Microsoft’s Xbox Game Pass service has reached a significant milestone, boasting 34 million subscribers, a notable increase of 36% from the previously reported figure of 25 million over two years ago. According to The Verge, this latest update was shared during an official Xbox podcast, which also highlighted the introduction of Xbox exclusives to the PS5 and Nintendo Switch platforms.
The revelation of the updated subscriber count marks the first time Microsoft has shared new data on Xbox Game Pass since its acquisition of Activision Blizzard in January 2022. Despite this growth, Microsoft Gaming CEO Phil Spencer has observed a slowdown in the rate of new subscriptions on console platforms, attributing it to the saturation of the console market. However, he noted that the PC segment of Game Pass has seen “incredible growth,” suggesting a broadening of the service’s appeal.
Microsoft’s long-term goals and challenges for Xbox
Despite the positive trend, the current subscriber numbers indicate that Microsoft is still far from reaching its ambitious target of 100 million Xbox Game Pass subscribers by 2030. The company had aimed for a 73% growth rate for Game Pass subscriptions for the fiscal year ending in June 2022 but only managed a 28 percent increase. As a result, Microsoft removed Game Pass growth from the performance targets for CEO Satya Nadella’s executive compensation after failing to meet these ambitious goals for two consecutive years.
The slower growth in console subscriptions, coupled with the Xbox Series S/X consoles’ sales not keeping pace with the PS5, presents ongoing challenges. Moreover, the adoption rate of Xbox Cloud Gaming on mobile devices has not met expectations. Despite these hurdles, Spencer emphasized that not every user needs to become a Game Pass subscriber. Subscription revenue currently represents only a small fraction of the company’s overall content and services revenue.
Looking to the future, Microsoft is focused on expanding Game Pass, particularly in the mobile gaming sector, by developing an Xbox mobile gaming store to compete with Apple and Google. However, Apple’s recent App Store policy changes have not aligned with Microsoft’s plans for monetizing Xbox Cloud Gaming on iOS platforms. Spencer criticized Apple’s policy adjustments for not doing enough to promote competition on the world’s largest gaming platform. Microsoft intends to continue its dialogue with regulators, Apple, and Google to advocate for more open competition in the gaming market.
