Xbox Game Pass once seemed ready to reshape the gaming business, but repeated price increases have made it less appealing. Microsoft has also faced added pressure after including day-one Call of Duty releases, and recent signals suggest the company could adjust its strategy in the near future.
An internal memo cited by The Verge indicates Xbox CEO Asha Sharma has acknowledged rising costs associated with Game Pass. Microsoft is reportedly evaluating lower-priced subscription tiers, with timing still undecided.
Sharma stressed that Game Pass is still a key part of Xbox’s overall offering, but said it must provide better value. The company plans to begin testing a more flexible model and will continue internal discussions with staff next week.
At the same time, sources cited by Windows Central say Microsoft is considering pulling Call of Duty from Game Pass. The series was added in 2024, a decision that reportedly led to around $300 million in lost sales for Microsoft and Activision that year.
Efforts to recover those costs may have contributed to last year’s 50% price increase for Xbox Game Pass Ultimate and 40% rise for PC Game Pass. Microsoft added more content to improve value, but the higher prices may have resulted in record cancellations.
Sharma’s memo aligns with recent comments from Netflix co-CEO Greg Peters, who said after speaking with her that she is likely to prioritize expanding Game Pass. Other reports also suggest that introducing cheaper tiers could be part of that strategy.
Game Pass pricing begins at $10 per month, with the base plan including roughly 50 games. Higher tiers offer a much larger selection, with costs ranging between $15 and $30 per month.
Earlier reports provide some insight into what a lower-cost model could involve. Discussions around an ad-supported tier priced below $10 per month have been ongoing since 2022, and Microsoft is also believed to be testing a free, ad-backed option for Xbox Cloud Gaming. Usage would likely be limited to a few hours per month, potentially as little as one hour per session, though these details remain subject to change.
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