Arkane founder: Game Pass is unsustainable and damages the industry

Arkane Studios' former boss Raphael Colantonio criticizes Xbox Game Pass years after the disastrous launch of Redfall.

2

More game developers are starting to speak out against Microsoft's high-margin Xbox Game Pass service, and specifically, how the subscription has affected the industry at large. The service, which can impact game sales through a replacive "cannibalization" effect, is seen as a collective form of subsidization through Microsoft's large coffers. In short, the business model sees Microsoft funding new projects with multi-year deals that could turn out to be risky bets and not deliver proper return on investment.

While Xbox gaming CEO Phil Spencer has said many times now that Game Pass is profitable, game developers are saying that Game Pass causes active harm to the industry, with Arkane founder Colantonio saying Game Pass can only really favorably exist in the industry if it focuses on back catalog games.

This is the second time that a major industry figure has spoken out against Xbox Game Pass in recent weeks. Alex Hutchinson, the creative director of indie game Revenge of the Savage Planet, recently said that Game Pass could harm indie titles in the long run.

Read Also:Evidence of third Xbox Game Pass price hike found as Microsoft charges $80 for new games

Below we have a quick transcript of the exchange between Arkane founder Raphael Colantonio and Larian's director of publishing Michael Douse on the topic of Game Pass. Both developers are well-respected in the video games industry.

Raphael Colantonio (Arkane founder): I think Gamepass is an unsustainable model that has been increasingly damaging the industry for a decade, subsidized by MS's "infinite money", but at some point reality has to hit. I don't think GP can co-exist with other models, they'll either kill everyone else, or give up.

Michael Douse (Baldur's Gate 3 publishing director, Larian): "What happens when all that money runs out?" is the most vocal concern in my network, and one of the main economic reasons people I know haven't shifted to its business model. The infinite money thing never made any sense.

Raphael Colantonio: I agree, and I'm fed up with all the bs they fed us at first like "don't worry, it doesn't impact the sales", only to admit years later that it totally does. "No shit it does! Really?"

Michael Douse: Regarding cannibalization of sales:

"We aren't seeing that"

The economics never made sense, but at the same time I do recognize that for smaller teams with new or riskier IPs it helped derisk. Much prefer Sony's 'lifecycle management' strategy.

Raphael Colantonio: Yeah, the only way GP can co-exist without hurting everyone is for the back catalogue

Michael Douse: Exactly!

Another quick note: Former PlayStation boss Shawn Layden took notice of this exchange, and responded with the following GIF: