Arkane Founder Calls BS on Microsoft’s Recent Focus on AI, Blames Game Pass

With recent news that Microsoft is looking to lay-off around 9,000 staff in a bid to focus attention (and funds) on AI tools and infrastructure, several video game projects and studios have had to close down. However, the founder of Arkane (Dishonored), Raphael Colantonio, took to X on July 6 and 7 to dispute the AI angle.
Colantonio implied that, rather than Microsoft making cuts so it could spend money on AI, it was trying to cover financial losses it’s suffering due to Xbox’s Game Pass. It’s worth noting that Colantonio is also the President and Creative Director of WolfEye Studios (Weird West), and has had multiple games from his studios appear on Game Pass.
“I think Gamepass is an unsustainable model that has been increasingly damaging the industry for a decade, subsidized by MS’s (Microsoft’s) ‘infinite money’, but at some point reality has to hit,” he said. “I don’t think GP can co-exist with other models, they’ll either kill everyone else, or give up.”
Jump to:
Aiming For Monopoly
Microsoft launched Xbox Game Pass in June 2017. Before this subscription service, there was Xbox Live (launched in 2002), with Xbox Live Gold being the high-tier subscription that also offered access to two games a month. This was phased out and replaced with Xbox Game Pass Core in September 2023.
Sony initially had PlayStation Network (launched in 2001), which allowed gamers to access online gaming and content, without a subscription. This changed in 2010, when it changed over to PlayStation Plus.

Neither Sony nor Microsoft are forthcoming about subscriber numbers, but according to Statista, as of June 2025: “PlayStation Plus was the most popular gaming subscription service worldwide, with over 47.4 million subscribers worldwide. Second-ranked Nintendo Switch Online and Xbox Game Pass had 34 million global subscribers, respectively.”
Colantonio’s comments regarding Microsoft actually needing money for Xbox Game Pass aren’t entirely unfounded, as the company set a plan into motion in 2022 to acquire Activision Blizzard so as to add its games to the PS Plus catalogue. This acquisition was finalized in October 2023 and cost Microsoft $68.7 billion.
To further put Microsoft’s hold on the video game industry into focus, it currently also owns id Software, MachineGames, Arkane Studios, Tango Gameworks, plus publisher Bethesda Softworks with its Bethesda Game Studios, and ZeniMax Online Studios. The latter studio was one recently closed as part of Microsoft’s newest round of lay-offs.
A Subscription Time Bomb
A fair point raised by gamers who have been responding to Colantonio’s remarks is that Xbox Game Pass has a ton of content available for the price, so really, who cares if Microsoft is hiding Game Pass details behind its AI-related news?
Colantonio was quick to respond: “I understand, you can look at it just from your standpoint, but when a deal is too good, there is a reason that might reveal itself later and will hurt everyone including you. At the moment you have access to a fair amount of good games for a fraction of the actual cost.”
“What *might* happen once MS has won: the games will start to suck and your sub will go up. Why? Because the current amazing deal you have is subsided by MS bleeding money into it with the hope they’ll kill the competition, but once they manage to do it, things will get real.”
More Studios, More Games
Colantonio is looking at Game Pass as both a developer who’s used it, and as a consumer, but his warning may not amount to much when other studios and publishers have recently spoken out in favor of the service.
Matt Handrahan, the Senior Portfolio Director for Kdepler, Clair Obscura’s publisher, said in May this year: “Our game was placed alongside Gears of War, Fable and products that are very traditionally known as AAA products. It let people understand what it was in a way that I think we would’ve struggled to do if we weren’t allied with Xbox in that way.”

“We couldn’t have done it through a Steam demo alone, for example,” he added. “It helped us to kind of claim this AA territory in a much more confident way. Because it’s a vague space that exists somewhere between small games and extremely big games, and there’s a lot of ground that that covers.”
John “Bucky” Buckley, Communications Director and Publishing Manager for Pocketpair, Palworld’s publisher, chimed in soon after with: “Expedition 33 is the latest game to get unwillingly dragged through gaming Twitter as people debate the viability of Game Pass. I feel like I’ve just a little more knowledge on the topic than most so I’ll just say yes, yes it is very worth having your game on Game Pass.”