Xbox Game Pass Price Hike Reportedly Pushed Subscribers Away, but Recent Cuts Are Helping
Microsoft’s Xbox Game Pass strategy appears to be shifting after price increases reportedly led to a noticeable rise in cancellations. A leaked internal memo has offered rare insight into how players reacted to the higher subscription costs, suggesting that the service became too expensive for a portion of its audience.
According to the memo, Xbox CEO Asha Sharma acknowledged that the pricing changes had a negative impact on growth. She reportedly told employees that “growth slowed down” and that subscriber losses accelerated after last year’s pricing and tier adjustments. The comments suggest that Xbox Game Pass was already facing pressure before the latest wave of price changes made the issue worse.
The most significant change came when Xbox Game Pass Ultimate rose sharply in price. The Ultimate plan had previously increased from $16.99 to $19.99 per month, but a later adjustment pushed the cost even higher to $29.99 per month. At the same time, some lower-priced tiers lost access to day-one game releases, reducing the value for players who subscribed mainly for new Xbox first-party titles.
That combination appears to have frustrated many gamers. For years, Xbox Game Pass was promoted as one of the best deals in gaming, offering a large library of titles, day-one releases, cloud gaming, and access across console and PC. But as prices climbed and benefits changed, some subscribers began questioning whether the service still delivered enough value.
After Sharma became Xbox CEO in February, Microsoft moved to correct course. The company lowered the Ultimate tier to $22.99 per month, while PC Game Pass users also saw some relief. The internal memo reportedly says these price reductions have already helped improve new subscriber sign-ups and retention, meaning fewer people are canceling and more players are willing to join again.
However, the lower price comes with some important limitations. One major change is that future Call of Duty games are no longer included in the same way for some subscribers. Since Microsoft’s acquisition of Activision Blizzard made Call of Duty one of the company’s most valuable gaming franchises, keeping those releases outside certain Game Pass benefits could help protect direct game sales and improve revenue.
Microsoft is also experimenting with other ways to expand the Game Pass audience. A limited Starter Edition has been bundled with Discord Nitro, giving users access to a smaller selection of games and cloud gaming features. There have also been reports of potential streaming-focused offers, including possible entertainment bundles and a free cloud gaming option supported by limitations or alternative monetization.
The key question now is whether cheaper Xbox Game Pass pricing can bring back enough subscribers while still supporting Microsoft’s long-term gaming business. More users may return at $22.99 than at $29.99, but lower monthly fees also mean Microsoft needs stronger subscriber growth to hit revenue targets.
There is also an ongoing debate about whether Game Pass affects traditional game sales. While the service can help more players discover new titles, some publishers and analysts worry that subscription access may reduce full-price purchases. Microsoft’s decision to treat future Call of Duty releases differently may be a sign that the company is trying to balance subscriber value with the need to protect blockbuster game revenue.
For players, the recent price cut is a welcome change after a period of frustration. For Microsoft, it may be a necessary reset. Xbox Game Pass remains one of the most important subscription services in gaming, but the leaked memo suggests there is a limit to how much players are willing to pay, especially when key benefits are reduced.
The message is clear: value still matters. If Microsoft wants Xbox Game Pass to keep growing, it will need to offer the right mix of price, day-one releases, cloud gaming, and premium titles without making subscribers feel like they are paying more for less.
