Xbox’s cloud gaming service is experiencing significant growth, with Phil Spencer, CEO of Gaming at Microsoft, announcing a 45% increase in Game Pass cloud hours compared to the same period last year. This surge in engagement is being described as “encouraging” by Spencer, who highlighted the growing accessibility of gaming.
The momentum extends across various platforms, with console cloud streaming hours also up by 45%. Additionally, streaming on “other devices” has seen a 24% increase. Spencer emphasized Microsoft’s commitment to providing players with more choice, allowing them to play what they want, where they want.
Despite the positive figures, it’s challenging to ascertain the full impact without specific baseline data from Microsoft, which remains private about its Game Pass subscriber numbers and console sales. This news comes shortly after a significant price hike for Xbox Game Pass Ultimate in the U.S., which increased by 50% from $19.99 to $29.99, leading to some user dissatisfaction.
Microsoft did report that Game Pass achieved a new annual revenue record, nearing $5 billion, bolstered by recent major game releases. The company continues to state that creator participation and player engagement within Game Pass are at an all-time high, though concrete numbers are not publicly shared.
Interestingly, Spencer’s remarks coincide with persistent rumors about Microsoft testing a free, ad-supported version of Xbox Cloud Gaming. This potential tier, reportedly being tested internally, would not require a Game Pass subscription and could expand access to cloud gaming significantly.
The past year has presented various challenges for Xbox, including layoffs within the gaming division and criticism from industry figures regarding the sustainability of the Game Pass model. Furthermore, the cost of being an Xbox player has been a point of discussion, with initial $80 game price announcements being revised to $70, and console prices seeing an increase in the U.S. due to macroeconomic factors. The premium pricing of devices like the ROG Xbox Ally X also drew attention.
Our Take: While the 45% increase in cloud hours is a notable figure, it’s crucial to view it within the broader context of Microsoft’s strategy and the gaming industry’s evolving landscape. The push for cloud gaming aligns with a broader trend of making games more accessible, but the company’s continued reticence to share specific subscriber and engagement metrics makes it difficult to fully gauge the health and impact of Game Pass. The potential introduction of a free, ad-supported tier could be a significant move to broaden the service’s reach, but it also raises questions about its long-term viability and player experience. The reported revenue increase is a strong indicator of financial success, but the ongoing discussions around pricing and the sustainability of the subscription model suggest that Xbox is navigating a complex path forward.
This story was based on reporting from IGN. Read the full report here.
