There have been rumors over the past few weeks that Microsoft was planning to announce a new subscription. Today’s announcement lines up with those rumors. Microsoft is launching Xbox All Access in the U.S., which includes a console, Xbox Live Gold and Xbox Game Pass.
You get to choose between an Xbox One S for $22 per month or an Xbox One X for $35 per month. After paying for 24 months, the subscription stops and the console is yours. You can then choose to keep paying for Xbox Live Gold and Xbox Game Pass or you can cancel your subscriptions — it’s your console after all.
So let’s do the math. You can currently buy an Xbox One S for around $299. Xbox Live Gold lets you play multiplayer games and access free games for $60 per year. The Xbox Game Pass lets you download and play games from a library of 100+ games for $9.99 per month — it’s a sort of Spotify for video games.
If you buy a console and subscribe for two years, you’ll end up paying around $659. An Xbox All Access subscription lets you save around $130. If you already planned on subscribing to those two services, it sounds like a good deal. If you didn’t really care about Xbox Game Pass, you’ll end up paying more than buying a console the normal way.
The Xbox One X currently costs around $499. If you add two years of Xbox Live Gold and Xbox Game Pass, the bottom line is $859. Two years of Xbox All Access with the Xbox One X costs $840. So it’s not that good a deal if you’re interested in the Xbox One X.
With this new offering, Microsoft shows that it wants to shift its gaming strategy to subscriptions. Buying a console every few years isn’t as lucrative as buying an all-in-one Xbox subscription. Subscriptions increase customer loyalty and create predictable recurring revenue.
More importantly, gaming consoles won’t stick around forever. At some point, games will run on expensive servers in the cloud and you’ll subscribe to a service. Rumor has it that Microsoft is already getting ready to launch a low-powered system to stream games from the cloud. This is what Microsoft is thinking about with Xbox All Access.