like Game Pass because it is value destructive,” Ryan said in his testimony (via IGN). This contradicts Microsoft Gaming CEO Phil Spencer’s claims from last year, where he stated that the subscription service is “very, very sustainable” and that the company was not burning cash aimlessly. It is also worth mentioning that most Game Pass titles announced this year at Xbox’s showcase were from returning publishers, proving there’s some trust built up. That said, Xbox did recently raise the prices for its Game Pass subscriptions around the world. Sony fears that once the deal between Microsoft and Activision closes, Call of Duty would become exclusive to Xbox. Team Green, however, is willing to come to a 10-year agreement that would ensure the franchise’s games release in parity on PlayStation’s consoles — even going into next-gen in 2028.
Ryan added that when Microsoft announced its acquisition in early 2022, Spencer reached out to him with a ‘potential letter of agreement,’ alongside a list of games that Xbox is committed to keeping in parallel with PlayStation. However, it appears as though the agreement did not address the concerns Ryan had about Activision titles on PlayStation and therefore, a counter-proposal was sent. He claimed that Spencer’s response “set the alarm bells ringing,” creating big concerns for Sony. The contents of the interaction were not shared in court, but it all circles back to Call of Duty potentially being added to Game Pass — a fairly cheap alternative — that could move over PlayStation players to the other side.
The hearing also addressed Microsoft’s previous acquisition i.e., Bethesda Softworks and how it impacted Sony. We recently learned that Redfall was originally supposed to be a multi-platform game, but it was then made exclusive to Xbox and PC, following the acquisition. A similar thing happened with Starfield, which Ryan was originally expecting to be available on PlayStation consoles since the developer has always released its games on both platforms. There were a few odd ones like Deathloop and Ghostwire: Tokyo, which was made available on PlayStation for a year, before heading on to Xbox. While Ryan isn’t a fan of Starfield becoming locked to the rival platform, he doesn’t consider it anti-competitive. He doesn’t share similar views about Call of Duty, though.
Earlier this week, Spencer testified that Microsoft learnt that Starfield was going to skip Xbox — possibly as a timed exclusive for the PS5 — which led to them acting fast and acquiring Bethesda’s parent company ZeniMax Media. “So the discussion about Starfield… when we heard that Starfield was potentially also going to end up skipping Xbox, we can’t be in a position as a third-place console where we fall further behind on our content ownership so we’ve had to secure content to remain viable in the business,” Spencer said during the cross-examination (via The Verge).