One of the most significant news of the week at Xbox was undoubtedly Xbox Game Pass Price Hike announced by Microsoft.
As we already told you in the related news, Game Pass for consoles will be removed as an option for new users, while the prices of Xbox Game Pass Ultimate, Xbox Game Pass Core, and PC Game Pass. Additionally, a new “Standard” tier has been introduced which includes only online multiplayer and approximately 25 games from the previous catalog.
Microsoft has been a bit ambiguous about Game Pass pricing changes. In court, while fighting the FTC in defense of the Activision-Blizzard acquisition, lawyers said last June that there would be no increase after the closing. However, the CEO of the Xbox division, Phil Spenceradmitted that an increase in the price of the service would be inevitable in the future.
Rhys Elliottgame analyst MIDiA Researchshared his opinion on the topic to the portal Wccftech:
“Xbox has largely maxed out its console subscriber base, so it’s looking to maximize average revenue per paid user (ARPPU) and onboard new subscribers with its higher-priced predecessors. Call of Duty is going to bring in more subscribers, so the timing makes sense. Expect further price increases in the future. Rising PC prices suggest growth is starting to saturate there as well. Weaning PC gamers off Steam is nearly impossible.”.
“Game Pass on consoles doesn’t guarantee day one online access to games like Call of Duty, so the OG tier is basically a confusing legacy tier that doesn’t fit the new direction”has continued Elliott.
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“The Standard plan represents Xbox’s half-step from Core to Ultimate. Removing games on day one also re-qualifies some Ultimate players to purchase new premium games again, again increasing ARPPU. Cannibalized premium revenue has been a huge opportunity cost for Xbox.”.
“Ultimately, these changes reflect Xbox’s recent strategy: sell fans to Ultimate and grow ARPPU ahead of the company’s huge mobile/cloud push. PC and console will remain important, but those markets are reaching saturation, and Xbox needs growth.”he concluded Elliott.
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