Microsoft is reportedly beta testing a new free version of Xbox Cloud Gaming, which will be ad-supported, marking a significant shift in its gaming strategy. This version will allow players access to games on PC, Xbox consoles, and mobile devices without requiring a Game Pass subscription. Users may encounter around two minutes of advertising prior to gameplay and could experience a session limit of one hour, with a cap of five hours available per month. This initiative comes on the heels of a price hike for Xbox Game Pass Ultimate, raising it from $19.99 to $29.99 a month, a move that has drawn criticism within the community. Microsoft defends this increase by highlighting more game additions and enhanced streaming quality.

Though Game Pass has generated significant revenue, it has faced scrutiny regarding its sustainability as a business model. Critics argue that it might disrupt the traditional gaming industry, as recent comments from ex-Bethesda and Arkane Studios executives have suggested that it creates "weird inner tensions." The move to introduce ad-supported cloud gaming may be an attempt to diversify revenue streams amidst these debates.

What are the main benefits of the new ad-supported Xbox Cloud Gaming?

The main benefits include free access to Xbox Cloud Gaming without a Game Pass subscription, giving players a chance to experience a variety of games. Additionally, the ad-supported model may attract more casual gamers who are hesitant to invest in a subscription. This format allows for budget-friendly gaming experiences and enhances accessibility to a broader audience.

For background context, Xbox Game Pass is a subscription service that provides gamers access to a vast library of games for a flat monthly fee. It has been a major player in the gaming industry since its launch, impacting how games are consumed and influencing pricing strategies across the market. Microsoft has continuously expanded the service, launching titles on the same day as retail releases, which has created competitive pressure on developers and other subscription services.