Xbox boss Asha Sharma rejects a $1.200 console and announces alternative business models to keep the price of the next Xbox generation below the magic $1.000 mark.
Microsoft has drastically lowered expectations for the next console generation. In an interview with the business magazine Fortune Xbox CEO Asha Sharma clarified that the mass market will not spend four-figure sums on hardware.
This is a direct response from management to recent industry reports. These reports quantified the production costs (BOM) of the product codenamed Xbox Project Helix The price of the developed console has risen to as much as $1.200 due to the global storage shortage caused by the AI boom.
Xbox Project Helix: Less than $1.000 for the next-gen
Sharma rejects the arms race for sheer performance supremacy. The industry has reached a point where pure high-performance hardware is no longer economically viable. Xbox will instead utilize new business models and partnerships to subsidize its hardware.
Industry insiders suspect an even stronger integration with the Xbox Game Pass, which is experiencing rising user numbers again after recent price reductions.
The technical specifications of Xbox Project Helix explain the projected peak prices. The next-gen platform, unveiled at GDC 2026, switches to a hybrid architecture closely resembling Windows. The system utilizes a custom AMD SoC based on the Zen 5 CPU and an RDNA 5 graphics unit (AT2 die). The goal is to natively run PC games from the Windows ecosystem directly on the console.
This technological leap requires massive amounts of fast RAM. And that's precisely where the logistical impasse lies. The booming AI industry is buying up the market for high-end memory. Prices for RAM and 3nm wafers aren't stagnating; they're rising. A console that acts as a bridge to the PC absolutely needs these expensive components. Microsoft can no longer reduce hardware costs through sheer volume, as it did in previous generations, by simply lowering component prices. The chip market is preventing that.
Rethinking out of necessity
The change in strategy is the logical consequence of the ongoing hardware dilemma surrounding the Xbox Series X/S. The console division saw a 33 percent drop in hardware sales in the third quarter. A system priced at $1.200 would have no chance in the market, while Sony is presumably pursuing a more traditional, cost-effective console strategy with the PS6.
Sharma's announcement means two things for gamers. First, Microsoft will cross-finance Xbox Project Helix through software restrictions. This has already been confirmed. Comeback of classic platform exclusives Games like “Gears of War: E-Day” or “Clockwork Revolution” serve purely to offset the declining margins of the hardware through store sales and subscriptions.
Secondly, anyone wanting the performance of a PC hybrid system in their living room will henceforth pay the price directly to Microsoft through long-term subscriptions or hardware leasing models. Pure premium hardware without software subsidies is dead in the console sector.
Of course, they would have to cut costs on performance and come up with subscription models.
If you want to get past Sony, you have to be as aggressive as Sony itself, which means selling the devices at a significant loss.
Veit Sachse
With losses? 😄
You don't really believe that, do you? It's usually outdated technology that's being installed there. And that's generally much cheaper.
But not anymore. Now everything has risen incredibly high.
Affordable is a very broad term.
For me, €1000 is affordable. For others, €200. For someone else, €2500.
Their current hardware costs €700, and with massively improved hardware they don't even want €1000? You can't seriously believe that. Improved graphics with AI support (so it's cheaper) cost money. Then there are also improved RAM chips, of course with a higher clock speed. That will also cost significantly more. There are quite a few ridiculous comments coming from the boss lately. First...
The player base has become massively smaller, but by 2030 they will become the absolute market leader in the world, overtaking Steam and Sony.
Then you want to stay under €1000, but the hardware should be better – that's insane again.
Then they reintroduce exclusivity. That wouldn't be so bad, if they hadn't scared away the majority of their player base.
So overall, she has absolutely no clue what she's doing, she just spouts some nonsense.
I still hope the Helix will represent a significant performance leap. I'm prepared to pay €800 to €1000 for that.
Sunny Moreno, hmm… about 20% more power than the PS5 Pro
Definitely not. I don't know where you got that information.
The console will cost 799 / 899 euros here and will only have one version at the beginning.
This millstone around the neck, the Series S, has been holding back the entire development of the Series X for the last 2 to 3 years.
Alex Jung: It doesn't at all. On PC, weaker hardware doesn't bottleneck more powerful hardware. Even GTA 6 is coming to the Series S, and the more powerful consoles aren't bottlenecked there either; that's a misconception.
Then the performance of a 4090 is probably off the table; let's see if Steam really comes to the next Xbox.
Just because she says the console shouldn't cost $1200 doesn't mean it won't cost $1000 or even $999?!
Of course, this part will be extremely expensive…
I'm growing more and more fond of the old lady 😅😅😅
Hmm, the next generation should definitely make a big leap.
But it won't work if inferior hardware is installed to lower the console's price.
Then I can buy a PC too.
Kevin Kleinod
PC 👍🏻
There won't be any bigger leaps forward anyway. And it won't and shouldn't look real.