Microsoft’s Xbox Bet Goes All-In on Profits, Alienating Gamers A few years ago, Microsoft offered some of the best deals in gaming. The Xbox Series S was a well-priced entry at 300 dollars, and a 15 dollar monthly subscription to Xbox Game Pass Ultimate offered a vast catalog of games. But the landscape has dramatically shifted in 2025, and not for the better for gamers on a budget. The nearly five-year-old Xbox hardware lineup received not one but two price bumps this year. The Series S with 512GB of storage now costs a whopping 400 dollars, while the Series X starts at 600 dollars for a digital-only model or 650 dollars with a disc drive. This represents increases of 150 and 100 dollars over their retail prices from just a few months ago. Adding significant injury to that insult, Microsoft also jacked up the price of Game Pass Ultimate by 50 percent. It will soon cost 30 dollars a month, up from 20 dollars. This service was only 17 dollars as recently as July of last year, making this a positively wild move in a short period. Microsoft is not alone in raising prices. Nintendo is charging more for the original Switch, and the new Switch 2 is priced at 450 dollars. Sony also increased PS5 pricing this year, though to a less dramatic extent. Economic uncertainty plays a role, but Microsoft’s approach feels particularly egregious. The new strategy appears to be a bet that increased revenue from die-hard subscribers will offset losses from those who leave. Subscriber inertia is real, and devoted users may not immediately cancel. On paper, 30 dollars for hundreds of games, including high-profile day-one releases that cost 70 dollars or more individually, can seem reasonable. It is analogous to the value proposition of music streaming. However, Microsoft had a chance to set the market rate for subscription gaming and arguably aimed too low initially. Now, it is making up for it with aggressive hikes that sting longtime supporters. A year of Game Pass now costs more than double the annual rate for a PlayStation Plus Platinum subscription. While Sony does not offer its biggest first-party games on day one, its service provides immense value, especially for players who do not need to play the latest title immediately. For many, this price hike will be the final straw. The target market for the Series S and Game Pass was people curious about the Xbox ecosystem without a deep commitment. The year-one cost for that combo was once 480 dollars. Now, it is almost double at 860 dollars. That is a brutal increase, especially when you can get more for your money in the PlayStation ecosystem or on PC with Steam sales. Furthermore, former Xbox exclusives, like Forza Horizon 5, are increasingly coming to other platforms, removing another key reason to buy into Xbox. Microsoft’s broader strategy is that anything can be an Xbox through game streaming, reducing the need for expensive hardware. But this requires a robust internet connection and may not satisfy players who want the best performance. While streaming is included, the core audience for a premium 30-dollar subscription will likely want a dedicated console. Microsoft seems to have decided that shifting consumer costs to its subscription service is the future, moving away from hardware as a loss leader. But for people who already bought into the Xbox ecosystem, this feels like being taken advantage of. The big bet is that fewer customers paying more will be profitable in the long run. It is a risky strategy, and one that this gamer, and likely many others, will not be sticking around to see play out.
