Microsoft aims to be the Leader in the Video Game Market by 2030
In the video game market, Microsoft wants to become the true leader, which after all is in the purest logic of a technology multinational. Third player in sales of consoles (behind Sony and Nintendo ) and third again in revenue (this time behind Tencent and Sony ), Microsoft intends to become the leader of the sector… in just a few years.
The documents published during the ongoing process between the FTC and Microsoft/Xbox in the context of the acquisition of Activision Blizzard in fact reveal this ambitious goal:
“Our ambition is to become the industry leader in terms of overall revenue by 2030. That means doubling our total revenue in that time.”
The declared goal of being the leader in video games is very ambitious, but still far from unattainable on paper: Xbox actually boasts approximately 120 million active players, a number that includes Game Pass subscribers, but also simply Xbox players (not -Game Pass) as well as PC gamers who play a Microsoft Studios title at least regularly (Sea of Thieves, Forza, etc.). The number is impressive, but it masks a rather harsh reality: only a very small minority of these players subscribe to Game Pass (about 30 million).
Xbox is working hard to significantly increase the number of subscribers to its service, which necessarily involves great exclusive titles available on day one on Game Pass… hence the massive acquisitions of studios in recent years.
Game Pass now brings in $1 billion every quarter, which means Microsoft needs to reach 60 million subscribers to double its GP revenue, which again seems within reach with a total base of around 120 millions of players. Still, Xbox’s annual revenue is currently around 16 billion (more than Nintendo), while Sony and Tencent peak at 25 billion.
Very attractive video game brand
If raising an additional $4 billion a year (by doubling the number of Game Pass subscribers) would allow Microsoft to pass the $20 billion annual mark in the joint venture market, that would, however, remain insufficient to reach the $26 billion mark ( or more), and therefore surpass Sony and Tencent in turnover.
In fact, Game Pass will have to reach 100 million subscribers for Xbox to become the undisputed leader in the video game industry. Again, it’s not impossible, but to get the maximum conversion rate (Xbox to Game Pass ecosystem players), Microsoft will necessarily have to equip your Game Pass with a big exclusive cartridge every quarter, which is still far from being A reality.
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