Game Pass won’t be interfering with any exec’s bonus again (Picture: Microsoft)

Xbox growth continues to disappoint, and interfere with its exec’s pay bonuses, as Microsoft’s CEO stops counting Game Pass entirely.

As Microsoft completes its $69 billion acquisition of Activision Blizzard , CEO Satya Nadella has said the companying is ‘doubling down’ on gaming and that ‘When I think about Microsoft, I think of perhaps developer tools, proprietary software, and gaming. Those are three things that we’ve done from the very beginning,’

That’s so patently untrue it’s baffling as to why he said it. Apart from publishing a few flight sims and casual games on PC, the original Xbox in 2001 was Microsoft’s first real engagement with the industry – 26 years after it was founded.

It’s impact on the industry has been considerable but the Xbox has never been very successful outside of the US and UK, and even then has always been beaten by PlayStation. Game Pass was to have been one of the key weapons in their fight against Sony but there’s now signs that it’s importance may be lessening.

Although Game Pass is excellent value for money, for years it’s been clear that it hasn’t been performing as well as Microsoft hoped. It’s not just a problem with Game Pass though, as reports suggest PS Plus has been having similar problems, with subscriptions stalling no matter the format .

Although Microsoft only rarely reveals subscription numbers for Game Pass, for the past two years it’s missed growth targets by a considerable margin, causing Xbox boss Phil Spencer to miss out on his company bonus .

Nadella’s bonuses were also tied into it, as an indication of general Xbox growth, but this year the KPI (key performance indicator) has been removed, implying that the targets have been missed again.

Instead, the success of Xbox is being measured simply by the increase in revenue growth for the division.

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That might not be easy to meet either though, as the growth target this year for Xbox was 4.4% and yet in the end it was only 0.7%, according to Microsoft’s new quarterly financial results .

That is exactly why Microsoft was so keen to buy Activision Blizzard and it may be that once their games start to appear on Game Pass, which is likely to happen early next year , its fortunes may change.

At the moment though there’s little evidence that Game Pass, or PS Plus, drives hardware sales or that it is a particularly popular way to pay for and consume games with general audiences.

Not the silver bullet that was imagined (pic: Microsoft)

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