Xbox is set to impose stringent monthly limits on game streaming for its Game Pass subscribers starting in November. Subscribers to the £16.99 Ultimate monthly plan will only be able to stream games for up to 15 hours a month unless they purchase additional playtime. This change is attributed to the rising costs associated with cloud gaming, as Xbox aims to uphold the service’s reliability and performance.
Tiered Streaming Limits
Various subscription tiers of Game Pass will have distinct time constraints. Premium users will get 10 hours of streaming, while those on the Essential tier will receive five hours per month. For users exceeding these limits, extra playtime can be bought via the Xbox store, although the pricing for these additional hours has yet to be disclosed.
Despite having 30 million subscribers, Xbox reports that just 4% of Game Pass users engage with the cloud gaming service, impacting approximately 1.2 million users with the new limitations. Notably, cloud gaming enables users to stream and play games from remote servers using multiple devices without the need for pre-downloading.
Financial Pressures and Restructuring
As detailed by Asha Sharma, Xbox’s chief executive, the company is navigating through a period of “Rampocalypse,” where the soaring price of random access memory (RAM) is influenced by expanding data centres’ demands. Teaming this with reduced Xbox revenue by $1.7 billion, Microsoft’s latest financial filing noted a fall to approximately $21.8 billion (£16.1 billion) for the financial year.
This economic strain has led to significant restructuring within Xbox, involving 3,200 job cuts with plans for studios like Compulsion Games and Double Fine Productions to regain independence. Sharma emphasised, “Within Xbox, we haven’t been healthy,” highlighting the need for a strategic “reset” to ensure long-term survival and fulfil the company’s mission.
Industry Outlook on Cloud Gaming
Cloud gaming’s promise as an affordable alternative to expensive gaming consoles is still under debate. Despite substantial backing from major tech companies, the service remains hindered by its demand for robust internet connectivity and now, additional streaming costs. Google’s attempt with Stadia, launched in November 2019, ended in January 2023 due to unsatisfactory user engagement.
As the industry responds to escalating technology costs, some experts suggest online game streaming could gain traction as a viable substitute for traditional gaming hardware. Yet, the tangible challenges remain considerable barriers to cloud gaming’s mainstream acceptance.
Reporting based on coverage first published by bbc.co.uk.