The founder of Arkane Studios, a subsidiary of Microsoft’s ZeniMax, says Game Pass is “unsustainable” following massive layoffs at Xbox. Raphael Colantonio, the founder of game studios such as Dishonored and Prey and currently the head of Wolfeye Studios, called Microsoft’s game subscription service the “elephant in the room” that hurts Xbox game sales.
Xbox Game Pass called ‘unsustainable’
“Why isn’t anyone talking about the elephant in the room? Ahem (Gamepass),” Colantonio said on X (formerly Twitter) on Saturday. The former Arkane president, who left the company in 2017, criticized the Game Pass model, which has been central to Microsoft’s gaming strategy for years, after the latest round of Xbox layoffs led to studio closures, project cancellations and layoffs.
Why isn’t anyone talking about the elephant in the room? Ahem (Game Pass)
— Rafael Colantonio (@rafcolantonio) July 5, 2025
“I believe Gamepass is an unsustainable model that has been increasingly damaging to the industry for a decade, subsidized by Microsoft’s ‘unlimited money’, but at some point, reality has to hit,” Colantonio added in response to his post. “I don’t think GP can coexist with other models, they either kill the others or give up.”
He claimed that the Game Pass economic model was flawed, noting that releasing games on Game Pass hurt sales on day one. All first-party Microsoft games launch on the first day of the subscription service, allowing members to play new games for free.
Game Pass Value
While Game Pass does provide value to gamers, the service has received criticism from within the gaming industry in the past. The service provides visibility for smaller indie games, but could ultimately hurt sales of newly released games. Back in 2023, former PlayStation boss Jim Ryan claimed that video game publishers agreed that Xbox Game Pass was “value destructive” while testifying at the Federal Trade Commission’s trial over Microsoft’s acquisition of Activision.
While using Game Pass can impact unit sales of new games, some games have been commercial successes despite launching on the service on day one. “Clair Obscur: Expedition 33” is a critically acclaimed turn-based role-playing game from French developer Sandfall Interactive. It launched on April 24 and, despite being available for purchase on Game Pass, sold more than 3.3 million copies in just over a month after release.
In April, Rebellion Developments’ CEO said the launch of the studio’s action-survival game Atomfall on Game Pass was a huge success. The game was released in March and has more than 2 million players.
Xbox layoffs
Last week, Microsoft laid off about 4% of its workforce — more than 9,000 employees. The layoffs are a heavy blow to the Xbox division, with Candy Crush developer King, Call of Duty developers Raven Software and Sledgehammer Games, Halo Studios and Forza Motorsport developer Turn10 Studios reportedly all affected.
As part of the layoffs, Microsoft also canceled the Perfect Dark reboot and shuttered developer The Initiative. Rare’s action-adventure game Everwild has also been canceled, along with several unannounced projects.
The Seattle Times reported that Microsoft’s latest round of layoffs may represent the company’s efforts to cut costs as spending on artificial intelligence surges. The Xbox parent company plans to invest more than $80 billion (approximately Rs. 6,87,456 crore) in artificial intelligence infrastructure next year.
