This week, Microsoft revealed a significant price increase for its Xbox Game Pass Ultimate subscription service, raising the cost by 50 percent to $30 per month. The announcement comes amidst troubling news regarding the financial implications of the service's offerings. A former employee disclosed to Bloomberg that Xbox incurred a staggering $300 million loss in sales of the popular Call of Duty series last year. This decline in revenue is attributed to the game's availability on launch day for subscribers of both Xbox Game Pass Ultimate and PC Game Pass, based on internal estimates.
Despite Microsoft's initial ambitions for Xbox Game Pass to emulate the success of Netflix in the gaming industry, the anticipated explosive growth has not materialized. Joost Van Dreunen, founder of the video-game analytics firm Aldora, highlighted that Microsoft's infrastructure costs are out of sync with their current pricing model. The Game Pass service, which debuted at $10 per month in 2017, began featuring new games on launch day just a year later. However, as the service evolved, the pricing structure changed significantly, with day-one access now exclusive to the Ultimate and PC tiers.
Former Federal Trade Commission Chair Lina Kahn attempted to impede Microsoft's acquisition of Activision Blizzard, a move that ultimately did not succeed. Following the acquisition, Kahn publicly expressed concerns about the consequences of such market consolidation. She remarked on social media, "Microsoft’s acquisition of Activision has been followed by significant price hikes and layoffs, harming both gamers and developers." She underscored a troubling trend where increasing market consolidation often correlates with rising prices, leaving customers vulnerable to the actions of dominant firms.
As of February 2024, the latest subscriber count for Xbox Game Pass stands at 34 million. In July of the previous year, Microsoft announced that Xbox Game Pass generated nearly $5 billion during the fiscal year ending June 30, 2025. The service underwent notable changes on October 1, rebranding Game Pass Core to Game Pass Essential and Game Pass Standard to Game Pass Premium. These tiers now provide enhanced benefits, including access to PC games, cloud gaming, and in-game perks from partners like Riot Games.
One of the standout features that drives subscriptions to Xbox Game Pass is the availability of day-one games. However, this premium access now comes at a higher price point, costing $30 per month for the Ultimate tier and $16.50 for the PC Game Pass. As Xbox navigates the challenges of maintaining its subscriber base and ensuring profitability, the implications for gamers and the industry remain a topic of active discussion.
William D'Angelo, the author of this report, is a long-time gamer and a dedicated member of the VGChartz team since 2007. He has evolved from a junior analyst to the lead analyst, contributing to hardware estimates and expanding his influence through content creation on platforms like YouTube and Twitch. Follow him on Bluesky for more insights and updates.
