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Xbox Boss Phil Spencer Says Price Hikes Are Coming, But Not Until After The Holidays

"I do think at some point we'll have to raise the prices on certain things..."

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Speaking today at a Wall Street Journal event in southern California, Microsoft Gaming CEO Phil Spencer said he believes prices for certain Xbox products or services will go up, but not until after the holidays.

"I do think at some point we'll have to raise the prices on certain things, but going into this holiday we thought it was important to maintain the prices," Spencer told the audience, as relayed by Tom Warren of The Verge.

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Spencer was apparently speaking generally about price increases at Xbox and not about any one specific product or service. But people are assuming he's referring to potential price increases for Xbox consoles or services like Xbox Game Pass.

Subscription services across entertainment regularly see their prices increased--Disney+ is the latest to see a price hike, rising to $11/month in December. Netflix, Hulu, and others raise prices from time to time as well.

If it's a price increase for the Xbox console that's coming, that wouldn't be too surprising, either. Supply chain and logistical issues have driven up production costs, and Microsoft could decide to pass along the costs to the consumer with a price hike. Sony did this with its recent PS5 price hike in certain regions.

In August, in the wake of Sony raising the price of the PS5, Microsoft said it was "constantly evaluating" its business with respect to pricing, but the existing US MSRPs for the Series S ($300 USD) and Series X ($500) will remain in place for the time being. The company never, however, strictly ruled out a price hike down the road.

Not raising prices until after the holidays is seemingly a strategic decision on Microsoft's behalf to help make the Xbox platform stand out even more as a more economical choice for people getting into gaming. After all, the real money in games comes from software and services, so even if the profit margins on Xbox consoles take a hit due to the supply chain and logistics issues, software and service revenue could help fill the gap.

Microsoft's Xbox division is riding high right now. Xbox made more money over the past three months than it ever has during a different Q1 period in the company's 20-year history.

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Millionsedge

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Can we get a quality hike to come with the price hike? *cough* Halo *cough*

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illegal_peanut

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Knowing they could've easily just made us all pay an extra $20 to $100 on each XBSX this holiday, like every other company is doing now, but don't.

Is why I say it's utterly asinine to hate Phil Spencer's philosophy and motives on gaming.

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Crazy_sahara

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Edited By Crazy_sahara

After the holidays you say hmmm.

Guess it's time to buy 3 years soon of gamepass again from Bosnia...

Their currencys worth shit.

(Ps, I'm no one's friend...)

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GalvatronType_R

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Xbox and video games writ large are frivolous luxury toys. Rolexes cost more now than they did five years ago. Low prices on non-essentials are not a human right. If I could get sheep to pay more for my products, I’d do it in a heartbeat. Separating idiots from their money is the American way.

If you don’t like it, don’t buy it.

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BDRTFM

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Bad idea. First thing people do away with during economic decline - discretionary spending. Food prices are skyrocketing with no end in sight. Less disposable income means Little Johnnie might not be getting that $600 game console. Especially if it goes up $50 and the games and accessories go up as well. Sony kills Microsoft in console sales already. Even with the PS5 price hike, I'm guessing it's still easily outselling the XsX. IF MS raises the price of current gen consoles or games and subs, they're risking losing more market share to Sony and selling less of those games and subs where the real money is. Can a little pain now for greater gains later hurt that badly when you're a trillion dollar company?

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deactivated-64a3ced8b46b8

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"Certain things?"

Hmm, I wonder...

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quinnd6

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Increasing prices of consoles is ridiculous.

Sony shouldn't have done it and Microsoft shouldn't do it either.

What I've noticed is that even with Sony jacking up the PS5 price in Europe, it's still selling out extremely fast and is very hard to find one. You still can't go into a shop and get a PS5 where I am. You have to go online and order it and wait a few weeks to get one in most cases.

The Xbox Series X on the other hand has been widely available in shops in Europe for months and you can just go into a shop and buy one no problem.

I think it's down to Microsoft's lack of big exclusive games. Microsoft are way behind in Europe and even though the PS5 is 50 euros more expensive, people don't seem to care, they're still going mad for it and it's selling out like hotcakes. That's what it seems like to me anyway. So if Microsoft increase the price of the Series X in Europe they'd make it even worse for themselves and it just wouldn't sell well at all.

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Avatar image for deactivated-64a3ced8b46b8
deactivated-64a3ced8b46b8

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@quinnd6: "Increasing prices of consoles is ridiculous."

I don't think that's what he's referring to, but I could be wrong.

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Avatar image for deactivated-64efdf49333c4
deactivated-64efdf49333c4

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@quinnd6: Why is it ridiculous? Inflation has jacked up the cost of living across the board. Why should gaming be the exception?

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quinnd6

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Edited By quinnd6

@Barighm: Well I suppose you're right. In normal times it would be ridiculous. We're living in very screwed up times now though unfortunately.

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Spartan_418

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You'd think keeping the console prices the same would be a smart move, competitively, given the PS5 price hike for most of the world, and how supply issues have eased and the Series X is no longer such a rare commodity.

Right now is the first time I've checked my nearby Target and Best Buy listings where it's turned out yes, they both have the Series X in stock.

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GamerBum

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Edited By GamerBum

And Uncle Phil also said the Xbox Game Pass is now profitable. I thought as much. I found it hard to believe it wasn’t when the $3.9 billion number was mentioned from the Brazilian regulators.

Que the pony clowns saying Phil’s lying lmao!

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Avatar image for deactivated-64efdf49333c4
deactivated-64efdf49333c4

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@gamerbum: No, it being profitable coinciding with a price hike makes sense. A lot of us have been saying something along those lines for a while now, but figured they'd keep the price down anyway because it was a solid competitive tactic. Guess not.

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deactivated-64efdf49333c4

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@girlusocrazy: Their PC store is doing poorly? By the sound of things, it's going exactly how I suspected it would: they're leveraging Windows, as they always do eventually, and console has its usual peak...which Phil said it would.

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GamerBum

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Edited By GamerBum

@girlusocrazy:

It’s not a guesstimate for the future he said it is profitable meaning now. What is it with you ps fanboys that just can’t except this? WEIRD!

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deactivated-64efdf49333c4

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@girlusocrazy: Ah, I haven't seen that report yet.

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mediastupid1

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Edited By mediastupid1

@gamerbum: *Accept.

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Avatar image for deactivated-64efdf49333c4
deactivated-64efdf49333c4

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@mediastupid1: He can't. Even when we're giving him perfectly neutral responses, he's trying to start shit. Pretty much proved without a shadow of a doubt he's a troll right here.

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Avatar image for deactivated-64a3ced8b46b8
deactivated-64a3ced8b46b8

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@Barighm: I think they were trying to correct gamerbum's spelling.

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BryanWeary

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Edited By BryanWeary

@thecupidstunts: Actually, I do believe that may fall under a grammatical correction, as "except" was actually spelled correctly. It just wasn't the correct word for the situation. ;)

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deactivated-64a3ced8b46b8

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@bryanweary: Good call.

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