Microsoft has responded to the FTC’s claims about its Game Pass subscription changes, following its acquisition of Activision. The FTC filed a motion stating that Microsoft’s recent price increase and service restructuring demonstrate market power abuse.
Microsoft’s detailed rebuttal was presented in a letter to the US 9th Circuit Court of Appeals.
New Game Pass Standard: Value or Degradation?
Microsoft asserts that the new $14.99 per month “Game Pass Standard” subscription offers improved value for gamers by including access to a library of older game titles and online multiplayer functionality. Previously, this multiplayer feature required a separate $9.99 monthly subscription. The company refutes the FTC’s characterization of this tier as a “degraded” product.
“It is wrong to call this a ‘degraded’ version of the discontinued Game Pass for Console offering,” Microsoft stated. “That discontinued product did not offer multiplayer functionality, which had to be purchased separately for an additional $9.99/month (making the total cost $20.98/month).”
Game Pass Ultimate: Justifying the Price Increase
Microsoft also defends the $3 increase for Game Pass Ultimate, now $19.99 per month, by promising access to new game releases like Call of Duty on launch day. This, they argue, adds significant value to the service. Microsoft criticizes the FTC for shifting focus to Game Pass subscriptions after the district court dismissed the idea that Microsoft would withhold Call of Duty from Sony’s consoles.
“The FTC barely mentioned subscription at trial, instead focusing on the theory that Microsoft would withhold Call of Duty from Sony’s console,” the letter reads. “The district court correctly rejected that theory, which is now further eroded by Microsoft and Sony’s ten-year agreement to keep Call of Duty on PlayStation – a contract Sony was ‘thrilled’ to enter.”
How Does This Affect Competition?
Microsoft emphasizes that there is “no evidence anywhere” of harm to competition and notes that Sony’s subscription service continues to thrive despite lacking new day-one game releases.
From a gamer’s perspective, some of Microsoft’s arguments appear debatable. Highlighting online multiplayer, a standard feature on PC and included in Sony’s PSN subscription, as a key benefit seems outdated in 2024. Additionally, comparing the new $19.99 Game Pass Ultimate price to the previous combined cost of Game Pass for Console and Xbox Live Gold, which totaled $20.98, shows only a minimal saving.
The court’s decision on these arguments is pending. However, Microsoft has made it clear they intend to vigorously defend their position as regulators intensify scrutiny around the game subscription market.
Featured Image courtesy of Chesnot/Getty Images
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