A gamer plays soccer title Pro Evolution Soccer 2019 on an Xbox console.
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Microsoft is implementing a significant overhaul and price adjustment to its Xbox Game Pass subscription service. The company announced Wednesday that the Xbox Game Pass Ultimate tier will see a 50% price increase, jumping to $29.99 per month effective immediately. This move reflects Microsoft’s ongoing strategy to enhance the value proposition of its gaming subscription amid competitive pressures and evolving market dynamics.
The price hike is accompanied by structural changes across the Game Pass ecosystem. While the Essential and Premium plans will maintain their current pricing at $9.99 and $14.99 per month, respectively, Microsoft is streamlining its offerings. The Game Pass Core tier will be integrated into the Essential tier, and Standard subscribers will be upgraded to the Premium tier.
“As we continue to evolve Xbox Game Pass, we’re focused on delivering more value, more benefits, and more great games across every plan,” Microsoft stated in a press release. “Whether you play on console, PC, cloud – or all three – there’s a Game Pass option designed to fit your playstyle.”
The annual cost for the new Ultimate tier will be $359.88, compared to $179.88 for the Premium tier and $119.88 for the Essential tier. This pricing structure invites scrutiny when juxtaposed against Sony’s PlayStation Plus Premium, which is priced at $159.99 annually, with the Extra tier at $134.99 and the Essential tier at $79.99. The competitive landscape is fiercely contested, and pricing plays a pivotal role in subscriber acquisition and retention.
Microsoft aims to justify the increased price through enhanced content and features. Game Pass Ultimate subscribers now gain access to over 400 games and more than 75 day-one releases annually, with over 45 new titles added this Wednesday.
The integration of Ubisoft+ Classics into the Ultimate tier enriches the offering with titles like “Prince of Persia: The Lost Crown,” and “Assassin’s Creed IV: Black Flag.” Moreover, subscribers will experience improved streaming quality up to 1440p and a new rewards program.
Premium subscribers will benefit from an expanded library of over 200 games, while the Essential tier will receive over 50 titles. Importantly, both tiers will now include unlimited cloud access, a feature previously exclusive to the Ultimate plan. This democratization of cloud access could significantly broaden the appeal of the lower-priced tiers.
Microsoft’s gaming division has seen substantial growth, partly fueled by its acquisition of Activision Blizzard in 2023 for $75.4 billion. This acquisition, the largest in Microsoft’s history, bolsters its content portfolio and provides a critical competitive edge. In 2024, Microsoft reported a record 34 million Game Pass subscribers and nearly $5 billion in revenue from the service over the last fiscal year. Gaming accounted for 8% of Microsoft’s total revenue in 2025.
Despite the success of Game Pass, Microsoft’s Xbox Series X and Series S consoles are facing stiff competition from Sony’s PlayStation 5 and the anticipated Nintendo Switch 2. Company data reveals that Xbox hardware revenue decreased by 25% in FY 2025, indicating potential vulnerabilities in console sales.
Adding to the complexity, select Xbox consoles will experience price increases in the U.S. starting in October. The Series X will retail for $699, and the Series S for $399. These successive price hikes reflect the pressures of tariffs, macroeconomic conditions, and the need to balance profitability with market share. Microsoft’s strategic adjustments to Game Pass and console pricing are key to navigating the competitive console war and sustaining growth in its gaming ecosystem.
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