New Xbox Game Pass games may be on hold if Microsoft freezes publishing deals

As CEO Asha Sharma resets the business, Xbox Game Pass may also undergo dramatic changes. Rumors have surfaced that Microsoft is cutting back on third-party deals for the subscription service. In a podcast hosted by Arrowhead Studios CEO Shams Jorjani, Fernando Rizo of Caboodle Games made the revelation.

Third-parties blindsided?

DayOne summarized the conversation from The Business of Video Games podcast. At the First Playable event in Italy, Rizo heard that studios anticipating deals “got the rug pulled out from under them”. He speculates that Microsoft has paused agreements while it reevaluates the service's future.

If Rizo is correct, players could see fewer new Xbox Game Pass games, at least from third parties. However, with contracts signed well in advance, any change may not have immediate impacts.

Microsoft continues to implement cost-cutting measures, including more rumored studio closures. In an effort to protect profitability, it also recently raised console prices again. By contrast, it reduced rates for the Ultimate and PC tiers, but new Call of Duty titles will no longer debut on day one.

Game Pass economics

Removing the shooter from the catalog addresses concerns that Game Pass cannibalizes sales. Still, with some AAA targets, the company reportedly pays more than $30 million dollars to compensate major publishers for lost revenue. Even if smaller and indie partners receive less, flat subscriber growth may hurt profits.

Rizo did not indicate that upcoming first-party titles like Gears of War: E-Day or Fable would be affected. Although there has been criticism of the day one approach, with a smaller library, they would become more essential additions. It’s also likely that announced new Xbox Game Pass games, such as Persona 6, will still appear on schedule.

Fans should consider the report unconfirmed until a Microsoft representative comments. Regardless, it would be the latest in a series of high-profile decisions as it contends with bleak finances.