Rumors suggest the Xbox console era might be ending due to rising Game Pass costs. Wedbush Securities analyst Michael Pachter warns that the subscription model's high price could undermine hardware sales. Microsoft continues development of its next console, slated for 2027.
Rumors are circulating that the traditional Xbox console business may be approaching its conclusion, driven by Microsoft's recent increase in Xbox Game Pass pricing. The Game Pass Ultimate tier, which offers day-one access to new releases, now costs $30 per month, amounting to $360 annually. This compares to the roughly $140 that many gamers spend yearly on a few select titles.
Wedbush Securities analyst Michael Pachter, once optimistic about Game Pass's growth, now expresses concerns that the subscription could strain players' budgets and fail to boost sales of the upcoming Xbox hardware. "The problem with Game Pass was it was all or nothing," Pachter stated, advocating for a more flexible "a la carte" option to attract those who buy games individually. He argues that tying the console's appeal so heavily to the service risks eroding its standalone value, especially without strong exclusive titles.
Speculation points to the next Xbox, codenamed "Magnus," as a hybrid device combining PC and console features, potentially even supporting Steam. However, Pachter remains doubtful, emphasizing the need for compelling exclusives to draw buyers.
Microsoft shows no signs of halting the project. In early February, AMD CEO Lisa Su confirmed the console remains on track for a 2027 release. Asha Sharma, the new head of Microsoft Gaming, has affirmed that hardware development is a priority. Former Xbox president Sarah Bond described the system as "high-end," though rising costs for components like storage and memory could elevate its price further.
The combination of a premium console and expensive subscription tests gamers' willingness to invest in Microsoft's ecosystem.
