The Real Cost of Gaming Subscription Services

Developers going out of business isn’t the chief concern.

Gaming subscription services have been recently put under the limelight after Uplay+, Google Play Pass and Apple Arcade all launched this month, with other entries soon to follow. This put a significant chunk of the gaming audience on high alert–it’s not the first time a shift to a new business model has been specifically constructed to suck them out of cash. So while skepticism is warranted, the debate’s scope has so far been far too narrow to encompass all the range of concerns and potential benefits subscription services could have on a space as ripe for disruption as gaming.

The longest standing criticism of gaming subscriptions seems to be that it would swing the product appreciation pendulum so far in the other direction, that consumers start valuing games on the same level they do to any Netflix show on their TV screen–a game would become but an icon in a sea of other icons players can click on, and quit as easily as they can start them. There’s no doubt that games being perceived as part of a subscription bundle where each game costs a fraction of a cent would already do a great deal to further diminish their value. But what subscriptions could be particularly effective at, is leveraging their sizeable base to shift consumer attitude in such a way that playtime, or even downloads could become largely irrelevant — that’s where the economies of scale and the power of syndication come in.

When Microsoft first launched Xbox Game Pass — arguably the industry’s first earnest attempt at a game subscription service — the selection of games was that of recent-ish classics, but nothing terribly old. It fit that perfect zone of games that lots of people played when they initially came out, but very few were interested in buying after they exited the cultural zeitgeist. It’s from where Xbox Game Pass derived its greatest asset– it was a great way to play dozens of critically-panned classics that have come out on a reasonably-recent timeframe, without breaking the bank or feeling off-put by the sticker price no matter how low.

This created an environment where by leveraging the millions of subscribers Xbox Game Pass had, Microsoft was able to eke extra playtime out of games —some beloved by many — they wouldn’t have otherwise garnered. It can also conversely help a great sum of games to whom the algorithmic hellscape of digital-based distribution platforms has become more of a hurdle to clear than a convenience.

In the years following the indie boom back in 2012, no one has been quite able to replicate the success that classics like Super Meat Boy, Hotline Miami, Journey or even children of the Xbox Live Arcade era like Limbo and Bastion have had solely through the space being relatively vacant at that point. One of the ways game developers have been able to overcome the market saturation hoop, is to gamble their success on the possibility that someone like PewDiePie or Jacksepticeye might play their game, and hope the millions of views would eventually trickle down into sales. Gaming subscriptions have an opportunity to introduce that level of discovery on the platform level–wherein now if you had to watch a couple dozen streamers or YouTubers to keep a tab on the more interesting releases, you can in the future just offsource that curation to platform-holders instead.

That ecosystem however, introduces a very real possibility of imminent failure just like how Netflix has brought about the age of streaming, where each major filmmaking studio is not only seizing the means of production to their own content, but also the means to distribute it. In the not-so-distant future, if you want to watch an NBC show, you’ll have to sign up for Peacock–same goes for WarnerMedia, CBS, Disney, and other studios’ competing services. The worry here isn’t so much that gaming subscriptions will shrink the spoils for game makers — Apple and Google were rumored to have been subsidizing development cost for Arcade and Stadia titles respectively — it’s that the market will be so full of options, that consumers will inevitably have to make a choice and settle for the few they aim to use and could afford. It does not help that online video streaming services are already taking on the same pie, and it’ll eventually come down to priority-setting on an individual consumer basis to determine whether their current show-watching and game-playing cadence is sustainable at all.

If the outlook seems brighter for game developers at this current stage, there’s no guarantee that subscription-providers will stick to handing out millions of dollars to them upon first entry. Any developer below a certain threshold will either have to put out their games on Steam only to have it instantly buried beneath thick of layers of indistinguishable clutter, or mold their creative vision around the needs and wants of an Apple or a Google, or even a Microsoft. It’s not a great situation to be in, but in an environment where the gaming industry stands much of a chance of surviving a potential crash at all, it has to not pull any stops on guaranteeing financial security for its developers, regardless of what that might incentivize or otherwise dissuade them from making.

The greatest challenge for gaming subscription services so far seems to be a question of value. The market is on a sure way to further fragmentation — with publishers opting for their own distribution methods whenever possible — and it seems likely that if subscription providers like Apple, Google and Microsoft want to survive in this space, they’ll not only have to compete with each other, but they’ll also have to chip off the recent widespread adoption of subscriptions by other industries–especially in entertainment. There’s no telling if this will spell the end of games as we know them, but it’s a transition that industry consensus seems to have formed around already, so what’s only left now is to see the outcome.