Skip to main content

Rumor: Microsoft prices new Xbox at $500 upfront, $300 with subscription

Xbox logo
Image used with permission by copyright holder

For all of the myriad rumors, leaks, and highly suggestive business developments within Microsoft that illuminate what the Next Xbox will be, Microsoft remains mum about the specifics. The console may be called Durango or simply “Xbox.” It may be upgradable. It may have, at one point, been called Yukon. It may require a persistent Internet connection to even use. As the tech and entertainment industries wait with baited breath to see just how different Sony and Microsoft’s new machines will be, Microsoft’s next effort in the video game console business remains a mystery this spring. For the average player, though, only one question matters: How much will it cost?

According to Microsoft reporter Paul Thurrot of Supersite for Windows, the Next Xbox will cost between $300 and $500.

Rather than selling two differently priced models with different memory capacities as it did with the Xbox 360, Microsoft will offer the Next Xbox as a single model at two different prices. The box will be $500 on its own, but $300 with a contract subscription alongside it. Thurrot references internal documents about the device as his source of information. The Verge claimed its sources backed up Thurrot’s information.

There is plenty of evidence to support Thurrot’s claims in Microsoft’s current business models. The company began selling subscription subsidized Xbox 360s through its own stores and retailers like Best Buy in mid-2012. By signing up for a two-year monthly subscription to Xbox Live Gold, which is more expensive than the standard monthly fee, an Xbox 360 can be purchased for $99 up front. Microsoft has indicated multiple times that it would continue exploring subscriptions as a console pay model. The $500 price tag on the standalone model is also not terribly surprising. Competitor Apple has had great success selling devices like the iPad at higher price points alongside a subscription subsidized model.

Thurrot detailed other tidbits about Microsoft’s future in the console business. His documents seem to confirm the Next Xbox’s need for a perpetual connection to the Internet. A new Xbox 360 will also be introduced alongside the machine at just $99 sans subscription. 

These prices are notably higher than previous estimates. Baird Equity Research said in January that it expected Sony and Microsoft to follow the same multiple console options as the Xbox 360 and PlayStation 3 this year for their new consoles. The PlayStation 4 and Next Xbox would be offered in $350 and $400 packages. That may still be true.

If Sony is able to offer the base PlayStation 4 without a subscription attached to it for $400, undercutting Microsoft by $100, that would be a significant coup for the company. Sony struggled to sell the PlayStation 3 at $500 and $600 when it came out in 2006 against the $300/$400 Xbox 360.

Editors' Recommendations

Anthony John Agnello
Former Digital Trends Contributor
Anthony John Agnello is a writer living in New York. He works as the Community Manager of Joystiq.com and his writing has…
Microsoft beat the FTC. Here’s what the controversial court ruling means for Xbox
Xbox's logo used during the Extended Games Showcase

You’ve probably heard that the Federal Trade Commission (FTC) lost its case against Microsoft after an exciting and revelatory trial. On Tuesday, Judge Jacqueline Scott Corley denied FTC's motion for a preliminary injunction to block Microsoft’s acquisition of Activision Blizzard before its potential completion by July 18. Ultimately, Corley did not believe that Microsoft owning Call of Duty would “substantially lessen competition” in the game industry. It was major win for Microsoft after months of regulatory hoops and roadblocks, but the FTC quickly moved to appeal the decision. This all raises an important question: What’s next?

Over the next week, Microsoft, Activision Blizzard, and the FTC will determine the fate of the gaming companies involved in this acquisition and set a precedent for the future of the game industry. On top of that, Microsoft still has to deal with the next moves made by the U.K.'s Competition and Markets Authority (CMA), which wants to block the acquisition due to its impact on cloud gaming. Following the release of Judge Corley’s Preliminary Injunction Opinion, I spoke to two analysts and a lawyer with knowledge of the video game industry to better understand what lies ahead for Microsoft and Activision, the FTC, and the CMA. The battle isn't quite over yet, even if the end is finally on the horizon.
What’s next for Microsoft and Activision Blizzard
Currently, Microsoft and Activision are in a solid position, as a Judge has ruled that Microsoft is unlikely to pull Call of Duty from PlayStation or lessen competition in the game console, cloud gaming, or game subscription markets by acquiring Activision Blizzard. There’s a temporary restraining order in place until July 14, which the FTC hopes to successfully appeal during. As soon as that order is up, though, Microsoft and Activision Blizzard have until July 18 to complete the acquisition.

Read more
Microsoft wins FTC case, removing Xbox’s biggest Activision Blizzard acquisition hurdle
Characters shooting in Call of Duty: Modern Warfare 2.

Following a multi-week court case, Microsoft has won its battle with the Federal Trade Commission regarding its proposed Activision Blizzard acquisition. The ruling is a major win for Microsoft's troubled deal, clearing the biggest hurdle it faced.

Last January, Microsoft announced its intention to acquire Activision Blizzard for $69 billion. The blockbuster announcement immediately raised antitrust concerns, which resulted in the FTC filing a legal challenge in December 2022. Microsoft has not been able to proceed with the acquisition since then, as its faced similar scrutiny in the U.K.

Read more
Microsoft to pay $20M over Xbox child privacy violations
Microsoft signage at the Meridian Building (formerly CompuWare) in Detroit, Michigan.

Microsoft has agreed to pay $20 million to U.S. regulators for violating the Children's Online Privacy Protection Act (COPPA).

The breach involved the computer giant collecting and retaining personal information from children who set up an Xbox account prior to obtaining permission from their parents.

Read more