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Highlights
- Xbox plans to launch its own mobile storefront to expand its presence in the mobile games market after acquiring Activision Blizzard.
- Activision Blizzard’s mobile titles like Candy Crush and Call of Duty Mobile are extremely profitable, and the profitability of the mobile games sector is expected to continue growing.
- Xbox faces challenges due to Apple’s regulations on in-app purchases and third-party application stores, but Xbox CEO Phil Spencer is confident that the launch of the mobile storefront is not far away.
Xbox is aiming to expand its presence in the mobile games market by releasing its own digital storefront on smartphones. These plans follow Xbox’s acquisition of Activision Blizzard, a deal that is a key part of the company’s strategy as it competes with PlayStation.
Acquiring Activision Blizzard has been significant for Xbox, as the mammoth publisher’s console and PC offerings include franchises like Call of Duty, World of Warcraft, and Overwatch. However, Activision Blizzard’s mobile titles are perhaps even more significant, with exceptionally profitable games like Candy Crush, Hearthstone, and Call of Duty Mobile falling under the company’s banner. Mobile games raked in over $100 billion in 2022, dwarfing the profits earned from console and PC games, and the sector’s profitability is expected to continue growing. It should be noted that Candy Crush has consistently ranked among the most successful mobile games, raking in over $1 billion in 2022, making it one of the most valuable franchises owned by Xbox following the Activision Blizzard deal.
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As reported by Bloomberg, Xbox CEO Phil Spencer commented on the company’s mobile strategy at the CCXP convention in Sao Paolo. Spencer noted that Xbox is working with partners who are interested in “more choice” on mobile platforms, who will help usher in Xbox’s new mobile storefront. He also commented on the timeline for this project, stating, “I don’t think this is years away, I think this is sooner than that,” suggesting that the launch of the storefront may be relatively near.
Xbox faces a few challenges in this area, the most significant of which are the regulations in place on Apple devices. Epic Games has been famously battling Apple over the App Store’s 30% cut on in-app purchases, which massively cuts into the primary form of monetization for mobile games. While Epic’s suit against Apple resulted in a ruling that the former would have to allow for third-party purchase options, the company still does not allow for third-party application stores on its devices. Google also charges publishers a 30% fee on every in-app purchase, but does allow third-party app stores on its devices.
The Ninth U.S. Circuit Court’s decision to support Apple’s current practices may not bode well for Microsoft, as it leaves a hurdle in the way of its mobile marketplace ambitions. Spencer’s comments about choice may be read as a direct challenge to Apple’s restrictive policies, so it will be interesting to see if and how the two tech giants come to an agreement on the matter of an Xbox mobile store.
