
Last week, Microsoft announced some big changes for Xbox Game Pass, including price increases across all tiers of the service. It all continues to feel like a messy mix-up, especially considering the lack of proper communication from the team on all of the changes involved. However, analysts who've looked at the move say the price hikes were 'inevitable' - and they think that the service isn't done changing and evolving just yet.
Over at IGN, the team has put together an extensive look at these Game Pass changes - with input from various gaming analysts on why this happened and what comes next. George Jijiashvili of analyst group Omdia thinks that Microsoft's price bumps were "inevitable" in order to increase "average revenue per user" - especially with Call of Duty coming to Xbox Game Pass soon.
Elsewhere, certain folks think that Microsoft removing 'some' day one releases from lower Game Pass tiers is an attempt to push players towards Xbox Game Pass Ultimate; the team's highest tier. Ampere Analysis reckons almost 75% of current subscribers have Ultimate - meaning over a quarter of Game Pass users are there and waiting to be convinced by Microsoft's Game Pass Ultimate tier.
Finally, an ad-supported tier has also come up in conversation here. Joost Van Dreunen of Parsec Gaming expects a pretty big shift towards a cheaper Game Pass tier with adverts in the near future. Here's what he had to say on that potential strategy:
"There will be three phases, roughly. Initially, I expect ads to show up as banner ads inside of the Xbox and Game Pass menus. Mostly as a test case, it will start slow.
However, once Microsoft develops this capability over the next few years, I anticipate interstitial ads (during loading screens, for instance) as a second phase.
Finally, and assuming that this works out well for its ecosystem, Microsoft is likely to make an acquisition in the ad tech space to acquire the capability to both facilitate programmatic ads and a centralized inventory using existing ad industry metrics and tool sets. This last component is obviously the furthest out."
As is always the case with analysts and such, these are informed opinions based on experience and importantly, data - but that doesn't mean they're all going to happen. Anyway, the full IGN piece is well worth a read, as they've gathered up plenty of information for this broad look at Xbox Game Pass. Oh, and as you ponder these potential changes in the future, you can check out what has been confirmed by Microsoft down below.
Thoughts on all of this? Tell us what you think is coming next down in the comments section.
[source ign.com]
Comments 26
I would go for the ad version tbh as long as it doesn't interfere with cutscenes.
The current one is the ad version as there are loads on my dashboard.
Jokes aside…
There will be an AD version. Haven’t they done previous marketing questions? Which will start with a few ads and Gradually build into more.
@Medic_alert while I personally wouldn’t want it I think choice is good and an ad-supported tier makes sense to get more people on board, especially on things like Fire TV.
This could in fact help us on higher tiers, as more people on the service means more money in the coffers to stay profitable. The alternative is to keep raising prices, reduce value or both.
The trouble is they already have too many tiers, it’s confusing for the average consumer.
This pretty much how subscription services work. They launch with low prices to get people on board then ramp prices up in small and slow increments over time so there is no massive shock in increases.
Happens time and time again and this is just MS’s turn…
Good job analyst, you figured out what everyone else figured out 6 years ago
no no, ads will be added to all tiers. its the microsoft way.
And what about the rumor of MW3 dropping to sort of justify the price hike? They couldn’t even bother to do that?
We already get a poop ton of ads!
We don't need more!
There will likely be a few more tiers added. Ad version, family plan, cloud only, etc.
@IOI It really is mind boggling. You would think that with this tiered game pass news spreading they would drop something we actually want. An Activision game could be nice. The Activision bulk drop isn't happening anymore, and lately it's just been I indie games.
I actually like indie games but I get enough of them on the MUCH cheaper Google Play Pass.
Honestly I think they realized that GP isn't as profitable as they thought, so they're trying to kill it.
I'm looking forward to selling my Xbox once the current two year subscription comes up for renewal, ads on my console almost make me want to give up game playing all together. But thanks to my steam deck, that's not really a problem 😄
I fully expect an ad tier, and wouldnt have an issue with it as an offering to be honest. If it was cheap enough, id sub to it for my 8 year old daughter in lieu of a family sub. (Which I wish was a thing) Keeping an ad free membership for myself of course.
Ive said this many times, but as long as it remains a value, I dont see an issue with a price increase. Currently, assuming you play online at all, the price per year with the updated pricing is $170. ($20 per month x 12 months - ($70)xb live basic cost which is sunk)
@$70 per new release AAA title, thats ~2.5 titles per year. Or with budget titles at say $30, ~6 titles. Assume a mix of products and you get your value out of 1 full AAA game at $70 and 4 indie games over the course of a year. I easily get that value out of gamepass. Especially when you consider that game rentals dont really exist anymore, so you have to rely on limited demo releases(super rare) or other people's or critics feedback(which is less reliable than ever before)
Everyone will have their own threshold for what is valuable, but as someone born in the late 70s who has seen the industry really grow, and bought lots of games in the early 90s at a much higher rate of cost than todays games, I see great value still in the gamepass option. (PS Premium has its value too, but not as much to me)
Uh yea. Duh. The entire game pass model is completely unsustainable at the price being offered. It will be $30-$40 a month lot faster than people realize.
This is why Xbox Live was far superior. Wish it never left, wish it was still available. Game pass is a money sink compared to live.
@Dodoo Yep. And exactly why I not support them and hope more people become vocal about those kinds of practices and vote with their wallets.
@Fishticon But.... But.... But.... But indie games are the greatest thing since sliced bread. It's the very reason I spent $400 for high tech Series X, so I could then pay another $20 every month to play game boy level quality games.
Game pass is the GREATEST deal in gaming! EVER! Well, they keep telling us that.
It does go to show even gamers like you that enjoy indie games opt out of game pass due to its actual value and over inflated price.
I'm really hoping they see what a failure game pass is and bring Xbox Live back. Now that was a true value in console gaming. Bought 12 month card for like $40 on sale and used Gamefly to rent all the games wanted to play.
Sadly Microsoft even ruining that option now by ditching ability to stack more than year worth of subscription. I really supported and tried to roll with the idiotic decisions and moves they've made last few years. But even for, it's getting really hard to overlook.
Game pass is $20+ tax a month, sure.
But add that up for a year and that is $240+tax
That's a lot of money for something you don't own!
The appeal of an ad-tier demonstrates the declining buying power of the average consumer — something that Microsoft should be aware of when setting expectations and goals.
@101Force all of microsoft live in a different world than common folk. its like the hunger games.
Considering every other sub is getting frequent price increases, ad-supported teirs (or adding them with an optional extra cost to remove them), and doing crackdowns (password sharing using trials), I'm not suprised Gamepass is getting the same treatment.
I'm not happy about it, I'm just not suprised.
Not happy about the screwing with "standard" though.
It makes sense, and definitely introduces a shakeup in the game sales model that's, honestly, hurting badly. On one hand advertising is probably better than "pay to win" predatory models. On the other hand the whole concept is going back to the future, where gaming turns into 1990's broadcast radio and TV, and I expect even paying customers (or high paying customers) won't escape the ads without "upgrading" to a to-exist extreme priced version, as the trend on streaming TV has been that providers don't actually want you to pay, because the advertising is worth more than all but the highest tier subs.
Remember when US cable television's big claim to fame was "ad free" vs broadcast? Then somewhere along the line you started paying $150 a month and getting more ads than broadcast? Yeah....
I can see it introducing gaming to a new market, which is exactly what they've been trying to do, and arguably what gaming needs more than anything. However, I can also see the entire ecosystem becoming miserable as a result for the existing market as "gaming as you know it' transforms into an ad sponsored "content" platform.
The other problem with this is that the subs work when what you're paying for is a holistic package. Jacking prices because they decided to include one particular huge game that many subscribers might have less than zero interest in just crushes the value of the package.
@Dodoo The problem is MS isn't doing it in small increments. Spotify raised my price after 2 or 3 years....by one dollar. Tidal reduced my price by $9. YT Red/Premium/Whatever raised it by $2 after several years.
Meanwhile MS jacked the price 25% in a single year. Forgetting JND is the problem here. 25% should have taken 5 years. Not 1.
The problem we have now is by all indications they're in a phase where they don't know how to make the numbers get where they want and it's clear they're going to keep messing with the pricing and tiers and services and value for an indefinite period of time, so have no long term understanding of what the service will be. Making your sub this "lets see what it is next month" plan isn't a great strategy for a sub.
Honestly, I was looking over Quest 3 software the other day and noticed they have a subscription service themselves.....$8/mo or $60 a year. If into VR, that kinda seems like a better buy than GP right now.
@101Force I think your comment needs to be tattooed on the forehead of every single individual that may possibly pass anywhere near Wall Street.
The entire business world seems to not understand their metrics and seems entirely unaware of this phenomenon. Somehow they haven't figure out that their costs went up 35%, their prices went up 40%, but they did not grant 40% pay increases to their employees across the board.....and that probably explains their numbers.
Bottom line is unless everyone in the us is making 40% more than than they were for the same job in 2019, everyone has radically less buying power. And go figure, virtually NO ONE has gained anywhere close to that much, nor will they.
Somehow the financial geniuses the lord over us have yet to solve that simple math problem. I do wonder what their vaunted graduate degrees from ivy league schools provided by the connections their daddies had taught them.
It was obvious they were gonna put the prices up. Its only like the price of a coffee. It's still the best value gaming subscription. I'm honestly not bothered.
I don't t feel the price hikes wouldn't matter so much if online was free as it is on PC. But they know too many people would fall back on that.
But why deal with all that when I can just play all of Microsoft's games on PC, with free online. AND prevent them from getting royalties on thrid party software sales(as they get when I buy a game on Xbox) because I buy on Steam.
Xbox Gamepass IS an ad tier. Not having Gamepass, the whole online experience is literally an ad tier. I let my Gamepass lapse last year for two weeks and tried out core. Man! So many ads for Gamepass, it was obnoxious and there's no way to turn it off. Already hate all the ads crowding the home page. I just wanna game!
@Blofse Man thatSteam Deck is bonkers good. I grabbed it a month after release it and still runs petefect.
I even added 20+ games to my backlog!
@Blofse I already did that, sold my Series X when they changed the dashboard from a lovely fully customisable experience, to endless forced ads I cannot turn off and my games library buried a I get them somewhere. And now they are bringing Ads to Windows, outside works PC I ain’t touching MS. I have my Game Pass Ultimate at rapid up till 2026 so will stream any games I want to play, but I won’t extend it beyond that. Had a Steam Deck twice but couldn’t get in with it? Think the screen was too small for me, will wait to see what the next one is like, but I have a PS5 now and a new high end Mac that runs Diablo 4 great, although I need to use emulation software.
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