Microsoft may reduce Xbox game store cut from 30% to just 12%

Microsoft will soon let developers and publishers keep 88% of revenues of games sold on the Xbox console storefront in 2021.

1 minute & 19 seconds read time

UPDATE: Microsoft reiterates that it has no plans to adjust the Xbox console revenue split, and the store will remain at 70-30 for now.

Microsoft will apparently make history and become the first console platform to offer a 88-12 revenue split in favor of developers.

Microsoft may reduce Xbox game store cut from 30% to just 12% 7

New documents say Microsoft will reduce the revenue split of both its PC and Xbox console storefronts from 70-30 down to 88-12. Developers and publishers would effectively get to keep 88% of revenues versus the 70% from previous years. The news comes days after Microsoft announced it would only charge PC developers 12% of all sales on the Windows Microsoft Store. Epic Games was the first to offer such a revenue split back in 2018.

Microsoft publicly shrugs off the revenue split. "We have no plans to change the revenue share for console games at this time," a spokersperson told The Verge.

This new policy, which is set to launch sometime in 2021 (if at all), likely comes with exclusions and provisions. A blanket reduction would severely cut into Microsoft's digital games revenues which makes up the lion's share of its quarterly and yearly Xbox earnings.

Microsoft's Xbox division has earned a record $11.65 billion so far in FY2021 and most of this was from third-party game sales and in-game monetization. The documents don't specify specific conditions around the revenue split, and it's possible Microsoft will exclusive DLC, add-ons, and microtransactions from the new 88-12 model in order to preserve its current revenues.

It's also possible the new policy has been cancelled and Microsoft will retain its current 70-30 revenue split.

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Derek joined the TweakTown team in 2015 and has since reviewed and played 1000s of hours of new games. Derek is absorbed with the intersection of technology and gaming, and is always looking forward to new advancements. With over six years in games journalism under his belt, Derek aims to further engage the gaming sector while taking a peek under the tech that powers it. He hopes to one day explore the stars in No Man's Sky with the magic of VR.

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