TLDR;
This video discusses Microsoft's recent controversial decisions regarding Xbox Game Pass and the introduction of advertising within the Xbox ecosystem. It highlights the negative reactions to price hikes, the removal of DLC discounts, and the potential normalisation of intrusive advertising in games. The video also explores the history of problematic monetisation strategies in gaming and expresses concern over the future of the industry if these trends continue unchecked.
- Microsoft's Game Pass Ultimate price hike to $30 a month has been met with outrage and cancellations.
- Microsoft is testing ad-supported free Xbox Cloud Gaming with play limits.
- There are concerns about the normalisation of intrusive advertising in AAA games.
Introduction: Microsoft's Disastrous Week [0:00]
Microsoft has faced significant backlash recently due to changes in its Game Pass plans, including a substantial price increase for Game Pass Ultimate to $30 a month, leading to widespread outrage and cancellations. The company has also been criticised for hiding details, such as the removal of direct redemption of points for Game Pass subscriptions and paywalls for higher resolution xCloud streaming (1440p). Additionally, Microsoft has removed DLC discounts for Game Pass members, signalling a shift towards prioritising profit over consumer value.
The Domino Effect: Advertising in Gaming [1:31]
The next concerning trend is the rise of advertising in gaming, following the path of microtransactions, loot boxes, and battle passes. While advertising is prevalent in the mobile gaming sphere, there's fear it will become more intrusive in console and PC gaming. Xbox has already experimented with full-screen pop-up ads, and there have been instances of advertising for McDonald's on the Xbox dashboard, raising concerns about the future of gaming experiences.
Industry-Wide Trend: PlayStation and NBA 2K [4:02]
PlayStation has also explored the possibility of introducing ads in free-to-play games. NBA 2K faced significant backlash for unskippable advertising. Activision has also been criticised for incorporating advertisements into Call of Duty: Black Ops 6 and Warzone loadouts. The fear is that this could lead to a future where pausing a game brings up ads for unrelated products, or where players must watch ads to gain access to game time.
Microsoft's Testing of Ad-Supported xCloud Gaming [6:11]
Microsoft is reportedly testing free xCloud gaming supported by ads, with monthly play limits. This service would not require a Game Pass subscription and would include approximately two minutes of ads before a game is playable, with a limit of one-hour sessions and up to five hours free per month. While some may see this as a positive step for accessibility, it raises concerns about the normalisation of intrusive advertising and the potential for further exploitation.
Historical Context: Microsoft's Plans for Ad-Supported Gaming [7:37]
Microsoft has been planning ad-supported gaming for some time. In 2023, it was revealed that Microsoft was exploring offering free Xbox Game Pass streaming with ads, particularly targeting emerging markets like Africa and Southeast Asia. The idea was to allow users to watch a 30-second ad in exchange for two hours of game streaming. This strategy is seen as a way to reach millions of gamers who may not have access to consoles or high-end disposable income.
Past Experiments and Future Concerns [10:49]
Microsoft has been experimenting with ads in various ways, including integrating them into free-to-play games. While Microsoft claims it wants to provide more money-making opportunities for developers, there are concerns about the potential for a negative reaction from players. Microsoft intends to create a private marketplace where only select brands can insert ads into games in a way that doesn't disrupt the gameplay experience, such as digitally rendered billboards in racing games.
Leadership's Vision: Monetisation and Growth [12:55]
Sarah Bond has discussed the possibility of trading ad views for time slices of games, while Phil Spencer believes that new models of monetisation will help expand the audience for gaming globally. Spencer has mentioned the idea of players watching ads to earn currency to play games, drawing inspiration from internet usage models in countries like Africa. These ideas align with Microsoft's goal of reaching new players and opening up new player bases through innovative monetisation strategies.
Microsoft's Desperation and the Future of Xbox [16:49]
Xbox leadership presented a vision to Microsoft that involved acquiring studios, delivering top-tier exclusives, and increasing Game Pass subscriptions. However, due to various challenges, this vision has not been fully realised. As a result, Microsoft has shifted its strategy to include releasing games on multiple platforms and exploring new monetisation methods. The recent Game Pass price hike and the push for advertising suggest a sense of desperation, raising concerns about the future of Xbox and whether Microsoft will continue to invest in gaming.