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According to The Wall Street Journal on Friday, the upcoming Call of Duty installment will be introduced on Xbox Game Pass, signaling a significant risk for Xbox and the latest effort to shape the future of Microsoft’s gaming sector.
Now under Microsoft’s ownership, Activision continues its annual tradition of releasing a new Call of Duty, consistently topping sales charts. Even titles receiving a lukewarm reception, such as 2023’s Modern Warfare III, often end up in the year’s top 3 sales list, primarily driven by their unrivaled multiplayer experience. The WSJ mentions that Microsoft aims to launch the new Call of Duty at the upcoming Xbox Games Showcase, revealing its inclusion in Game Pass from day one.
Placement of Call of Duty in the Game Pass subscription service is anticipated to ignite new enthusiasm for both the service and the Xbox platform itself.
This promises to be a beneficial arrangement for players. Despite lingering rumors that Microsoft will increase Game Pass pricing or introduce new tiers, it would still allow individuals to experience the latest CoD title for a few months at a cost lower than the $70 retail price of the game.
However, this strategy might detract from the game’s overall sales, particularly on the Xbox platform.
Conceptually, it could also serve as a definitive test for Microsoft’s description of Game Pass as a “discovery engine,” potentially attracting those who might not have considered purchasing a new Call of Duty or offering millions of casual players a reason to skip buying this year’s release.
Last summer’s legal tussle with the FTC over acquiring Activision exposed that Call of Duty alone comprises a significant segment of the gaming audience. A decision to make CoD exclusive to Xbox could have shifted approximately 7 million players from Sony’s PlayStation 4 and 5.
Nevertheless, the current strategy is to maintain cross-platform accessibility while leveraging it to boost Game Pass subscriptions.
This approach further exhibits Microsoft’s latest console strategy as a redefinition of its success metrics. The company’s public focus shifts away from hardware sales or individual game sales towards the number of Game Pass subscribers.
The potential success of the Call of Duty initiative could mark the latest point of contention in recent Xbox debates.
Microsoft’s gaming division began the year strongly, finalizing the acquisition of Activision and seeing Xbox revenue surpass Windows for the first time. Meanwhile, competition seemed to wane, with Nintendo gearing up for a new console launch and Sony undergoing internal restructuring, leaving a gap in first-party releases until the following year.
Instead of focusing solely on exclusives to drive sales, Xbox ventured to port several first-party titles, like Sea of Thieves and Grounded, to PlayStation and Switch.
While this has been financially advantageous, it has concurrently impacted the Xbox brand, evidenced by a significant drop in Xbox hardware sales revealed in April’s earnings report.
Moreover, Microsoft recently announced the closure of several studios, including the teams behind last year’s cult hit Hi-Fi Rush and the less successful Redfall, resulting in a wave of industry layoffs and shutdowns.
A town hall meeting hosted by Xbox Game Studios head Matt Booty revealed a disconnect between leadership actions and expressed needs for smaller, award-winning games, further complicating the perception of Xbox’s direction.
An editorial by IGN’s Ryan McCaffrey argued that rapid growth from acquisitions has made Xbox too unwieldy, necessitating a significant restructuring.
While the upcoming Showcase and Call of Duty announcements are critical, they’re unlikely to be the sole determining factor for Xbox’s future. Instead, success or failure here may lead to a significant strategic reassessment for Xbox, potentially redefining its position within the gaming industry.
