The former founder of Arkane Studios—now owned by Microsoft—and current President & Creative Director of WolfEye Studios, Raphael Colantonio, recently took to Twitter to highlight what he calls the “elephant in the room” regarding many of Xbox’s issues: Xbox Game Pass. Here's what he had to say about the subscription model that gives players access to a large library of games for a monthly fee:

“I think Gamepass is an unsustainable model that has been increasingly damaging the industry for a decade, subsidized by MS’s “infinite money”, but at some point reality has to hit. I don’t think GP can co-exist with other models, they’ll either kill everyone else, or give up.”

This sparked a reply from Larian Studios (known for Baldur’s Gate 3), specifically their Director of Publishing Michael Douse:

"What happens when all that money runs out?" is the most vocal concern in my network, and one of the main economic reasons people I know haven't shifted to its business model. The infinite money thing never made any sense.”

Douse and Colantonio then continued discussing how Game Pass does, in fact, negatively impact game sales despite what Microsoft has previously suggested. Douse expressed that he favors Sony’s approach with its “l(fā)ifecycle management strategy.”

At its heart, the concept behind Xbox Game Pass is to allow subscribers to play first-party Xbox titles on day one. Even as Xbox titles begin appearing on PlayStation, those versions are either paid or released after a delay, which Microsoft believes still makes Game Pass appealing.

The issue becomes more complex when third-party developers are included in Game Pass launches—a practice that seems to be happening less often over time. This is where Microsoft steps in with financial support to offset potential lost revenue, a move many see as being financially unfeasible long-term—especially in light of recent layoffs and studio closures.

In recent years, Microsoft has heavily emphasized Xbox Game Pass subscriptions, pushing the service much harder than its declining hardware sales. Game Pass saw a major spike in subscriptions during the pandemic, but growth has since slowed, suggesting a limit to its expansion is approaching. While Microsoft continues to view Game Pass as its central selling point, it’s becoming increasingly difficult to convince non-first-party studios to adopt the model. Whether this changes or these challenges become permanent remains to be seen.

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