The games industry is undergoing some radical changes, and the challenges it is facing are caused more by the dominance of Fortnite and other popular live service and forever games than subscription services like Xbox Games Pass, according to a well-known analyst.
Commenting on recent video game sales data, Circana (NPD) Executive Director and Video Games Industry Analyst Mat Piscatella mentioned how video game subscription spending in the United States reached an all-time high in May 2025 with $0.6 billion spent and achieving the third consecutive month of growth. The analyst speculates that the spending increase in subscription services could be related to inflation and general economic uncertainty, making users look for value, which a service like Xbox Game Pass definitely provides.
Replying to a user mentioning the narrative that subscription services are killing the video games industry, Mat Piscatella highlighted how top live service games like Fortnite are more of a threat to the industry than services like Xbox Game Pass. The top 10 live service games are sucking nearly half of all gaming hours from the PlayStation and Xbox ecosystems before any other game can even get a taste of their popularity, so much so that, in every presentation given, the analyst points out that the biggest competitor to any new game or service is Fortnite. Compared to what the Epic Games’ title, Minecraft and Roblox are doing, nothing else really matters.
This isn’t the first time this week that we have heard how competing with games like Fortnite will become increasingly difficult. A few days ago, Square Enix’s former Director of Business provided a rather in-depth analysis of the gaming industry’s current state and how its transition to a social network of games phase is likely to shape its future.
