Microsoft and Xbox announced significant price increases for Game Pass that went into effect today.
A screenshot from Halo 2: Anniversary (2020), 343 Industries
In a post on Xbox’s website, the company shared that in the United States the price for Game Pass Ultimate increased from $16.99 to $19.99 per month. That’s a 17% price hike per month.
The company also revealed the yearly subscription for Game Pass Core increased from $59.99 to $74.99. That’s a 25% increase. These prices changes go into effect for new members effective July 10, 2024. For those with a recurring subscription, the price will change beginning on September 12, 2024.
A screenshot from Fable (TBA), Playground Games
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On top of the increase in prices, Xbox appears to be preparing to phase out Xbox Game Pass for Console. The company announced, “Starting on July 10, 2024, Xbox Game Pass for Console will not be available for new members.”
However, it also noted that currently subscribed members will still have access to the service and “will be able to continue to enjoy your membership.” This is contingent on members stay subscribed to the membership. Xbox noted, “If at any time you turn off your automatic payment renewal and your membership lapses, you will no longer have access to Game Pass for Console and will need to join one of the other plans we offer for Game Pass.”
A screenshot from Redfall (2023), Arkane Austin
Finally, the company announced a new Games Pass option that they are calling Xbox Games Pass Standard. This option is priced at $14.99. It grants players access to “hundreds of high-quality games on console,” allows players access to “online console multiplayer,” and gives them access to “member deals and discounts.”
You can see the three Game Pass options that Xbox has available below:
Xbox Game Pass Options for Xbox Console
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These price hikes come in the wake of multiple rounds of layoffs by Microsoft and Xbox over the past year. Gaming at Microsoft CEO Phil Spencer originally explained one round of layoffs in January in a memo that it was to align “on a strategy and an execution plan with a sustainable cost structure that will support the whole of our growing business. Together, we’ve set priorities, identified areas of overlap, and ensured that we’re all aligned on the best opportunities for growth.”
He continued, “As part of this process, we have made the painful decision to reduce the size of our gaming workforce by approximately 1,900 roles out of the 22,000 people on our team.”
A screenshot from Starfield (2023), Bethesda Game Studios
In an interview with Polygon in March, Spencer put much of the blame on what he saw as an industry that was no longer growing. He explained, “The thing that has me most concerned for the industry is the lack of growth. And when you have an industry that is projected to be smaller next year in terms of players and dollars, and you get a lot of publicly traded companies that are in the industry that have to show their investors growth — because why else does somebody own a share of someone’s stock if it’s not going to grow? — the side of the business that then gets scrutinized is the cost side.”
“Because if you’re not going to grow the revenue side, then the cost side becomes challenged,” he added.
A screenshot from Everwild (TBA), Rare
Next, he shared, “We’re a business. I’ve said over and over. I don’t get any luxury of not having to run a profitable growing business inside of Microsoft. And we are that today. But just across the industry — you mentioned it, and in sitting here at GDC, I reflect on friends of mine in the industry that have been displaced and lost their jobs and how just, I don’t want this industry to be a place where people can’t, with confidence, build a career.”
“So that’s why I keep pivoting back to: How does this industry get back to growth? But to your question, for us as Xbox or any of the teams that are out there, it is really an outcome of an industry that’s not growing. It can grow and it will grow again. But you see this time right now and the implications have human impact. And we should all reflect on that and think about it,” Spencer asserted.
A screenshot of Joanna Dark from Perfect Dark (2024), The Initiative
As for how he plans to solve what he views as a growth problem, he plans to eschew console exclusivity. He said, “I will say, every decision we make today and tomorrow is for the better of Xbox. I know sometimes things get weaponized, that there’s some evil in the background that’s making us do things — ‘Phil hates exclusives and that’s why we’re like PlayStation and Switch now.’ Every decision we make is to make Xbox stronger in the long run. It doesn’t mean everyone’s going to agree with every decision we make. But it is fundamental for how we make decisions.”
“This notion that Xbox can only be this one device that plugs into a television isn’t something we see in the Gen Z research. Because nothing else is like that for them,” he continued. “Some of them will have an iPhone, some will have an Android, but all the games and everything is the same. I can still get to TikTok on both of them, at least for now. All of their stuff is available wherever they want. So for Xbox, our brand pivot — as we attract and maintain relevance with a younger audience — is ‘Xbox is a place where I can find the great games I want to.”
A screenshot from Senua’s Saga: Hellblade 2 (2024), Ninja Theory
Given these significant price hikes, he also clearly intends to maximize the amount of dollars that Games Pass brings in from its current user base. It’s hard to imagine that he expects the various subscriptions to grow given his overall outlook on the industry as a whole.
What do you make of Xbox significantly raising their prices for Game Pass?
