Free Xbox Cloud Gaming With Ads Could Be an Alternative to Pricier Game Pass

Xbox Game Pass will have a new, higher price for the game subscription service starting Nov. 4. 

With the news that Microsoft’s popular franchise Halo will make the jump to the PlayStation platform for the first time with next year’s Halo: Campaign Evolved, the company confirmed it is testing a free ad-supported version of its Xbox Cloud Gaming, which is included in the Game Pass service. 

A Microsoft official confirmed to The New York Times on Friday that it is conducting internal tests of this ad-supported service. This service would allow access to some games via Xbox Cloud Gaming, though it’s not clear how many would be supported. 

This confirms a report from The Verge earlier this month, which revealed rumored details about the offering. Microsoft employees have been testing the service, which allows the streaming of some games in a user’s library, as well as Xbox Retro Classic games and Free Play Days titles. During the test, about 2 minutes of ads play before a person can stream a game. 

According to the report, it’s available on PCs, Xbox consoles, handheld devices and web browsers. 

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Microsoft didn’t immediately respond to a request for more details about this ad-supported service. 

It’s unclear if Microsoft will officially include this free service as a free tier in Xbox Game Pass or if it will roll out when subscription prices jump on Nov. 4. Other streaming video services, such as Netflix, Disney Plus and Hulu, have added a lower-priced, ad-supported tier to their membership options in recent years. As of May, almost half of streaming service subscriptions were ad-supported plans. 

Microsoft’s Xbox business has been a bit rough for the company this year. Its Xbox Series X|S console sales have dropped by 22% from last year, which is likely due to increasing the price of its hardware twice, ostensibly due to tariffs, making the Xbox Series X console $150 more expensive than when it launched almost five years ago. Xbox Game Pass, usually a bright light among the Xbox woes, had so many cancellations after the news of the price increase that it crashed the service’s cancellation page. 

According to a Bloomberg report, Microsoft has also had multiple rounds of layoffs in the Xbox division and canceled game projects, such as a reboot of Perfect Dark, in an attempt to increase its profit margin above the industry average.