Xbox Game Pass Ultimate Price Hike Sparks Talk of Ad-Supported Tier
Microsoft recently announced a notable price increase for Xbox Game Pass Ultimate, raising the monthly cost from $19.99 to $29.99. This significant jump has led industry analysts to speculate that Microsoft could be exploring new strategies to keep its popular subscription service viable and appealing to a broader audience, including the potential introduction of an ad-supported Game Pass tier.
Daniel Ahmad, an analyst at Niko Partners, suggests that Microsoft is banking on the loyalty of existing console Game Pass subscribers while simultaneously working to expand its library of Xbox Game Studios titles onto PC and third-party platforms. Ahmad also pointed out that an ad-supported subscription tier could be a way for Microsoft to draw in new players and lower the entry barrier for its service.
“The primary concern for Xbox at this time is managing the transition from a closed console based ecosystem to an open multi-device ecosystem,” Ahmad stated. “Console sales have dropped considerably, PC Game Pass uptake has been slow, and cloud is still seen as an extension of existing play, not a primary entry method.”
Microsoft's strategy, according to Ahmad, relies on its current console base remaining committed to Game Pass, even with increased prices or a premium tier. At the same time, the company aims to boost growth on PC, PS5, and even potential future platforms like the Switch 2, through day-one releases or later full-price ports.
An ad-supported version of Game Pass could become a key part of Microsoft's experimentation with the service across various devices, including cloud streaming and mobile platforms. However, it remains unclear how such a tier would function and whether players would embrace it. Past experiences, like Square Enix's CoreOnline service in 2012, showed that ad-supported gaming services might not always find a solid footing with consumers.
It's important to note that the recent price adjustment primarily affects the Ultimate tier. While the Core and Standard tiers have been renamed Essential and Premium respectively, their prices have not increased. The upgraded Ultimate subscription now includes additional benefits, such as the 'Fortnite Crew' subscription (available from November 18) and 'Ubisoft+ Classics,' alongside an expanded game library.
Ultimately, these changes and speculations highlight Microsoft's ongoing efforts to navigate a dynamic gaming landscape, balancing subscription value with business growth as it transitions to a more open, multi-platform ecosystem. For players, this could mean more options and features in the long run, but also a shifting cost structure to consider.
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