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Game Pass not replacing buying games, Spencer says

Head of Xbox says, “Transaction is bigger than subscription”

The head of Xbox, Phil Spencer, has said that while Game Pass is growing quickly, it’s not set to replace people buying games.

Speaking to the New York Times’ Sway podcast, the exec said that its “transaction” business – aka buying a game – is still bigger than subscription for the time being. Asked whether Spencer would define Game Pass as a Netflix for games, the Microsoft CVP agreed, though went on to say that users can buy whatever they are streaming.

“I’d say the difference for us is in the business model of — you can buy every game that’s available on the subscription, which is a little different than a music subscription or a movie subscription,” he said.

“But the technology itself to any person that hasn’t experienced it would feel like I’m watching a video. But if I click, the character on the screen actually moves. But yeah, it feels like Netflix. But we do — I think the option of allowing people to buy, it’s just been a traditional part of gaming. The retail market continues to be very strong and grow. So let’s make sure we offer our customers choice between subscriptions and transactions. That’s probably the only difference between us and some of the video subscriptions.”

He continued: “Transaction is bigger than subscription. Subscription is growing faster, just because it’s relatively new. And with Game Pass, we were one of the first movers in that space. But the transaction business is very large. We still sell physical disks.”

Microsoft recently rebranded Xbox Game Pass for PC as, well, PC Game Pass.

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