'Game Pass is too expensive for players, we need a better equation,' Xbox CEO Asha Sharma says

Xbox's new CEO Asha Sharma is taking aim at Game Pass' rising fees, saying that gamers need more affordable and flexible options.

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A newly leaked internal memo shows that Game Pass is top of mind for Xbox's fresh-faced CEO. The division changed leadership after Phil Spencer retired, with Sharma then taking the helm and bringing a new emboldened and energetic spirit to Xbox. After revealing the next-gen Project Helix hybrid PC console, Sharma is now scrutinizing the multi-tier Game Pass model, especially the costly $30/month Game Pass Ultimate subscription.

In the memo, which was acquired by The Verge, the new Xbox CEO acknowledges that Game Pass is too costly for gamers and unwieldy for Microsoft, leading to a very inflexible and rigid model. Sharma says that Game Pass hasn't reached its final form yet.

"Game Pass is central to gaming value on Xbox. It's also clear that the current model isn't the final one. Short term, Game Pass has become too expensive for players, so we need a better value equation. Long term, we will evolve Game Pass into a more flexible system which will take time to test and learn around," Sharma said in the memo, as per The Verge.

Insofar as Game Pass' unyielding lack of flexibility, this is terminology that I used a day ago when describing Game Pass because the service tries to host interactive entertainment in the same way that Netflix hosts static video, leading to friction in usage habits.

Plus, the unrestricted and improperly-cordoned flow of content means that a few big games can weigh down the service by attracting millions more players than other games--titles like Call of Duty, Minecraft, and even Sea of Thieves could be much more popular than other titles. This creates a certain kind of unique competition where Microsoft's first-party teams are technically competing with one another, vying for players, engagement, and playtime on the service.

Microsoft is believed to have raised Game Pass Ultimate prices to create one of these concentrated wells of player activity by releasing one of the biggest franchises in the industry onto the service--Call of Duty.

It was assumed that Game Pass Ultimate jumped to $30/month due to the service's inclusion of new Call of Duty games, which launch into the service day and date (but only in the more expensive Ultimate tier). This would see Call of Duty's short-term sales revenues impacted by the potential of longer-term microtransaction spending and continued subscriptions, if, of course, Activision could hook players.

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Game Pass may have shed a considerable amount of users due to the cost increases, which saw Microsoft raising the price of Game Pass Ultimate 3 times in 3 years, starting with the first hike in 2023 after the company acquired Activision.

There hasn't been an update to Game Pass subscriber numbers for a while now, indicating a potential level of churn that Microsoft may not necessarily be comfortable in disclosing, however Microsoft did say that Game Pass made nearly $5 billion in revenue throughout Fiscal Year 2025.

That's a lot higher than the $2.9 billion in gross subscription revenue that Xbox Game Pass earned throughout 2021.

Just yesterday, we reported on rumors that Windows Central editor Jez Corden recently discussed about Microsoft potentially removing Call of Duty from Game Pass, thereby facilitating a way to reduce fees for subscribers.

Nothing has been ironed out yet, and it does seem that Microsoft has yet to figure out the intricate ins and outs of Game Pass, which is a sentiment that co-Netflix CEO Greg Peters recently shared.

It was revealed that Xbox's Sharma had reached out to Peters to discuss possible collaborations between Game Pass and Netflix, which could end up being a tough sell considering both of the subscriptions are fierce rivals to one another.

This is especially true now that Netflix has launched games of its own, including a kid-friendly app that has exclusive games content.