Microsoft responds to the FTC’s comments about its Xbox Game Pass changes
Earlier this month, Microsoft announced sweeping changes to Xbox Game Pass, which sees price increases across Game Pass Ultimate, PC Game Pass, and Game Pass Core. The company also revealed that it’s retiring Game Pass for Console (for new subscribers), which will be replaced sometime in the future by a new Standard tier. Unlike Game Pass for Console, Standard subscribers won’t be able to play day-one release on the service, but online multiplayer will be bundled into the tier.
Last week, the Federal Trade Commission filed a letter with the courts, suggesting that the changes to Xbox Game Pass are the kind of “consumer harm” it was fighting against during Microsoft’s acquisition of Activision Blizzard, calling Game Pass Standard a “degraded” product.
Microsoft has now responded to the FTC’s comments (via The Verge’s Tom Warren), which the company says “presents a misleading, extra-record account of the facts.”
“Earlier this month, Microsoft announced changes to its gaming subscription service, Game Pass, to provide consumers valuable options at different price points. Microsoft is offering a new service tier, Game Pass Standard, which offers access to hundreds of back-catalog games and multiplayer functionality for $14.99/month,” Microsoft says. “It is wrong to call this a ‘degraded’ version of the discontinued Game Pass for Console offering. That discontinued product did not offer multiplayer functionality, which had to be purchased separately for an additional $9.99/month (making the total cost $20.98/month). While Game Pass Ultimate’s price will increase from $16.99 to $19.99/month, the service will offer more value through many new games available ‘day-and-date.’ Among them is the upcoming release of Call of Duty, which has never before been available on a subscription day-and-date.”
Microsoft says that the FTC “barely mentioned” its subscription during the Activision Blizzard trial, instead focusing on “the theory that Microsoft would withhold Call of Duty from Sony’s console.” Sony and Microsoft penned a ten-year deal last year to keep Call of Duty on the platform. According to Microsoft, Sony was “thrilled” to enter it, which “further eroded” the FTC’s theories that Microsoft would gatekeep the franchise.
“While the FTC has now tried to shift focus to its alleged subscription market, its letter does not map onto its arguments below,” Microsoft’s filing says. “Setting aside that it is common for businesses to change service offerings over time, the FTC case in all of its alleged markets has always been premised on vertical foreclosure, i.e. that Microsoft would withhold Call of Duty from rivals and therefore harm competition. But even in the alleged subscription market, Call of Duty is not being withheld from anyone who wants it. And there remains no evidence anywhere of harm to competition: Sony’s subscription service continues to thrive, even as they put few new games into their subscription day-and-date, unlike Microsoft.”
This year’s Call of Duty: Black Ops 6 will launch into Xbox Game Pass for Ultimate and PC Game Pass subscribers, but all Game Pass subscribers can enjoy the upcoming early access and open beta weekends.