MicroSoft Takes Another Turn With Move to Bring ‘Call of Duty" Microsoft's gaming strategy has taken a significant turn with the reported move to bring Call of Duty to Xbox Game Pass. The Wall Street Journal reported that Microsoft ( NASDAQ:MSFT ) plans to debut 2024's new Call of Duty at next month's Xbox Games Showcase, alongside the announcement that it will be available on Game Pass on its launch day. Microsoft's bet seems to be that Call of Duty on its Game Pass subscription service will spur a new wave of interest in both the service and the Xbox as a platform.
While rumors persist that Microsoft ( NASDAQ:MSFT ) will raise the price or add new tiers to Game Pass in the near future, it would still let a single person play the new Call of Duty for a couple of months for less than the $70 cost of the base game. This could cannibalize the game's overall sales, particularly on the Xbox platform. In theory, this could authoritatively confirm or deny Microsoft's portrayal of the Game Pass service as a "discovery engine," where players frequently try games before they buy them. This could bring in a new wave of interest from people who might otherwise never have tried a new Call of Duty or might give a few million casual players an excuse to not buy this year's edition of the game.
As we learned last summer during Microsoft's court battle with the FTC over its Activision acquisition, Call of Duty by itself makes up a non-trivial amount of the video game audience. If Microsoft had simply decided to make Call of Duty a console exclusive on Xbox, it would have pulled roughly 7 million players away from Sony's PlayStation 4 and 5 systems. Instead, the reported plan is to let the game stay cross-platform, but to use it to drive Game Pass subscriptions.
The Call of Duty gamble, if it happens, would be the latest in a series of recent Xbox controversies. Microsoft's gaming arm was in good shape at the start of the year, with Xbox topped Windows in revenue for the first time, and its major competitors on console didn't have much left in the tank. Microsoft then announced earlier this month that it would shutter several of its studios, all of which were subsidiaries of Bethesda Softworks. This was the latest in a series of layoffs and shutdowns that has ravaged the international video game industry for the last 18 months, including 1,900 lost jobs at Xbox in January.
It's unlikely that next month's Showcase and the attendant Call of Duty reveals are a make-or-break moment for the Xbox project overall. Instead, it's more likely that Call of Duty on Game Pass will be a final test for Xbox's current operational strategy. If this falls through, the next move is a big executive shakeup, followed by a series of new initiatives. The upcoming year will either vindicate or vilify Spencer's time as head of Xbox, which could either take Call of Duty down a peg or lock it in place as the most valuable IP in the modern games industry.
