Microsoft to raise price of new Xbox games in 2023

Yahoo Finance tech editor Dan Howley details Microsoft's plans to increase the cost of its new Xbox games starting in 2023.

Video transcript

[AUDIO LOGO]

SEANA SMITH: Dan, let's also talk about Microsoft, another company that you follow very closely. Some news out just in terms of the pricing of their games. It looks like it could go from $60 to $70. What can you tell us about that?

DAN HOWLEY: Yeah, this is not exactly unprecedented, the idea that they would be raising prices to $70. There are some games out there that are already $70. Microsoft previously said that they're going to have to raise some prices, otherwise, it's just going to be an untenable situation for them with Xbox.

One of the things that they're trying to do is get their cloud streaming service really into people's hands, where you can stream service-- stream games to your TV, your low-powered smartphone or Chromebook, anything along those lines, without needing a console. But part of the business is still console-based, and so they need to sell those games. And development of games has increased, ballooned over the years, so going to $70 isn't exactly unheard of.

And, like I said, some games are already selling at $70, but Microsoft said they didn't want to do it until into 2023. So they're not going to be doing it in the holiday season and kind of really hitting people over the head at a time when, obviously, there's inflation and people worried about how much they're spending. So they're going to seemingly keep the prices the same for the holiday season now.

DAVE BRIGGS: Speaking of the holiday season, real or fake, the tree?

DAN HOWLEY: Oh, it's fake. My God, our cats would try to eat it right away. Although we did have one of the chunky boys in it yesterday--

[LAUGHTER]

--almost knocking it down.

DAVE BRIGGS: Can't wait to see--

DAN HOWLEY: It was like--

DAVE BRIGGS: --that cat make--

DAN HOWLEY: It was like--

DAVE BRIGGS: --a cameo.

DAN HOWLEY: --an anvil trying to-- it was like an anvil weighing down a twig. It was pretty-- it was pretty bad.