In a revelation stemming from the FTC v Microsoft case, it has come to light that Microsoft sought the expertise of metaverse pioneer Matthew Ball to bolster its Game Pass subscription service. Matthew Ball, a former strategist at Prime Video, was engaged to provide insights and refine plans surrounding Xbox Game Pass.
According to the disclosed email chain, Ball delivered a comprehensive 13,000-word white paper to Microsoft, delving deep into the intricacies of subscription models. One noteworthy excerpt from this white paper underscores the growing significance of blockbuster titles within a subscription-based ecosystem. Ball argues that, within a subscription framework, popular games attain heightened value, disrupting the traditional linear relationship between content consumption and revenue.
This perspective becomes particularly pertinent when analyzing Xbox Game Pass in light of the Microsoft-Activision merger. During the FTC v Microsoft trial, Phil Spencer, CEO of Xbox gaming, was pressed on the valuation of Activision. While the exact figure remained undisclosed, it was revealed that the value of Activision surpasses Microsoft’s proposed $68.7 billion acquisition price. This underscores the emphasis Game Pass places on long-term engagement and recurring revenues, aligning with Ball’s insights.
Seeking advice from industry experts is a standard practice in diverse sectors, and Microsoft’s collaboration with Ball is no exception. Like many others, Microsoft grappled with unprecedented challenges during the COVID-19 pandemic, prompting the pursuit of external perspectives to navigate the evolving landscape. It appears that Ball’s recommendations have borne fruit, as evidenced by the significant surge in Xbox Game Pass subscriptions, which grew from 10 million in Q4 FY20 to 15 million in Q1 FY21.
In summation, Microsoft’s partnership with metaverse luminary Matthew Ball underscores the corporation’s dedication to optimizing its Game Pass subscription offering. By consulting with industry visionaries and exploring innovative subscription models, Microsoft endeavors to elevate the value and attractiveness of its gaming services.
