Even Microsoft’s recently announced price increase on its Xbox Series X console was a modest increase. This decision indicates the continuing struggles happening behind the scenes of the gaming industry. The price increase will push prices up by $100 (£75) to $130 depending on the model. The once uncatchable firm is now reportedly facing soaring production costs for consoles and games alike. This has resulted in zero growth in users in its console video game division for the last 20 years.
In the United States, this is where price adjustment sticks out most clearly. Tariffs on imports from China have compounded the crisis. Industry analyst Christopher Dring further emphasized that these tariffs make up a fundamental part of Microsoft’s pricing strategy. He stated, “With accessories and components made in China, the connection is pretty obvious.” In turn, consumers can expect to pay more because of these tariffs, which have wreaked havoc on the global economy with their unpredictability and uncertainty.
Historically, video game consoles follow a predictable pattern where they lose value after launch. This generation has bucked that trend. Those recent moves represent a major turn of the tide in the industry, with gamers paying more instead of less. “Gamers will suffer most, with little hope of prices decreasing,” remarked Kedhrin Gonzalez, founder of Rip & Tear studios. He described the price rise as “inevitable” and suggested it has been “catalysed by current tariff disruptions.”
Microsoft’s approach also extends to its pricing strategy across all platforms, ensuring consistency regardless of where consumers purchase their consoles. The company punctuated their business acumen by stating that they didn’t raise prices until they thoroughly weighed market conditions. They considered the rising cost of building. “They were made with careful consideration given market conditions and the rising cost of development,” said Microsoft.
The gaming ecosystem is going through some massive changes. You no longer get discounts on first-party games like Mario Kart if you buy them digitally. In comparison, physical products for Microsoft’s Series X are usually much pricier. This difference highlights the challenges that consumers face. They have to contend with expectations of console and game prices in a market that continues to raise costs.
As Microsoft follows through with these changes, it further complicates the narrative as console pricing remains under a cloud of economic headwinds. The stakes for consumers are still extremely high as the battle for industry supremacy rages on.