As the focus of sales shift to online and digital becomes more prominent (and more pushed by publishers), the woes of physical retail has become a big thing. Wrap that all up with the current COVID pandemic, and you have nothing but a hard time. The last major video game-focused retail specialty chain, GameStop, has been no stranger to those woes, as they’ve been forced to close multiple stores as well as seen slumping sales. But a new partnership with Microsoft has been announced, and it seems that the retail chain isn’t going down without some fight.
As reported by DOMO Capital, GameStop has entered a deal with Microsoft to share downstream revenue from digital sales on Xbox systems that GameStop sells. While the exact details are not known, it seems as if the retailer will get some degree of revenue on all digital content from whatever systems they sell that will get customers into the “Xbox ecosystem.” That’s obviously the upcoming Xbox Series X and Series S, but presumably would also include any Xbox One or even spare 360 sold, though again, the exact details are not made clear at this time. There are also a lot of questions that aren’t answered now, such as whether Game Pass revenue is counted. Those specific details may very well never be shared.
It’s an interesting move by both parties. GameStop no doubt sees this as a move to heal some of their financial wounds and Microsoft probably sees an opportunity to push their systems to those who still shop brick and mortar. Whether or not it will benefit either significantly remains to be seen, but it’s an inventive partnership all the same.
Today $GME confirmed with @DOMOCAPITAL that the agreement with $MSFT includes revenue sharing on all downstream revenue (i.e. digital downloads and digital content) from any device that GameStop brings into the @Xbox ecosystem. GameStop now meaningfully participates in digital.
— DOMO Capital Management, LLC (@DOMOCAPITAL) October 14, 2020