Last week, Microsoft drew the ire of gamers by quietly announcing a price increase for all Xbox Game Pass subscriptions and introducing the Xbox Game Pass Standard. This new subscription, which includes online play but loses access to Xbox games directly on the day of their release, is controversial and has now attracted the interest of the FTC, which is once again attacking Microsoft.
Read also: Price increases, day one games with conditions… Is Xbox sabotaging Game Pass?
FTC Sues Microsoft Again
In a document In a lawsuit filed with the U.S. Court of Appeals for the Ninth Circuit, the Federal Trade Commission (FTC) is denouncing the price increase for Xbox Game Pass and calling the new Xbox Game Pass Standard subscription a “degraded product” because Game Pass members can no longer sign up for Xbox Game Pass Console, which includes access to day one games in the service.
Microsoft's price increases and product degradation – combined with Microsoft's reduction in investment in production and product quality through layoffs – are hallmarks of a company exercising market power after the merger.
In its appeal, the FTC says removing day-of access to Xbox games from the new Xbox Game Pass Standard subscription, combined with price increases for existing users, is exactly the kind of consumer harm the merger caused that the commission fought against last year.
The product degradation, which involves removing the most valuable games from Microsoft's new service, combined with price increases for existing users, is exactly the kind of consumer harm the merger has caused that the FTC has alleged.
What impact for Xbox?
As stated by The Vergethe FTC's request is part of its appeal of the court's decision not to block Microsoft's acquisition of Activision-Blizzard.
While the merger was validated last October, the court has not yet ruled on the FTC's appeal, and it is hard to imagine it coming back to the subject anyway. This could also be detrimental to Microsoft, particularly in the context of potential new acquisitions.
With its recent decisions, the company has indeed proven that its promises cannot really be believed, as evidenced for example by this statement affirming that the price of the Xbox Game Pass would not increase following the acquisition of Activision-Blizzard, while it has increased by almost 40% since then.