Xbox Game Pass price increase vindicates ex-FTC chair who opposed Activision Blizzard acquisition

After Microsoft acquired Activision Blizzard in 2023, some gamers celebrated the expanded Xbox games catalog. However, former FTC chair Lina Khan had concerns about the deal’s impact on consumers. Following another Xbox Game Pass price increase, Khan commented on social media. She reminded audiences why the FTC launched an unsuccessful court challenge.

Khan replied to a post from Lee Hepner, who illustrated the rising subscription rates of Game Pass. She noted how, following the acquisition, studios have closed and the costs of some products have skyrocketed. Khan explains that “increasing market consolidation and increasing prices often go hand-in-hand”. With Microsoft’s marketplace dominance, it's “too-big-to-care” about the negative effects on buyers.

Many critics point to a promise Microsoft made during court proceedings in 2023. The company dismissed the notion that the deal would lead to price increases for Xbox Game Pass. Just a few years later, the Ultimate tier now demands $29.99 per month, while lower levels have fewer benefits. When combined with pricier Xbox consoles, analysts attribute the high costs to the merger and poor business decisions.

Rising prices aren't exclusive to Xbox gaming

Khan was correct about many of the ramifications of the Activision Blizzard deal. Still, Microsoft defenders may point out that some of the FTC’s predictions haven’t materialized. The U.S. federal agency had worried that the company could exploit its position to harm competitors like PlayStation. However, instead of Xbox games like Call of Duty becoming exclusives, they are more readily available on the PS5.

PlayStation has faced its own accusations of anti-competitive practices. Consumer groups believe that the PS Store blocks rivals from selling cheaper digital games. Whether or not tariffs are fully to blame, Sony has also hiked the price of PlayStation Plus subscriptions and PS5 systems.

Meanwhile, Nintendo sells the original Switch and newer games and accessories for inflated MSRPs. Nevertheless, at the moment, Microsoft is bearing the brunt of consumer dissatisfaction.