Phil Spencer says Xbox can’t avoid raising prices “forever”

While Microsoft has avoided following Sony’s example of raising the price of their consoles so far, Xbox head Phil Spencer has admitted that it may “have to raise the price on certain things.”

• READ MORE: Best Xbox Series X|S games to play in 2022
  

Spencer was speaking at the Wall Street Journal‘s Tech Live (thanks, The Verge), where he dropped the first hints that Microsoft may be looking at raising the prices of its consoles and/or subscription services.

“We’ve held price on our console, we’ve held price on games and our subscription. I don’t think we’ll be able to do that forever,” said Spencer. “I do think at some point we’ll have to raise some prices on certain things, but going into this holiday we thought it was really important that we maintain the prices that we have.”

It seems then that Microsoft might be following Sony’s example after all, after the company announced earlier this year that it would be raising the price of the PlayStation 5 due to “high global inflation rates, as well as adverse currency trends.” Microsoft at the time said that it had no plans to follow suit with its Xbox Series X|S, with Spencer noting that it wasn’t the “right move” given the current financial constraints on customers.

Elsewhere in the call, Spencer gave some rare insight into the financials behind its Game Pass service, revealing that he expects it to continue to make up around 10-15 per cent of Xbox’s content and services revenue and stressed that it is profitable for the company.

“Game Pass as an overall part of our content and services revenue is probably 15 percent,” Spencer said. “I don’t think it gets bigger than that. I think the overall revenue grows so 15 percent of a bigger number, but we don’t have this future where I think 50–70 percent of our revenue comes from subscriptions.”

In other gaming news, The Callisto Protocol has been cancelled in Japan due to the developer refusing to censor the game’s violent content.

While Microsoft has avoided following Sony’s example of raising the price of their consoles so far, Xbox head Phil Spencer has admitted that it may “have to raise the price on certain things.”

• READ MORE: Best Xbox Series X|S games to play in 2022
  

Spencer was speaking at the Wall Street Journal‘s Tech Live (thanks, The Verge), where he dropped the first hints that Microsoft may be looking at raising the prices of its consoles and/or subscription services.

“We’ve held price on our console, we’ve held price on games and our subscription. I don’t think we’ll be able to do that forever,” said Spencer. “I do think at some point we’ll have to raise some prices on certain things, but going into this holiday we thought it was really important that we maintain the prices that we have.”

It seems then that Microsoft might be following Sony’s example after all, after the company announced earlier this year that it would be raising the price of the PlayStation 5 due to “high global inflation rates, as well as adverse currency trends.” Microsoft at the time said that it had no plans to follow suit with its Xbox Series X|S, with Spencer noting that it wasn’t the “right move” given the current financial constraints on customers.

Elsewhere in the call, Spencer gave some rare insight into the financials behind its Game Pass service, revealing that he expects it to continue to make up around 10-15 per cent of Xbox’s content and services revenue and stressed that it is profitable for the company.

“Game Pass as an overall part of our content and services revenue is probably 15 percent,” Spencer said. “I don’t think it gets bigger than that. I think the overall revenue grows so 15 percent of a bigger number, but we don’t have this future where I think 50–70 percent of our revenue comes from subscriptions.”

In other gaming news, The Callisto Protocol has been cancelled in Japan due to the developer refusing to censor the game’s violent content.