Microsoft’s Game Pass and the Future of Video Game Retailers

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Microsoft’s Game Pass has, understandably, caused a lot of excitement among gamers. One big aspect of this whole thing that is being left out of the equation: the impact on videogame retailers.

How will videogame retailers fare in the world of Netflix videogames?

We all know what happened to music stores, something many of us affectionately called CD stores, and could a similar fate come to videogame retailers?

The future of retail

Some retailers did not like the news one bit, and some indie retailers are threatening to discontinue carrying Xbox One games entirely.

Many retailers immediately acknowledge the appeal from a consumer standpoint, but are unequivocal in their belief that this kills their business.

Stuart Benson of Extreme Gamez in Leicestershire, UK said: “Why should we support them and sell their consoles and accessories if we’re going to get very little out of it? We don’t make anything off their digital selection. It’s pretty pointless. We might as well go where we’re supported, which is Sony.”

Gamers may recall when the Xbox One debuted that Microsoft planned to eliminate used game sales entirely. After a huge outcry from the community, the company reversed this decision, but has not let go of the dream.

Microsoft responds

Microsoft’s response to GamesIndustry.biz concerning these retailers was: “The response to the news thus far has been positive. As we noted in our announcement, our plan is to offer ways for select retailers to assort and promote Game Pass. In fact, we’ve been pleasantly surprised with the breadth of demand from retailers so far, and we’re considering if and how we broaden our distribution plans. We welcome feedback on our plans, and will continue to evolve our plans as appropriate.”

The coming digital-based, subscription business model is quite irresistible for many companies as it provides regular and reliable revenue. While the ownership is about access and not ownership, it might behoove Microsoft to remember the retailers that helped bring Xbox this far.

Will Steam join the fray?

Of course, the idea that this is an inevitable process perhaps kills any need to be politic about it all. And maybe it’s all overblown?

After all, Nintendo continually proves everyone wrong with concepts firmly rooted in traditional concepts of videogames while also providing levels of innovation that make it mountains of cash. The big test of this model will be whether Sony and Nintendo adopt it in the near future because without their buy-in it really isn’t going to work out quite the way many people think. In the PC space, watching what Valve does with Steam will also be interesting.

If Steam were to launch a subscription-based service then the tide is truly turning against retail, although time will only tell if this development emerges. Such a move on Valve’s part would also establish an interesting level of parity between PC and home consoles.

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