Call of Duty day and date releases could justify Game Pass price hike

Microsoft may raise Xbox Game Pass Ultimate subscription prices if and when it acquires Activision-Blizzard's treasure trove of billion-dollar franchises.

Call of Duty day and date releases could justify Game Pass price hike
2 minutes & read time

Microsoft could use the Activision-Blizzard acquisition to justify a new Xbox Game Pass price hike.

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Subscription prices almost always rise in proportion to the value that they offer. Netflix, Disney+, and Hulu have all raised subscription prices to reflect significant content investment made by the companies and the greater perceived value from each service. Sony also did this by introducing a costly three-tier subscription plan for PlayStation Plus with prices that range from $59.99 - $119.99 a year, with each tier offering specific value propositions.

Right now there's no better deal in gaming that Xbox Game Pass. The service offers access to over 400 first-party and third-party games across Xbox consoles, PC, and even mobile. At $14.99 a month, the service has become one of the most popular value-oriented subscriptions in gaming, amassing 25 million subscribers as of January 2022. If Microsoft acquires Activision-Blizzard, Game Pass will surge in value...and Microsoft is likely to correct the value-vs-price equation with a Game Pass cost hike.

Microsoft has expressed interest in bringing Call of Duty, Diablo, and Overwatch to Game Pass. Just bringing Call of Duty to Game Pass is enough to justify a subscription price increase, let alone day-and-date releases. Call of Duty is a juggernaut franchise that has made over $30 billion in lifetime revenues, and made a whopping $3 billion in net bookings in 2020. It's so big that adding COD games alone to Game Pass could justify a higher-priced tier.

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Game Pass has grown considerably over the years, and also directly helped spark Xbox revenues.

There's also the concern of Microsoft recouping its acquisition spending. The tech giant is willing to buy out all of Activision-Blizzard's outstanding shares in a mega $68.7 billion purchase, which is 5x larger than any other video games acquisition in history. Right now Game Pass is largely seen as unprofitable (however Microsoft doesn't reveal numbers for the service, yet GP has helped Xbox consistently grow over time) and adding something like Call of Duty could maximally surge subscriber adoption over time.

If I had to guess, I would say Microsoft may not raise Game Pass subscription costs immediately after acquiring Activision-Blizzard. The price hike could come after the company on-ramps more subscribers, similar to how Disney raised Disney+ after a year or so of en masse $6.99 subscriptions.

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Game Pass has helped define a generation of Xbox services revenue growth.

Activision-Blizzard's IPs and franchises represent tremendous value in both content and earnings potential. The games, which are typically monetized live service titles, fit perfectly into the Game Pass business model and will synergistically fold into the Xbox business. With great value comes great cost and even greater direct-to-consumer fees.

ATVI has multiple high-profile billion-dollar IPs in its arsenal and even if most of them show up on Game Pass, the subscription's overall value will surge. That should be enough of a reason for a price hike.

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Call of Duty: Modern Warfare II

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* Prices last scanned on 6/7/2023 at 2:22 am CDT - prices may not be accurate, click links above for the latest price. We may earn an affiliate commission.

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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