In a recent interview, former VP of Xbox, Ed Fries, compared the service to Spotify and its impact on the music business, noting that people don't buy songs anymore.
Ed Fries, a former vice president of Microsoft's gaming division who has worked at the company for almost 18 years, shared his opinion on the growing popularity of Game Pass expressing his concern that the subscription service might negatively affect the gaming industry.
In an interview with Xbox Expansion Pass, Fries was asked what would he do if he still was a part of the company. The former VP didn't provide a specific answer, although he mentioned that one thing that makes him "nervous" is Game Pass. He explained that the subscription service "scares" him because of the impact it could have.
Fries went on to compare Game Pass with its "somewhat analogy thing", Spotify, which, according to him, influenced the music industry in a negative way.
"When Spotify took off, it destroyed the music business. It literally cut the annual revenue of the music business in half. And it's made it so people don't buy songs anymore."
Fries shared that he believes the gaming industry should not rely solely on subscription services, as this could lead to its collapse. Both Microsoft and Sony previously claimed that they think subscription services will never be the dominant model in the video games industry. Meanwhile, Fries warns that companies should be "careful" about choosing their business models.
"So we have to be careful we don’t create the same system [as Spotify] in the game business. These markets are more fragile than people realize."
He also shared that as a consumer he likes the subscription services like Spotify. "I have all the songs I’d ever want… it’s a great deal as a customer," he said. However, he still noted that "it isn’t necessarily great for the industry."
Although Fries admitted that, unlike music on Spotify, the number of games on Games Pass makes up just a small part of all the games sold, and most titles are currently only available in digital stores and retail.
"The percentage of all games that are on Game Pass is still tiny, and there are a lot of games. 200 games a week come out on Steam and more than that come out on mobile."
Following this interview, editor of Music Business Worldwide Tim Ingham disagreed with Fries' remarks about Spotify, arguing that the streaming service's impact on the industry has been overwhelmingly positive. He claimed that the annual revenue of the music business used to be cut in half due to piracy, and Spotify, on the contrary, provided users with a convenient and legal way to listen to music.
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