Microsoft Corp. this week announced the Xbox Series S, a new console that will play the latest next-generation Xbox games for $299. While it’s less powerful than the $499 Xbox Series X, the lower price point will create a low barrier-to-entry for both core and casual gamers into the Xbox game library and game subscription services.
Microsoft is targeting the Xbox Series S as a high-powered 1440p gaming console with up to 120 frames-per-second fidelity. It utilizes the same 8-Core AMD Zen 2 CPU clocked .2Ghz lower than the Xbox Series X. While the GPU has less compute units, 1/3 the TFLOPS, and less GDDR6 RAM than the Xbox Series X, the company argues that the lower target resolution and development tools like Sampler Feedback Streaming to load only texture data from visible parts of objects, will maintain overall graphics fidelity.
In addition, the Xbox Series S maintains all Xbox Series X next-gen features like hardware-accelerated DirectX ray-tracing, variable rate shading, and Xbox Velocity Architecture using custom 512GB SSD storage.
Early results are promising. Despite the lower hardware specs, Microsoft demonstrated Gears 5 running at 120FPS on the Xbox Series S, while third-party launch titles like DiRT 5 and Yakuza: Like A Dragon run at a 60FPS minimum target.
Despite Microsoft’s graphics push, at $299 most consumers won’t care between 60 and 120FPS or between 1440p and 4K resolution. The sole purchase intent for the Xbox Series S is to be able to play all the latest next-gen Xbox titles. At under $300, it’s an attractive prospect for any gamer, even for owners of rival gaming systems from Sony Corp. and Nintendo Co., Ltd.
Perhaps the most intriguing aspect of the Xbox Series S is its gateway to Xbox Game Pass, a service that allows users to download more than 100 Xbox titles including new first-party releases like Halo: Infinite, for $9.99 per month. As a console without a disc drive, Xbox Series S users have to download all their titles, and Xbox Game Pass is a great way to buy into a full library of new digital games on day one.
If $299 is still prohibitive to the customer, Microsoft is touting Xbox All Access, a financing plan that will include an Xbox Series S and 24-months of Xbox Game Pass Ultimate for $24.99 per month with no interest.
Of course, Microsoft’s new low-cost approach to gaming is to sell games as a service rather than as individual products. Much like Office or Microsoft Teams, Xbox Game Pass is reoccurring monthly revenue that will drive up the bottom line. And the lower the cost of hardware, the more potential subscribers. The strategy is similar to Apple Inc.’s iPhone, which currently includes four different hardware SKUs, yet lead to the same subscription services like Apple TV+, Apple Music, Apple News+, and Apple Arcade.
At the end of the day, the $299 Xbox Series S is a win for the consumer. It allows anyone to enter the next-gen gaming battlefield at launch, even as the least powerful contender.