The latest Xbox Cloud Gaming upgrades are a revelation — is Microsoft’s cloud gaming vision FINALLY ready to go mainstream?

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Just before summer ended, Microsoft announced a significant price increase – a 50% jump – for Xbox Game Pass, which understandably upset many subscribers. The news was met with a lot of negative reactions online.

The cost of nearly everything is rising, from utilities to food, and it feels like large corporations are determined to maximize profits. Recent financial reports from Xbox suggest a possible reason why this might be happening, as the company is experiencing declining performance.

Xbox has been struggling recently, with console sales declining and slow growth. Microsoft seems to be prioritizing areas other than its Xbox console, and CEO Satya Nadella suggests that short-form videos, like those on TikTok, are partly to blame, as they’re capturing people’s attention away from gaming – and there’s some truth to that idea.

The popularity of easily accessible and engaging short-form video platforms like TikTok and Instagram Reels likely contributes to the slower growth we’re seeing in the gaming industry. Imagine if people could play games without needing to buy expensive equipment like PCs or consoles.

Microsoft has been investing a lot in Xbox Cloud Gaming for a good reason. While it’s gotten better over time, it hasn’t always felt like playing on a real console, particularly on bigger TVs – but that’s changing now.

Finally delivering the “console quality” promised for years …

While Xbox Game Pass Ultimate recently became more expensive with a 50% price increase, some good news came alongside it. The Essential and Premium plans now include Xbox Cloud Gaming for free, and Ultimate subscribers can now enjoy games in 1440p resolution at 60 frames per second with improved streaming quality.

The recent improvements appear to be fully implemented now. However, it seems the new streaming method will be released gradually, game by game, depending on how much it’s used. Currently, Fallout 4, Cyberpunk 2077, and The Witcher 3 are the only games I’ve found that support it.

The video demonstrates a significant improvement in video quality. Older 3D games used to show blurry, pixelated visuals when the camera moved quickly, but this new encoding makes the image look clear and sharp, almost like playing on the original hardware. The game also runs smoothly at a consistent 60 frames per second, and the delay between your controller inputs and what you see on screen is very minimal. I’ve heard that Microsoft’s next Xbox controllers will use Wi-Fi Direct to connect directly to the streaming device, which should eliminate almost all remaining lag.

It’s currently unknown which games support the new “next-gen” cloud access, but it seems Microsoft intends to make it available for all 3D games eventually. I tested it with Dying Light: The Beast, and unfortunately, it defaulted to the older system, resulting in a sluggish 30 frames per second with low video quality. While the connection was stable, after playing The Witcher 3 and Fallout 4 on the improved system – which looked fantastic – it was hard to go back to the lower quality experience.

I really wanted to give a fair look at cloud gaming in my video, so I set up what I thought was the *perfect* scenario. I was streaming to my Xbox Ally with a super fast 1GB internet connection, using the latest Wi-Fi 6E on the 5GHz band, and I was literally right next to my router! Plus, I’ve got a really solid mesh Wi-Fi system to boost the signal, so everything *should* have been flawless.

I wanted to test how well the new system would perform with a less-than-ideal 5G connection. My signal is usually pretty weak – I get one to three bars at best, even though the nearest 5G tower is only 200-300 meters away. The signal also has to go through the thick walls of my building. I was really surprised to find that it still ran incredibly smoothly, even with a somewhat unstable 50MB connection. I experienced no lag, and the video quality and frame rate were both good.

Microsoft has been talking about this experience for a long time, and now it’s available. The big question is, will enough people actually use it?

… but is there actually a big market for this?

While playing Xbox games like The Witcher 3 on a small phone screen probably won’t become mainstream, streaming directly to your TV seems like a much more likely future for Xbox gaming.

As an analyst, I’m seeing cloud gaming as a key part of Microsoft’s future plans for Xbox, especially as traditional console sales slow down. They’re already making headway with integrations into Samsung and LG TVs. What’s particularly interesting is the new Xbox controller with Wi-Fi – it should significantly improve the cloud gaming experience by addressing access and lag issues. And, according to my sources at Microsoft, they’re exploring a free, ad-supported tier for Xbox Cloud Gaming, mirroring NVIDIA’s GeForce Now model. This could really broaden access and drive user growth.

Running cloud services is costly. Maintaining data centers requires significant investment, and Microsoft ultimately covers the electricity used for gaming that would normally happen on your personal devices. It’s unclear how they make that financially sustainable.

Xbox Game Pass generates revenue that pays for new games and content on Xbox consoles and PCs. However, running the cloud gaming servers also costs money. As more people switch to playing games on the cloud, it raises the question of whether less funding will be available for creating new content. It’s unclear how much Microsoft is currently losing on Xbox Cloud Gaming, and whether it could face the same fate as Google Stadia or Amazon Luna. Ultimately, it remains to be seen if cloud gaming will attract entirely new players, or simply get existing Xbox users to play in a different way.

Xbox Cloud Gaming makes gaming more accessible, but it doesn’t completely remove the barriers to entry. Widespread adoption might require a hugely popular game, like Grand Theft Auto 6, to really take off. However, even if that happened, licensing a game like that for cloud streaming – outside of a subscription service like Xbox Game Pass – would likely be very expensive.

After years of testing and improvements, Xbox Cloud Gaming is now officially available! It’s showing a lot of promise with significant upgrades, but it’s still unclear exactly how it will fit into the future of gaming.

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2025-11-03 16:10