Xbox Exec Explains How Game Pass and Netflix Differ

By Russ Milheim Posted:
Xbox Netflix Game Pass

Earlier this year, Microsoft made a move that sent shockwaves through the gaming communities when they bought Bethesda Studios. The $7.5 billion purchase brought huge franchises such as Elder Scrolls , Fallout , and Doom under Microsoft's exclusive umbrella. Microsoft has come under scrutiny in the past for have such a lackluster presence when it came to exclusives, especially when compared to their competitors in Sony. Their pruchase of Bethesa was one of their major public moves that seemingly aimed at addressing just that.

With Bethesda under their wings, not only will Microsoft own some of gaming's biggest franchises, but all of those franchises will be available on their Game Pass service. That means that the likes of Elder Scrolls 6 will be available to download for free, on launch, for those that are members. Such a big move would seemingly make people think that Microsoft is now turning their focus to first-party games to not only bolster their gaming library, but also strengthen their hit service in Game Pass.

In a recent interview with The Verge , Phil Spencer aimed to clarify things.


Phil Spencer, the executive vice president of gaming at Microsoft, was recently interviewed by The Verge. In the article, The Verge specifically asked about the thinking behind their recent studios aquisitions and if it was an attempt at having a full library of first-party content to start the engine of Microsoft's game pass subscription service, akin to what Netflix is doing with their business strategy. Among the many quotes, Phil had this to say:

Game Pass relies on third-party content. I want it to be that way. I want our third parties to have success. One of the things, going back to previous CEOs, Bill always had this good point of view that you’re not really a platform until other developers make more on your platform than you do. That’s one of the fundamental definitions of a platform. I think it’s very smart to look that way. I think about Game Pass as a platform. It’s not just a subscription on a platform.

Spencer addressed the "fundamental difference" between Game Pass and Netflix:

You’ve seen developers...start to come out and say, look, Game Pass is actually a critical part of the discovery process of my game. It’s actually created business opportunity for me. Which isn’t true in video and music today. Because when certain people try to call Game Pass the Netflix of, or the Spotify of, there is a fundamental difference...

These games are all for sale. What we’ve seen because, one, some games have a business model inside of themselves and there’s retail availability at the same time, and all these other platforms that games are on. One of the big issues that some of the mid-tier and smaller games deal with is, how do I just get known?

The Xbox head brought up Friends on Netflix as an example of how Game Pass can address growing user interest in particular content:

We can actually raise the visibility of the content. That’s just not true in the video space. There’s definitely some third-party series that I’ve found season 1 and 2 on Netflix. Then I’ll go to watch [it] on the studio’s service or even on broadcast, if it’s something that’s on broadcast. I just don’t think the video companies were there to catch that growth in Friends . You think about something like The Office or Friends or these things that were critical parts of Netflix growing, I think the opportunity that was missed there, and I’m not disparaging anybody, but if you’re going to grow a bunch of interest in Friends because it hit Netflix, what do you do with people’s interest when they get to the last episode that’s on Netflix?

Even things like EA Play coming on to Game Pass was us working with our partners at EA to say, it’s not about a per-title thing, let’s actually bring the channel that you guys want to go drive and grow value in, called EA Play. Let’s bring that to Game Pass on console and PC, so you see growth in people’s attachment to your service through the distribution power of Game Pass. That’s real strength for them.

Phil went on to drive the point home that Game Pass isn't about their first party games, but, first and foremost, their third-party partners. He describes the distribution and monetization capability of Game Pass as something that is accretive to their partners business' and important to Xbox's overall strategy. Phil also drew attention to a key critical component of Game Pass, which is the discovery process of their partner's games--something that plays a key role in how enticing the platform is for developers.


Game Pass is without a doubt the strongest aspect of what Microsoft brings to the table. It's something that not even Sony can rival- yes, not even the new Playstation Collection for Playstation Plus (which, dont get me wrong, is great in of its own right). There are quite literally no downsides to the service. Having hundreds of games, recent and new releases no less, at your fingertips at any moment for no additional cost is an unspeakable value.

To see Phil Spencer nail home the importance of the service is great, and hearing him talk so passionately about it in such detail makes it clear that we can only expect it to become an even better platform down the line. In the end, the more developers that see the platform as an enticing opportunity for their games, the more we as gamers win. One day, we could get to the point that nearly all games you could ever want to play (sans other console exclusives, of course) will either be on the service, or have rotated through at some point before.

Now, some might be a little disappointed to hear the emphasis on exclusives get dampened. Microsoft's lack of exclusives is certainly something that the gaming community has talked about throughout the years. It's important to remember though, that Microsoft clearly still has their eyes set on growing their first party offerings. I mean, they did just spend $7.5 billion to do just that.

- About The Author: Russ Milheim
Russ Milheim is the Industry Relations Coordinator at The Direct. On top of utilizing his expertise on the many corners of today’s entertainment to cover the latest news and theories, he establishes and maintains communication and relations between the outlet and the many studio and talent representatives.