The GameStop contract with Microsoft cuts every sale of digital games

While the video game retailer’s shares received a huge boost from the original announcement, which was heavily focused on GameStop and leveraged the software giant’s back-end solutions to better serve customer needs in the age of digital games, one sentence was of the two companies “Realize the customer acquisition and lifelong revenue value of every player brought into the Xbox ecosystem. ”

That apparently intrigued Domo Capital Management enough to dig further. According to the Ars Technica website, the private equity firm spoke directly to GameStop, confirming that the retailer will receive “a portion of the downstream revenue from every device we bring into the Xbox ecosystem.”

That means GameStop gets a cut from every digital game download, downloadable content, microtransaction, or paid subscription made through every digital game console sold.

A new opportunity to participate

This is a significant development, even if the actual percentage GameStop receives isn’t actually much as some analysts suggest.

The video game retailer now has an incentive to sell Microsoft’s all-digital consoles as well as those that still use physical media. It has also adjusted to receiving a source of income for digital and online gaming from which it was previously excluded.

While analysts don’t know that GameStop is getting so much money because Microsoft has no incentive to give away a lot of money – it would sell its consoles whether or not GameStop did so – it helps keep the retailer busy and a part of the company’s gaming community.

When the deal was announced, Microsoft said GameStop was an important part of its gaming ecosystem and that it was “pleased to expand our partnership”. That seems to mean both financially and through back office support.