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WSJ - Microsoft Plans to Put Latest Call of Duty Game on Subscription Service, Sources Say

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Microsoft plans a major shakeup of its videogame sales strategy by releasing the coming installment of Call of Duty to its subscription service instead of the longtime, lucrative approach of only selling it a la carte.
The plans, which mark the biggest change to Microsoft's gaming division since it closed the $75 billion takeover of Activision Blizzard, are expected to be announced at the company's annual Xbox showcase next month, according to people familiar with the matter. Call of Duty is one of the most successful entertainment properties ever, generating over $30 billion in lifetime revenue.

Activision, which makes it, has long released new editions annually, selling about 25 million copies on average for around $70 each in recent years. A Microsoft spokeswoman declined to comment.
Before the Microsoft deal last year, Activision was reluctant to fully embrace subscription-based models for a game that still attracts a premium price. Microsoft's subscription service, Game Pass, costs $9.99 to $16.99 a month, and provides access to hundreds of games from Microsoft and dozens of other companies.

All that means that, with Microsoft's new plan, people could end up paying Microsoft less for the new Call of Duty than it would have made with the traditional approach. The tech company's hope is that, instead, it will draw new users to Game Pass who will end up paying it more over the long term.
Last September, Microsoft's science-fiction game "Starfield" was released on Game Pass at launch and it drove a record number of new subscriptions in a single day, Microsoft has said.

Call of Duty was central to regulators' concerns over Microsoft's acquisition of Activision, which closed in October after 21 months. The prolonged review was partly over concerns that the Call of Duty franchise could give Microsoft an unfair advantage in cloud gaming, a new and more affordable way of accessing games, if it were to decide in the future to withhold the series from rivals. Microsoft pledged not to do so.
 
Well, haven't they be pretty crystal clear about Xbox Series Gamepass "first party day1" release, Activision included? Even recently with Sarah Bond's statements

"Xbox first-party titles "across the whole slate," including Activision's portfolio (which includes Call of Duty), will continue to launch onto Game Pass on day one" (7 days ago)

I think that doubts about MS Xbox strategies are legitimate, but in this very moment should be related to first party releases on Playstation and Switch/2 in addition to Xbox and PC (not a doubt about CoD for example, that has been even contractualized with Nintendo for being released also on their console(s)) and GamePass cost increase

I don't see them changing the "first party day1 release on GamePass" in THIS generation of console

in 2026 on their possible next "Xbox" it will probably be different
 
I think that doubts about MS Xbox strategies are legitimate, but in this very moment should be related to first party releases on Playstation and Switch/2 in addition to Xbox and PC (not a doubt about CoD for example, that has been even contractualized with Nintendo for being released also on their console(s)) and GamePass cost increase

I don't see them changing the "first party day1 release on GamePass" in THIS generation of console

I think we should wait until after this releases into gamepass to say this.
 
Will the loss of game sales be worth juicing the Game Pass subscription numbers? Under Kotick, Activision put all their resources towards releasing a Call of Duty every year. CoD game sales are extremely important to ABK. What will happen to Xbox's newest division if its revenue dips?
 
CoD can afford to be a bit of a loss leader on Gamepass with its gargantuan MTX shop, Seems a little late in the game though, if MS had managed to get this deal done a few years earlier and could have advertised CoD on Gamepass at the start of this gen we'd probably see a lot more parity in terms of sales between Xbox and Playstation.
 
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I also think it’s worth it to consider that this isn’t a 3rd party game Microsoft are paying to put on gamepass. They are fully fronting the development and marketing of it for it every year.

I think there’s a reason Kotick didn’t want to go anywhere near Gamepass but Microsoft obviously have different priorities as a platform holder.
 
I think the only way for Xbox to be able to get their user base to accept day and date releases of their games on PS5 is if Xbox spins it towards ''All our AAA games will continue to arrive on gamepass day 1, so Xbox will always be the best place to play Xbox games''. So these games coming out day 1 on gamepass is the only way for them to spin Xbox having a future to their user base when they announce going third party with all their future games.
 
I think the only way for Xbox to be able to get their user base to accept day and date releases of their games on PS5 is if Xbox spins it towards ''All our AAA games will continue to arrive on gamepass day 1, so Xbox will always be the best place to play Xbox games''. So these games coming out day 1 on gamepass is the only way for them to spin Xbox having a future to their user base when they announce going third party with all their future games.

This is a good point. It’s like taking a bit of sugar with your medicine.
 
Will the loss of game sales be worth juicing the Game Pass subscription numbers? Under Kotick, Activision put all their resources towards releasing a Call of Duty every year. CoD game sales are extremely important to ABK. What will happen to Xbox's newest division if its revenue dips?
I mean CoD will sell on PS and PC, it won't sell on Xbox but its a stagnant platform. So they can continue to sell the game in massive numbers on the big platforms and then just use CoD to grow the Xbox platform and gamepass.
 
I mean CoD will sell on PS and PC, it won't sell on Xbox but its a tiny, stagnant platform. So they can continue to sell the game in massive numbers on the big platforms and then just use CoD to grow the tiny Xbox platform and gamepass.

I wouldn’t say it’s “tiny”, Microsoft make up what, 20% or more of COD sales every year? The Xbox install base across two generations are still dedicated to paying full price for annual Call of Duty titles.

20% of the highest selling game every year is a significant number.
 
Will the loss of game sales be worth juicing the Game Pass subscription numbers? Under Kotick, Activision put all their resources towards releasing a Call of Duty every year. CoD game sales are extremely important to ABK. What will happen to Xbox's newest division if its revenue dips?
Have to remember the alternative: no cod on gamepass would break the promise of gamepass and tank its subs. So is cod revenue on Xbox and a bit on PC (cause steam) worth destroying gamepass’s revenue.
 
I wouldn’t say it’s “tiny”, Microsoft make up what, 20% or more of COD sales every year? The Xbox install base across two generations are still dedicated to paying full price for annual Call of Duty titles.

20% of the highest selling game every year is a significant number.
Maybe they hope Switch 2 sales of CoD will replace some of the lost sales potential. But i don't think CoD will be dominant on the Nintendo ecosystem in the way it has been on the other platforms, but it depends on how different the user base of Switch 2 will be to the usual Nintendo user base.
 
Have to remember the alternative: no cod on gamepass would break the promise of gamepass and tank its subs. So is cod revenue on Xbox and a bit on PC (cause steam) worth destroying gamepass’s revenue.

Question is: Can Spencer explain this to the shareholders and get it through? Just three more weeks.

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I think someone said it best when they said they had to put COD into GamePass or get rid of GamePass since this is the last chance it has to grow. At this point, MS has to choose between the safe money of COD's sales or trying to keep GamePass alive.
 
Have to remember the alternative: no cod on gamepass would break the promise of gamepass and tank its subs. So is cod revenue on Xbox and a bit on PC (cause steam) worth destroying gamepass’s revenue.
That’s the catch 22 I feel Xbox has gotten themselves in with GamePass. and with the rumor that they’re raising prices they are going to be constantly trying to adjust this strategy.
 
I clearly see a new GamePass tier coming along CoD. What if this is the opposite of smaking it more affordable and moves big 1st party releases to an extra cost
 
I'm not surprised because not launching CoD day one on gamepass would be killing the service.

When Microsoft stops to launch games day one on gamepass will mean they decided to move on from the service, which can happen, but it's fair they at least gave a chance to see what happens in terms of subscribers and revenue having this juggernaut on GP.
 
Seems like a bad business move, but good for Game Pass subscribers. (Assuming it doesn’t lead to price hikes and/or the end of GP.) I guess we’ll find out whether Phil Spencer or Bobby Kotick were right regarding subscription services.
 
There’s an arguement COD should have its own subscription service anyway and ditch annual releases. We’ll have to see the impact. I suspect this is Microsoft flying a kite to gauge the winds.
 
This should have been obvious they would put COD on GP d1. If they wanna grow GP then they’ll need games like this on the service consistently. Between:
  • MTX
  • PS/PC release
  • Possible NSW2 release
  • Multiple editions
I doubt they really lose that much trying this out. Not gonna be surprised if the price is raised to coincide with this release.
 
Seems like a bad business move, but good for Game Pass subscribers. (Assuming it doesn’t lead to price hikes and/or the end of GP.) I guess we’ll find out whether Phil Spencer or Bobby Kotick were right regarding subscription services.
Enshitification theory says that GP and all other subscription services will become

a) more expensive
b) worse

And it already started.
 
Seems like the most logical and smart thing to do is to add a Call of Duty day 1 Tier. They would need to ensure that whatever tier that is garuntee them at least one full sale of the game even if subscribers don’t keep it for an entire year.
 
I generally agree that they have been clear about first party day one releases but it does feel like this is one of those things that might be contentious within the company's higher ups/shareholders.
 
They releasing CoD day 1 on GP might point to a potential shift in their strategy regarding monetization of the game, while $70 will always be a lot of money, there's a chance they go with an even more GAAS system regarding CoD and i can't say i disagree, there's some huge whales on the CoD market.
 
Feeling the time has come to nuke the GP for Console / GP for PC tiers. Will they exchange them for a middle tier that doesn't include Day 1 releases/COD slightly cheaper than GPU? Will the EA Play agreement continue? Curious to see how it unfolds.
 
They releasing CoD day 1 on GP might point to a potential shift in their strategy regarding monetization of the game, while $70 will always be a lot of money, there's a chance they go with an even more GAAS system regarding CoD and i can't say i disagree, there's some huge whales on the CoD market.
Who knows, maybe the lower initial bar to entry'll make people feel more comofrtable to spend more on it, turning CoD more in the direction of the free-to-play model.
 
New tiers are basically confirmed. I wonder if CoD will be available to current Ultimate subscribers (mine is running until June 2026).
 
i mean they still have full playstation and pc sales. xbox should only be what, 20-33% of retail sales?

i forgot that in the original discussions

Feeling the time has come to nuke the GP for Console / GP for PC tiers. Will they exchange them for a middle tier that doesn't include Day 1 releases/COD slightly cheaper than GPU? Will the EA Play agreement continue? Curious to see how it unfolds.

they need like, 1 tier. it's so confusing as is.

ehh, ngl i kinda wanted cod to be the beginning of the end of gamepass. i prefer ad hoc game sales.

also it's funny people and regulators were mad when the merger was under dispute that ms would put cod on gp. now they got made that ms might NOT put cod on gp. literally damned if ya do damned if ya dont.

20% of the highest selling game every year is a significant number.

it's probably more than 20% if destiny is any indication where xbox makes up nearly a third of users and is bigger than pc. cod is also a franchise that i feel skews to xbox.

Is COD available on PC outside steam? On games for windows I guess? It doesnt typically rank super high on steam CCU. For example right now it is 12th. I just didnt feel like COD is as big on PC as console either.

But ok taking someone about saying 25 million copies of COD sold at 70, lets be conservative at 25% sold on Xbox (I think it's more like 30+)=$440 million revenue

At $17/m you would need about 26million man-months of new GP subs to equal that revenue (aka 26m new subs for one month, or 13m sub for 2 months, or 8.67m sub for 3 months, etc)
 
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They should do a cheaper all 1st party tier, they have enough content to make that appealing between their group companies (XBGS, Zenimax, Activision Blizzard). And it'd be a good model to trojan other walled gardens (PS, Nintendo, iOS).
 
New tier for COD make sense even though it will likely generate some controversy.

In recent years COD annual revenue has been $2 billion. Of that $500m must come from XB.

They will have to justify lost revenue with higher COD tier GP growth.
 
I mean, this is the only thing that makes sense.

Old timey console warriors keep trying to say “Xbox is going third party” or whatever, but Microsoft has no interest in being just a videogame publisher. They want a platform.

Everything they have been doing the past decade or so has been to grow a platform for the future. No, not a piece of hardware console…a platform. A service.

Game pass/xbox live is their platform/service that has always been promised to be “accessible anywhere”

The competition between Xbox and PlayStation isn’t about how much of their own self published games they can sell on a piece of hardware, the competition is what platform people use to play everyone else’s games.

That’s the goal. PlayStation and Xbox are primarily 3rd party gaming platforms and they live or die on how much of their market sees PSN as a place to engage with other people’s products or gamepass/xboxlive.

Sony is going to have to evolve PSN to something similar as well. They seem to already be moving to day and day pc releases and their next step is a more ubiquitous engagement with PSN across devices in a similar way. The current and next generation of gamers care about traditional home consoles about as much as they care about cable boxes.
 
They should do a cheaper all 1st party tier, they have enough content to make that appealing between their group companies (XBGS, Zenimax, Activision Blizzard). And it'd be a good model to trojan other walled gardens (PS, Nintendo, iOS).
That would definitely be a great way to eventually get GamePass on other ecosystems after they port more of their games, but I think the only way Sony would accept it is if it doesn't include COD.
 
That would definitely be a great way to eventually get GamePass on other ecosystems after they port more of their games, but I think the only way Sony would accept it is if it doesn't include COD.
There could be other concessions too if need be. Like maybe not day one for certain titles like COD.

I feel like GP growth is probably a priority and this seems like a good way to go about it. They're hitting a hard ceiling on Xbox and Windows, they need to expand to new platforms and storefronts to keep subs going up.
 
That would be EA Sports FC (or a Rockstar games whenever they release).
I don't think FIFA is ever the best selling game WW since 2018 apart from 2021.

RDR2
Pokemon SwSh
COD MW
ACNH
ELden Ring
COD MW2
Pokemon ScVio
Zelda TOTK
Hogwarts Legacy

Pretty sure all came close or outsold it but we can't say FIFA is the best selling when we have no numbers to say so.
 
There could be other concessions too if need be. Like maybe not day one for certain titles like COD.

I feel like GP growth is probably a priority and this seems like a good way to go about it. They're hitting a hard ceiling on Xbox and Windows, they need to expand to new platforms and storefronts to keep subs going up.
That all makes sense. If it isn't too intrusive, I see no reason why Sony wouldn't allow some version of Game Pass, especially since they're perfectly fine with EA Play.
 
I mean, this is the only thing that makes sense.

Old timey console warriors keep trying to say “Xbox is going third party” or whatever, but Microsoft has no interest in being just a videogame publisher. They want a platform.

Everything they have been doing the past decade or so has been to grow a platform for the future. No, not a piece of hardware console…a platform. A service.

Game pass/xbox live is their platform/service that has always been promised to be “accessible anywhere”

The competition between Xbox and PlayStation isn’t about how much of their own self published games they can sell on a piece of hardware, the competition is what platform people use to play everyone else’s games.

That’s the goal. PlayStation and Xbox are primarily 3rd party gaming platforms and they live or die on how much of their market sees PSN as a place to engage with other people’s products or gamepass/xboxlive.

Sony is going to have to evolve PSN to something similar as well. They seem to already be moving to day and day pc releases and their next step is a more ubiquitous engagement with PSN across devices in a similar way. The current and next generation of gamers care about traditional home consoles about as much as they care about cable boxes.
If that's their strategy they will fail. If they pursue flattening their section of the market into a layer of "services" that are accessible anywhere (i.e. device agnostic), then not only will Steam easily outcompete them both on service and price (no way will Xbox/PS give up mandatory subscriptions for online play after ingraining that behaviour in their customers), but the largest 3rd parties will simply ponder why exactly they're paying fees to Microsoft or Sony when they could also become a device-agnostic service provider (just like they continue to try against Steam). The ability to get a ~$500 box into people's homes is literally the only leverage MS and Sony have, their service offerings are mediocre and reliant on the combination of the hardware's convenience/ability to supply international markets and the customer being held in a walled garden.

Xbox needs to rapidly pivot away from GamePass as "Netflix for videogames" (i.e. blowing vast sums of money paying 3rd party content to be there temporarily), and turn it into a subscription that gives you all of their 1st party content past present and future, and will need to make that completely ubiquitous to be profitable (i.e. subscription is sold on Steam/Sony/Nintendo, on top of their own hardware). That's their last roll of the dice if they still want to maintain a presence that lets them sell 3rd party games on a console box and receive a cut, because without Xbox hardware nobody wants to use their store/services offering in significant numbers. That's the part Nadella and wider Microsoft fundamentally don't understand in their drive to flatten Xbox into a "service" - they're from sections of Microsoft where services offerings are either best in class or have extremely limited/zero competition, unlike videogames, where Xbox are somehow outperformed on even their own OS.
 
If that's their strategy they will fail. If they pursue flattening their section of the market into a layer of "services" that are accessible anywhere (i.e. device agnostic), then not only will Steam easily outcompete them both on service and price (no way will Xbox/PS give up mandatory subscriptions for online play after ingraining that behaviour in their customers), but the largest 3rd parties will simply ponder why exactly they're paying fees to Microsoft or Sony when they could also become a device-agnostic service provider (just like they continue to try against Steam). The ability to get a ~$500 box into people's homes is literally the only leverage MS and Sony have, their service offerings are mediocre and reliant on the combination of the hardware's convenience/ability to supply international markets and the customer being held in a walled garden.

Xbox needs to rapidly pivot away from GamePass as "Netflix for videogames" (i.e. blowing vast sums of money paying 3rd party content to be there temporarily), and turn it into a subscription that gives you all of their 1st party content past present and future, and will need to make that completely ubiquitous to be profitable (i.e. subscription is sold on Steam/Sony/Nintendo, on top of their own hardware). That's their last roll of the dice if they still want to maintain a presence that lets them sell 3rd party games on a console box and receive a cut, because without Xbox hardware nobody wants to use their store/services offering in significant numbers. That's the part Nadella and wider Microsoft fundamentally don't understand in their drive to flatten Xbox into a "service" - they're from sections of Microsoft where services offerings are either best in class or have extremely limited/zero competition, unlike videogames, where Xbox are somehow outperformed on even their own OS.

And like the Windows Store we’re gonna see this again with their mobile store, zero market penetration.
 
MSFT's biggest problem here is actually that nearly everyone who wants to play paid MP COD already has Gold. There revenue difference will be minor in the current prices. People forget that the most popular COD, Warzone, is F2P.

For reference:
  • Likely 50M XB MAU (55M Apr 2023)
  • 25M Xbox GP subs
  • 5M Xbox Gold subs
  • 4M PC GP subs
I assume there's very little use for COD SP, the main attraction is COD MP.
PS had 7M COD players with 70%+ of total time spent on COD alone, which is around 50% of their MAU.
50% XB MAU = 4M

We also have PC players, considering $2.3B came from PS+XB, most of it being COD, and Actis revenue is ~$2.7-$3B. COD mobile included which has to be ~$500M, I'm guessing PC is $200-400M, so around half Xbox.

Overall, 6-8M subs should be the goal to convert. Retaining these COD fans for a full year shouldn't be too hard with so much time spent on COD, but conversely someone who spends so much time only on COD, may find it cheaper to just buy COD.

XB added rev = 4M x $6 x 12 = $288M
PC added rev = 2M x $10 x 12 = $240M
= $528M

This is assuming all 6M players are new to GP. What if many already have GPU?

PC + XB B2P revenue = $1B+
GP Cannibilisation ~ 70%+ = $300M
$300+$528 = $828M

So still short in the best case scenario, however we can also have extra monetisation rate or GP players who never played COD, playing COD and buying MTX.

The whole thing depends on how many MP COD players do not have GP already and how many PC players will sub to GP for 6 months+ for COD MP. Not Warzone.

I wouldn’t say it’s “tiny”, Microsoft make up what, 20% or more of COD sales every year? The Xbox install base across two generations are still dedicated to paying full price for annual Call of Duty titles.

20% of the highest selling game every year is a significant number.
i mean they still have full playstation and pc sales. xbox should only be what, 20-33% of retail sales?

From the FTC case, Xbox accounted for $800M+ ABK revenue, vast majority is likely COD.
We know PS MAU is basically 2x Xbox MAU. PS ABK revenue is also around 2x Xbox ABK revenue.
 
MSFT's biggest problem here is actually that nearly everyone who wants to play paid MP COD already has Gold. There revenue difference will be minor in the current prices. People forget that the most popular COD, Warzone, is F2P.

For reference:
  • Likely 50M XB MAU (55M Apr 2023)
  • 25M Xbox GP subs
  • 5M Xbox Gold subs
  • 4M PC GP subs
I assume there's very little use for COD SP, the main attraction is COD MP.
PS had 7M COD players with 70%+ of total time spent on COD alone, which is around 50% of their MAU.
50% XB MAU = 4M

We also have PC players, considering $2.3B came from PS+XB, most of it being COD, and Actis revenue is ~$2.7-$3B. COD mobile included which has to be ~$500M, I'm guessing PC is $200-400M, so around half Xbox.

Overall, 6-8M subs should be the goal to convert. Retaining these COD fans for a full year shouldn't be too hard with so much time spent on COD, but conversely someone who spends so much time only on COD, may find it cheaper to just buy COD.

XB added rev = 4M x $6 x 12 = $288M
PC added rev = 2M x $10 x 12 = $240M
= $528M

This is assuming all 6M players are new to GP. What if many already have GPU?

PC + XB B2P revenue = $1B+
GP Cannibilisation ~ 70%+ = $300M
$300+$528 = $828M

So still short in the best case scenario, however we can also have extra monetisation rate or GP players who never played COD, playing COD and buying MTX.

The whole thing depends on how many MP COD players do not have GP already and how many PC players will sub to GP for 6 months+ for COD MP. Not Warzone.




From the FTC case, Xbox accounted for $800M+ ABK revenue, vast majority is likely COD.
We know PS MAU is basically 2x Xbox MAU. PS ABK revenue is also around 2x Xbox ABK revenue.
I don't think GP is the full point, at all, regarding CoD. They'll milk dry CoD player base with DLC/MTX, which means getting the $70 from PS5 (And switch 2 users) + DLC/MTX.

GP users will be the entry fee (monthly) to a great game that will be filled with DLC/MTX to keep revenue coming, and it'll probably work wonders honestly bit... they'll milkd everyone out of DLC plus also getting the full price from PS and quite a few PC users.

The question is whatever this will lead to enough profits to offset the $70bn they paid, in time... i guess? but i still think about the opportunity cost of using those $70bn for other things that. Which is probably the biggest issue right now between Nadella and Xbox.
 
Very curious to see what effect this will have on Gamepass but hopefully Microsoft have a few more tricks up their sleeves to pump up Gamepass.
 
I don't think FIFA is ever the best selling game WW since 2018 apart from 2021.

RDR2
Pokemon SwSh
COD MW
ACNH
ELden Ring
COD MW2
Pokemon ScVio
Zelda TOTK
Hogwarts Legacy

Pretty sure all came close or outsold it but we can't say FIFA is the best selling when we have no numbers to say so.
FIFA tends to be just behind COD and selling at least 20 million in their launch period. Most of those games you listed fall short of 20 million of the calendar year if we exclude COD and Rockstar. We're unsure of the exact numbers but EA has not indicated the sales have fallen. So if EA FC isn't significantly down, it suggests that it should be the best selling game in a year with COD unit sales hindered by Game Pass and no Rockstar game.
 
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