Microsoft Reportedly Testing Free Xbox Cloud Gaming Supported by Ads With Monthly Play Limits — Announcement and Launch Coming Soon

Microsoft is reportedly set to announce and launch a free version of Xbox Cloud Gaming with ads for PC, Xbox consoles, handheld devices, and the web.

The Verge’s Tom Warren reports that Xbox Cloud Gaming supported by ads is currently being tested internally, and does not require a Game Pass subscription. A public test is said to be coming soon with a release in the months ahead.

Warren’s sources indicate Microsoft is testing approximately two minutes of ads before a game is playable for free via streaming. Microsoft is also apparently testing a limit of one hour for sessions, with up to five hours free a month. But, as Warren points out, this might change for launch.

The report comes after Microsoft sparked a backlash for raising the price of Xbox Game Pass Ultimate from $19.99 a month to $29.99 a month (an extra $120 a year).

To justify the increase in price of Ultimate, Microsoft has increased the number of day one releases per year to 75, and has added Fortnite Crew and Ubisoft+ Classics for the first time ever. Xbox Cloud Gaming, which has officially left beta, has seen its streaming quality upgraded.

However, it appears Microsoft also quietly pulled the 10% discount on DLC for Game Pass games that Ultimate subscribers were able to get, seemingly in favor of its new Rewards scheme.

Microsoft said the new $30 a month Ultimate price reflects “the expanded catalog, new partner benefits, and upgraded cloud gaming experience.”

The updated pricing went into effect on October 1 for new subscribers, and will go into effect on November 4 for current subscribers. As part of the announcement, Microsoft added more than 45 new games to Game Pass, including Hogwarts Legacy. Check out the full list here.

The news comes at a time when Game Pass is under scrutiny not just for its value to Microsoft’s gaming business, but to the wider video game community. Last month, after former Bethesda executive Pete Hines questioned Xbox Game Pass as a business strategy, a former Microsoft executive backed the comments, insisting Microsoft’s subscription service creates “weird inner tensions.”

In July, amid layoffs that swept through Xbox, the founder of Microsoft-owned Arkane Studios hit out at Game Pass, whose subscription model he called “unsustainable.” Raphael Colantonio, who founded the Dishonored and Prey developer and served as its president before leaving in 2017 to start Weird West maker WolfEye Studios, took to social media to ask: “Why is no-one talking about the elephant in the room? Cough cough (Gamepass).”

When asked to expand on his thoughts on Game Pass, which Weird West launched straight into as a day one title in March 2022, Colantonio said: “I think Gamepass is an unsustainable model that has been increasingly damaging the industry for a decade, subsidized by MS’s ‘infinite money,’ but at some point reality has to hit. I don’t think GP can co-exist with other models, they’ll either kill everyone else, or give up.”

Microsoft has insisted “creator participation” and “player engagement” in Game Pass are at an all-time high, but failed to announce an updated subscriber number this week. Microsoft has said that the subscription service reached a new annual record of nearly $5 billion in revenue for the first time this year, following the launches of The Elder Scrolls Oblivion: Remastered, Doom: The Dark Ages, and Indiana Jones and the Great Circle.

The cost of being an Xbox fan has been a hot topic in recent months. After announcing a jump to $80 for its games due out this holiday, Microsoft back-tracked to stick with $70 for the likes of The Outer Worlds 2. And just last month Microsoft raised the price of Xbox consoles in the U.S. "due to changes in the macroeconomic environment."

Wesley is Director, News at IGN. Find him on Twitter at @wyp100. You can reach Wesley at wesley_yinpoole@ign.com or confidentially at wyp100@proton.me.