Why Microsoft wanted to increase the price of Xbox Live Gold: Daniel Ahmad explains

Why Microsoft wanted to increase the price of Xbox Live Gold Daniel Ahmad explains

At the end of the week, Microsoft’s gaming division tried to increase the cost of the Xbox Live Gold subscription – in particular, it is needed to play multiplayer projects on the Xbox. After the outrage of the players, the corporation played everything back.

At the same time, Microsoft promised to open up access to multiplayer in free games without Xbox Live Gold. Some players suggested that all of the company’s actions were calculated in advance. Niko Partners senior analyst Daniel Ahmad disagrees with these assumptions.

On his Twitter account, Ahmad launched a thread explaining the logic behind the price hike for Xbox Live Gold and Microsoft’s next steps. Here are the highlights from his story.

  • Microsoft’s main long-term goal now is to promote Game Pass subscription – it should be the main entrance to the Xbox ecosystem on all possible platforms.
  • The strategy is logical, but difficult to implement in the short term. Game Pass now has about 15 million subscribers, almost all of whom are Xbox consoles. It has not yet been possible to reach a significant external audience.
  • This is also logical: Game Pass does not yet have a steady stream of AAA games available in a subscription right on release.
  • In order to further increase the subscription audience, while the release of AAA projects does not get better, Microsoft needs to actively transfer Xbox owners to it.
  • Simply ditching Xbox Live Gold and making multiplayer free is no guarantee that old subscribers will upgrade to Game Pass.
  • The increase in the price of Xbox Live Gold makes the switch to Game Pass a win-win for gamers. Microsoft has nothing to lose either: those who remain on the old subscription will simply make more money for the corporation.
  • After the outrage of the players, Microsoft decided to back it up because it remembers past PR failures.
  • The issue of free multiplayer in shareware games has been worked out for several months. The announcement was specially made ahead of time to smooth out the players’ indignation.

The failure of the strategy with an increase in prices, Ahmad is sure, will not affect the overall strategy of Microsoft. The corporation will continue to work on ways to transfer as many Xbox owners as possible to Game Pass.

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