The FTC slams Microsoft over this month's Xbox Game Pass changes

Earlier this month, Microsoft surprised many people with major changes to its Xbox Game Pass memberships. Now those alterations have caught the attention of the US Federal Trade Commission, which entered a filing about these changes to the US Court of Appeals for the Ninth Circuit today (via The Verge)

Microsoft not only increased prices for PC Game Pass and Xbox Game Pass Ultimate subscriptions last week, it also stopped new subscribers from signing up for an Xbox Game Pass Console plan. Later this year it plans to launch Xbox Game Pass Standard, which will offer subscribers online play and hundreds of games but with no Day One titles, which will now only be available via PC Game Pass and Xbox Game Pass Ultimate.

In its filing today, the FTC stated these changes were a consequence of Microsoft's acquisition of Activision Blizzard in October 2023. It stated:

Product degradation—removing the most valuable games from Microsoft’s new service—combined with price increases for existing users, is exactly the sort of consumer harm from the merger the FTC has alleged.

While Microsoft was able to legally close the deal to buy Activision Blizzard, the FTC filed for an appeal to that decision. The two companies met in court in December 2023 to debate their positions with the judges of that court. However, those judges have yet to render a decision in the case.

In February, the FTC submitted a filing to the same court, claiming that Microsoft's decision to lay off 1,900 of its gaming division's employees, including many Activision Blizzard team members was "inconsistent with Microsoft’s suggestion to this Court that the two companies will operate independently post-merger." It added that the layoffs "underscore the FTC's need for injunctive relief pending completion of the administrative proceeding." Hopefully, we will get a decision from the appeals court judges in the very near future.