Just as Microsoft announced their plan to include all their new In-House games in their Xbox Game Pass subscription service the same day they launch, Austrian retailer Gameware AT reacted by pulling all their Xbox One consoles, quoting that “Why would we wanna put in the work into selling their consoles, when Microsoft will be the only ones profiting from software sales.”
As Microsoft published their plans for Game Pass came as a surprise, especially for game retailers that make most profits through software sales. Console hardware is usually sold at a loss for the manufacturer and the retailer. This is usually remedied by software sales. A $60 dollar game has around $15 (or around 25%) worth of retailer margin.
“If they wanna earn the money themselves, they need to put in the work themselves.” says Gameware AT directed at Microsoft. Currently, they still have Xbox One games and accessories listed in their online shop. While this might be the most extreme reaction, they are not alone: GamesIndustry.biz spoke to retailers in the UK who are just as unhappy.
“Effectively overnight they’ve wiped massive value off our company and made it not worth doing,” says Stuart Benson from Extreme Gamez. They as well plan to stop stocking Xbox products.
Microsofts steps with their Game Pass could mean something else altogether: Due to Microsofts cross-play initiative, their new games aren’t Xbox One exclusive, indicating that Microsoft might change their focus from hardware sales altogether and shift towards a Netflix-like game subscription service.