Windows Central reported on Wednesday that Microsoft’s Project Largo is, in fact, a subscription deal called Xbox All Access. The story was subsequently backed up by Tom Warren, writing at the Verge. Microsoft has yet to officially comment, which means this is still a (well-sourced, official-sounding) rumor, but it’s an interesting one. Users of the All Access service would pay a monthly fee on a two-year contract to receive an Xbox One, an Xbox Live Gold subscription, and an Xbox Game Pass, all as part of the same bundle, and would be able to keep the hardware after the contract had expired.
You’d think something like this would’ve been the cornerstone of Microsoft’s Gamescom presentation, but instead, that was mostly about new content for State of Decay 2 and the imminent Forza Horizon 4. Reportedly, Microsoft is saving the All Access announcement for another time, as it’ll initially only be available to customers in North America, with the option to expand later.
The planned cost of a subscription to All Access, according to the original article, is $22/month for an Xbox One S, or $35/month for the more powerful, 4K-compatible Xbox One X. By the end of the two-year period, you’d have saved a small amount of money overall vs. the cost of buying the console outright, along with its attached subscriptions. You’d also have received the option to download free titles via the Games with Gold subscriber perk, as well as access to the downloadable, Netflix-style library from the Game Pass, which includes day-one access to all first-party Microsoft titles.
If All Access goes live in this format, it’d mark an interesting and potentially seismic disruption to the typical video game console’s sales model. Typically, consoles are sold according to a “razor and blades” model: the company often takes a significant per-unit loss on console sales, in order to make the money back on software. (Nintendo is an exception.) This rolls them both up into a single package, encouraging end users to take advantage of the digital services, which includes significant discounts and sales via Xbox Live and the Game Pass. in a lot of ways, this is the natural evolution of the “games as service” model that’s been driving a lot of the industry’s digital offerings for the last few years, and Microsoft has been transparent about its desire to focus on its services.
More importantly, shifting the price structure from a single big expensive purchase to a monthly subscription could theoretically open up a brand-new sales front for Microsoft. One of the big problems with video games has always traditionally been that they’re a luxury item, available only to those with a significant amount of disposable income. Changing the cost of entry for an Xbox from $229-$500 up front to $22-$35 a month puts it in the same entertainment tier as subscribing to cable TV. Granted, that also assumes the household in question has an HD-capable TV and broadband access, but you could do a lot worse with your entertainment budget than a monthly Xbox payment.
All Access is an interesting potential development for Microsoft, which is fighting to get out of third place in the console wars. It still has an ongoing problem with a lack of exclusives, but by offering new options to interested consumers, it could get a quick leg up on its competition by blowing up the current sales model and seeing what happens in the aftermath.
That being said, Microsoft tried this once before with the 360, in 2012, which didn’t do well at all then, but six years is a long time in the video game industry, and digital media has become much more common in the intervening period. This is a shot in the dark, but if it works at all, it could dramatically change how consoles and their games are made, sold, and marketed.