Xbox cloud console, streaming-only Game Pass tier hinted at by Microsoft

Xbox will expand even further into the cloud, likely facilitated through a combination of new hardware, software, and services.

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Microsoft has made big moves in cloud streaming with its Project xCloud infrastructure, and since inception the technology has evolved significantly. Xbox users can now stream games with less friction across the entire platform, with a myriad of options to choose from--remote play, streaming to mobiles & consoles, etc.

Now that its valuable software catalog is deeply embedded into the cloud following the FTC v Microsoft trial in 2023, Xbox has informally announced plans to further invest into cloud gaming. How that will happen remains to be seen, but Microsoft had been internally developing a cloud-only video game device similar to a set-top box codenamed Keystone. This device would have been low-cost and offer users an easier gateway into the Xbox platform.

In a recent update on the Xbox business, Microsoft exec Jason Beaumont confirmed that Microsoft will continue its journey into the clouds:

"The big thing from the community is that they're playing more Xbox games in more places than ever before. That's why so many of our investments are about being able to pick up and play your games no matter where you are, no matter what device you're on.

"A big part of that investment is our continued expansion of cloud gaming and making that more accessible to more people. I'm really excited about the announcements that we're going to have in the coming months along those lines."

Microsoft has already confirmed a multi-year agreement with AMD to make customized AI-based silicon for a number of different hardware configurations. One of the mentioned targets was cloud, indicating that Microsoft may not have scrapped its plans for Keystone, but may have simply been holding off until the appropriate technology became available.

It's also possible that Microsoft could launch a cloud-only Xbox Game Pass subscription tier as a way to break up the value proposition into individualized pieces.

Nothing has been announced at this stage regarding either of these speculations.