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Home»Technology»GamesBeat Summit 2025: Finding new ways for the industry to grow
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GamesBeat Summit 2025: Finding new ways for the industry to grow

Editor-In-ChiefBy Editor-In-ChiefMay 29, 2025No Comments4 Mins Read
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The days of double-digit growth in gaming are over. But there are still ways to expand the market if companies start thinking outside of the traditional business models. 

At GamesBeat Summit 2025 in Los Angeles, behavioral game economist Catalin Alexandru, Wedbush Securities managing director Michael Pachter, and Alinea Analytics’s head of market research Rhys Elliott had a lively debate about the industry’s woes and how it could find new opportunities for growth. 

Pachter compared the current state of the gaming industry to where the movie and television industries were in the 1960s, back when people could only view programming either in theaters or on TV. Nowadays we have a wealth of options to watch that content, whether it’s through on-demand services, streaming subscriptions, or YouTube. 

“There’s just lots of ways to access that type of content. And I think the games industry is about to embark upon a new way of accessing games — I think that’s ad-supported,” said Pachter. “So we are not yet at an ad-supported business model that actually works for games, but I think it’s coming. And when that happens, you’re going to expand the market even further.”

He brought up how successful Netflix has been with the addition of its ad-supported plan, which now has 70 million subscribers globally. He said Microsoft should consider something similar and offer an ad-supported version of Xbox Game Pass at a cheaper price. If the company offered an ad-supported plan that cost $7.99 per month, he theorized, it could attract twice as many subscribers.

He also didn’t understand why Microsoft hasn’t added any of its mobile games to the service yet. He wants to see a future where all these forms of entertainment — games, movies, TV — can be found on one platform.

“But why is Candy Crush not on Game Pass? Why is Diablo Immortal not on Game Pass? Why is Call of Duty: Mobile not on Game Pass? And it’s because nobody at Microsoft has thought of it and they won’t, because there’s no original thought there,” said Pachter, eliciting some laughs from the crowd.

And if Game Pass doesn’t make the move into this all-in-one future, he believes Netflix will.

“[Microsoft] can’t do this if the same old guys continue to run the business the way they’ve always run it. They need young, new punks that think differently, and if they think differently, they have a chance to win. And to be honest, I actually think Netflix is going to win,” said Pachter.

Netflix has steadily acquired studios and added games to its streaming service in recent years, but it hasn’t yet dipped into console and PC games. If it can add those types of games to its platform with a developer-friendly revenue sharing model, then he thinks they have a real shot of expanding the market and becoming the next huge player.

But the subscription business model isn’t without its faults either. Elliott noted that unlike Spotify or Netflix, where people can consume a lot of songs and videos in a single month, most consumers can only play one or two games in that same time frame just because of how much longer it takes to finish a game. And that’s not considering other factors like free-to-play games stealing some of that free time, too.

Alexandru said that the Game Pass model has “already proven not to be a silver bullet” because a lot of people have huge backlogs of games on Steam and other platforms. And due to other built-in features like Steam Curators and friends lists, he finds it hard to imagine a lot of people switching to Netflix, even if developers end up getting a greater share of revenues.

“This is what you have to overcome in order to get the flywheel going on Netflix. And once you get the flywheel going on Netflix, you’ll just move that monopoly from A to B,” said Alexandru.

Make sure to check out the full video for more on their thoughts during the hour-long panel, including the future of live-service games, creeping budgets in triple-A, and what effect the Nintendo Switch 2 and Grand Theft Auto VI will have on the industry.

GB Daily

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