The US Federal Trade Commission has expressed dissatisfaction with Microsoft's new pricing policy for Xbox Game Pass, calling it a deterioration in the quality of service for consumers. This announcement comes in light of ongoing litigation over Activision's acquisition of Blizzard.
Game Pass Criticism
FTC Dissatisfaction
US FTC Commission (FTC) sharply criticized Microsoft Corporation, condemning its recent changes in the tariff schedule of the Xbox Game Pass service. The regulator described the new tariff plan as a “degraded product,” expressing its opinion in an official appeal to the US Court of Appeals for the Ninth Circuit.
Subscription changes
Microsoft recently announced an increase in the cost of PC Game Pass and Xbox Game Pass Ultimate subscriptions, and also introduced a new Game Pass Standard tariff. This decision caused a negative reaction from the FTC. The Commission believes that the new Game Pass Standard tariff represents a worse user experience by preventing new subscribers from gaining access to Game Pass for Console for $10.99, which includes immediate access to new titles on the day of their release.
Tariff comparison
The new Xbox Game Pass Standard plan will cost $14.99, but will not provide instant access to new releases. Instead, it will include online multiplayer capabilities. The FTC considers this to be a deterioration in the quality of services while increasing prices.
FTC Position
In its statement, the FTC emphasizes: "Microsoft's price increases and product quality declines, along with decreased investment in product development and product quality due to workforce reductions, are signs of a company abusing its post-merger market position."
Context of the Proceedings
This appeal is part of the FTC's ongoing appeal of a district court's decision that refused to block the company's purchase of Activision Blizzard Microsoft last year. Although Microsoft completed the $68.7 billion deal in October 2023, the Ninth Circuit Court of Appeals has yet to issue a final decision on the FTC's appeal.
The essence of the complaints
The FTC's main criticism is that the removal of valuable gaming content from Microsoft's new service, combined with an increase prices for existing users is precisely the kind of consumer harm from the merger that the FTC has previously warned about.
Glossary
- The FTC (Federal Trade Commission) is an independent agency of the US government charged with protecting consumer rights and monitoring compliance with antitrust laws.
- Microsoft is an American multinational corporation specializing in the development of software and Xbox game consoles.
- Xbox Game Pass is a video game subscription service for the Xbox and PC platforms.
- Activision Blizzard is a large video game developer and publisher recently acquired by Microsoft.
- The United States Court of Appeals for the Ninth Circuit is a federal appellate court with jurisdiction over several western states of the United States.
Links
Answers to questions
What changes Xbox Game Pass Pricing Draws FTC Criticism?
Why did the FTC call the new Game Pass Standard a 'degraded product'?
How does the FTC criticism relate to Microsoft's acquisition of Activision Blizzard?
What arguments does the FTC make in its appeal to the Court of Appeals?
What is the current status of the deal between Microsoft and Activision Blizzard?
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Discussion of the topic – Xbox Game Pass under attack: FTC criticizes Microsoft for “degrading” the service
The US Federal Trade Commission accused Microsoft of deteriorating the quality of Xbox Game Pass after changing its pricing policy and introducing a new tariff. The FTC called the new plan a "degraded product," expressing concern about the company's actions.
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Isabella
What news! Microsoft is clearly going too far with the new tariffs. To me, this is just a way to squeeze more money out of players. 🤔
Hans
I agree with you, Isabella. But let's look at it from another perspective - maybe this will allow them to invest in developing better games? 🎮
Pierre
Hans, you are an optimist! 😄 But I doubt it. Most likely, this is simply an attempt to increase profits after purchasing Activision Blizzard. I wonder how this will affect the market as a whole?
Sofia
Guys, don’t you think that this may be due to the general increase in prices in the gaming industry? Game development is becoming increasingly expensive, and companies need to somehow offset the costs.
Giovanni
Ha, another corporation is trying to profit from ordinary players. Nothing new. It used to be better - you bought the game and played. And now these endless subscriptions and microtransactions. Ugh!
Isabella
Giovanni, don't be such a pessimist! 😉 Subscriptions also have their advantages - access to a large library of games for a reasonable price. But I agree that raising prices is too much.
Andrzej
But it seems to me that Microsoft is simply testing the market. If players do not accept the new rates, they can always roll back the changes. The main thing is to let them understand that we do not agree to overpay. 💪
Olena
I wonder how competitors will react to this? Maybe Sony and Nintendo will take advantage of the moment and offer better terms for their subscriptions? It would be great! 🎉