Entertainment

Xbox misses targets for Game Pass growth and Phil Spencer’s bonuses

October 20, 2021

Xbox’s killer app isn’t quite as deadly as expected (pic: Microsoft)

The number of Xbox Game Pass subscribers grew by 10% less than Microsoft was expecting over the last 12 months, and much less than last year.

Nobody, including Microsoft, ever expected the Xbox Series X/S to outsell the PlayStation 5 straight away and instead it’s been obvious for a long while that Game Pass, and ultimately streaming, is the future of Xbox – and one that Sony so far seems to have little answer for.

In Microsoft’s previous fiscal year, between July 2019 and June 2020, the number of subscribers increased by a massive 86% and easily beat company targets of 71%.

For this financial year though, financial results show that the increase was only 37%, missing the company target of 48% by a surprisingly large amount.

Microsoft has refused to make console sales figures public since the Xbox One era and so the success of Game Pass has become one of the few ways to accurately judge the success of Xbox.

Although even that has become difficult as Microsoft has not shared an update on the total number of subscribers since January, when the figure stood at 18 million.

The subscription service is still experiencing major growth – any other company would be over the moon with 37% – but considering how much has been spent on it, especially in terms of adding major third party exclusives, a slowdown in growth will still be seen as disappointing.

Xbox boss Phil Spencer will be especially upset since, as Axios points out, subscriber growth is tied to his and other exec’s stock bonuses. In fact, it’s the only solely game related metric to be judged in that way.

As more and more first party titles become available on Game Pass – including imminent titles like Halo Infinite and longer term projects from newly acquired developers – the subscription service’s value for money will only increase, but it is still surprising to see a slowdown in growth at this point.