A ton of Hi-Fi Rushe's "3 million players" were on Gamepass, and didn't play much of the game. The completion rate, which we can judge from achievement % (14% of players beat the last boss), is half that of even an average game.
That's, in a way, good for players. They could, theoretically, deliver only money to developers of games they actually end up playing, instead of buying just because the PR campaign was good.
The problem with this price signalling is it goes through the profit seeking and largerly arbitrary intermediary of Microsoft. Gamepass contracts appear to be written out based solely on expectations of executive rather than any underlying reality whatsoever (they expected Baldur's Gate 3 to be a cheap third tier title they didn't have to pay much for, as far as I understand it if Larian had gone with Gamepass they'd have lost tens to hundreds of millions on the outside), for third parties Microsoft's motivation is to take as much profit as possible, and by making things opaque to both players and developers they gain an even bigger leverage than Steam does.
Thus Gamepass ends up being bad for developers beyond those perhaps seeking to "longtail" or rather get as much money out of already established and spent games as they can. There developers already have good information on how well the game did, how much it's worth, and have already leveraged what they can out of playerbases that aren't on Gamepass. So Gamepass ends up being like Sony porting over first party titles to PC, though probably worse than than the most successful ports, still on average just some extra $ rung out at the end of a game's relevant life.