Microsoft’s Store Fee Change Could Come to Xbox Too

Posted on May 2, 2021 by Paul Thurrott in Games, PC gaming, Xbox, Xbox One, Xbox Series S, Xbox Series X with 10 Comments

Microsoft’s decision to reduce its fees for game developers in its mobile store in Windows 10 wasn’t all that momentous. But it turns out that was just part of the original plan: As recently as January, the software giant planned to drop its game-related fees to 12 percent on Xbox consoles too. And that change would put some real pressure on mobile app store providers like Apple and Google. Not to mention its peers in the videogame market as well.

Will it still happen? Maybe.

The bad news? Microsoft says no. For now.

“We have no plans to change the revenue share for console games at this time,” a Microsoft statement claims.

But that wasn’t always the case and, if we’re lucky, it could still implement a change it was planning back in January when it provided internal documentation as part of the looming Epic v. Apple trial that explains it was planning to lower game-related fees on Xbox to just 12 percent as well.

“App stores have become a critical gateway to some of the world’s most popular digital platforms,” the Microsoft documentation explains. “We and others have raised questions and, at times, expressed concerns about app stores on other platforms. However, we recognize that we should practice what we preach.”

As part of a set of 10 guidelines it publicly announced in October 2020 and were designed to “promote choice, ensure fairness, and promote innovation,” Microsoft said that it was planning to do away with policies for which Apple, in particular, is finally being held accountable. It would not block apps because developers choose rival payment systems, for example, and would hold its own apps to the same standards to which it holds competing apps and be “transparent” about its rules and policies. And it will not block competing app stores on Windows.

But the bigger news, which it just announced this past week, is that Microsoft was planning to drop its game-related fees on Windows 10 from the arbitrary but industry-standard 30 percent to just 12 percent. That change to an 88/12 revenue split was just announced this past week.

But that same document also shows that Microsoft was planning to drop its game-related fees on the Xbox console as well. These types of fees cover one-time game purchases, subscriptions, and all in-game digital content (or what’s called downloadable content, or DLC). “All games will be moved to [a] 88/12 [split] in CY21,” the documentation says.

That bit is good news because it means that it could still happen. And if you read the Microsoft statement above, you can see that it specifically notes “at this time.” There are still 7 months to go in 2021.

Further helping matters, the change to an 88/12 revenue split for the Microsoft Store in Windows 10 was listed as happening in “H1 CY21,” which means the first half of 2021. And that change did happen on the stated schedule.

So this could still be happening, folks. And if it does, it will help influence a similar revenue split on other app and game store platforms. Not to mention making it difficult for regulators, judges, and juries to look the other way when it comes to Apple’s (and Google’s) unfair fee structures.

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Comments (10)

10 responses to “Microsoft’s Store Fee Change Could Come to Xbox Too”

  1. Avatar

    bluvg

    “App stores have become a critical gateway to some of the world’s most popular digital platforms,” Yet they've done little to quell doubts about the future of their own Store for Windows.
  2. Avatar

    beckerrt

    If they do, any chance that helps them against Sony in the console race?
    • Avatar

      Paul Thurrott

      I don't see anything changing with regard to console sales no matter what they do.
    • Avatar

      saqrkh

      Microsoft's wants in on the gaming market as a whole now, not just consoles. Its focus will likely be on getting more Game Pass subscribers, especially on mobile and PC.


      MS wants to attract those companies and developers to Game Pass, so the fee cuts are a gateway (along with possibly subsidizing games and other incentives).


      That said, I think console and PC should be fairly aligned now given they're on the same hardware architecture. So, efforts in one should translate to the other.


      Mobile is a tougher nut to crack. You have a huge variety of games that can technically be 'mobile' -- e.g., the Pokemon GO-type games, endless runners, co-op/community games, RTS, battle royale, and even full-out experiences like we see on the Nintendo Switch.


      MS also has a lot of studios now, but they won't cover all of those areas, so they need as many outside developers as possible too.

  3. Avatar

    scovious

    Epic games deserves a lot of credit for getting the ball rolling for fair treatment of developers whose creations power the platforms they are on and determine their success. The first companies to make this change buy a lot of good will, and the holdouts will only mar their reputations in the long run.
    • Avatar

      bettyblue

      A lot of good will with whom? Developers? Consumers of apps/games wont a know a difference at all. The developer will get a more of the larger portion of the app/game sale and that is it.


      No developer is going to ditch a store if one cost more to do business. The only way they will do that it if there is not money to be made in it.....like the Windows store.

  4. Avatar

    ghostrider

    MS after a bit of positive free publicity when Apple and Google are under the spotlight for their charges. MS have done this before, but as no-one really uses the Windows store, I can't see it making much real-world difference.

    • Avatar

      rm

      Actually, If MS can reduce the percentage with a lot lower value of downloads/sales/transactions, that means Apple and Google are making even bigger margins because they don't have competition.

  5. Avatar

    IanYates82

    I'd read elsewhere about this that the revenue split may be an option to devs who choose to license their game for cloud play. That's a nice carrot and consumer friendly - everyone (dev, Microsoft, user) wins from that.


    It'd be interesting to see if MS can start getting cloud licences for regular xbox games that you own but aren't in game pass. That would really open things up, although the set of games in Game Pass itself is pretty good.

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