Xbox Chief Asha Sharma Signals Game Pass Pricing Changes

Asha Sharma, the new CEO of Microsoft Gaming, has acknowledged that Xbox Game Pass has become too costly for its user base. In a leaked internal memo obtained by The Verge, Sharma stated that the service has become too expensive for players and emphasized that Microsoft requires a better value equation to maintain its appeal.

The admission comes as Sharma seeks to stabilize the subscription service following a series of aggressive price increases. According to the memo, Sharma views the current pricing structure as a temporary phase rather than a permanent strategy, noting that the service will eventually evolve into a more flexible system through a process of testing and learning.

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.

Asha Sharma, CEO of Microsoft Gaming

Leadership Transition and Strategic Shift

Asha Sharma assumed the role of CEO of Microsoft Gaming in February 2026, succeeding Phil Spencer, who had led the Xbox division for nearly 12 years. Sharma previously served as the firm’s CoreAI Product president.

Since taking the helm, Sharma has signaled a commitment to Xbox’s console business and has hinted at the potential return of Xbox exclusives. Her current focus involves making Xbox products and the Game Pass subscription more enticing to a broader range of customers, according to reports from The Information.

The Impact of 2025 Price Hikes

The push for more affordable options follows a period of significant cost increases throughout 2025. Microsoft raised the prices of Xbox consoles and accessories in May 2025, followed by another increase in U.S. Console pricing in September 2025.

In October 2025, Microsoft implemented substantial price hikes for Game Pass, with the Xbox Game Pass Ultimate tier seeing a 50% increase. The current pricing structure following those hikes includes:

• Xbox Game Pass Ultimate: $30 per month
• PC Game Pass: $16.50 per month
• Game Pass Premium: $15 per month
• Game Pass Essential: $10 per month

These costs, combined with hardware prices that start at $400 for the cheapest Xbox Series S and reach $800 for the Galaxy Special Edition in the U.S., have created a high barrier to entry for price-sensitive consumers.

Proposed Pricing Models and Partnerships

To address these affordability concerns, Sharma is reportedly exploring the introduction of lower-priced tiers that would sit below the current $10 Essential tier. One specific model under consideration is an ad-supported tier, a strategy similar to the lower-priced plans offered by Netflix.

Under an ad-supported model, subscribers could potentially receive free or heavily discounted access to Game Pass titles or Xbox Cloud Gaming in exchange for watching advertisements.

Beyond internal pricing changes, Microsoft is exploring external partnerships to increase the value proposition of its services. Netflix CEO Greg Peters has confirmed meeting with Sharma several times to discuss potential subscription bundle partnerships.

These discussions are part of a broader effort by Sharma to expand the reach of the service. During her visit to the Game Developers Conference in San Francisco in March 2026, Sharma met with high-level executives and indie developers to outline her vision for the brand’s future.