Microsoft is reportedly preparing an ad-supported Xbox Cloud Gaming tier for 2026, allowing players to stream owned games without a Game Pass subscription while helping the company expand cloud access and offset rising infrastructure costs.
Microsoft is reportedly preparing to expand Xbox Cloud Gaming with a new ad-supported access tier.
As reported by Windows Central, Microsoft is said to be planning to introduce a session-based, ad-supported version of Xbox Cloud Gaming as early as 2026.
The tier would supposedly allow players to stream games they already own digitally without requiring an Xbox Game Pass subscription, instead displaying advertisements during play sessions.
Speculation around ads intensified last week after users noticed a message stating “1 hour of ad-supported play time per session” while launching games via Xbox Cloud Gaming.
While some feared ads were coming to all tiers, sources familiar with Microsoft’s plans have claimed the message appeared prematurely and was tied specifically to the forthcoming ad-supported option, not Game Pass subscribers.
Cloud gaming has become a key pillar of Microsoft’s long-term strategy as traditional hardware sales face mounting pressure.
Rising component costs, driven in part by surging AI demand for DRAM and SSDs, have pushed up prices across consoles and gaming PCs alike.
At the same time, free-to-play titles like Fortnite and Roblox continue to dominate younger audiences, making it harder for premium hardware to maintain momentum.
An ad-supported cloud tier could offer Microsoft a way to offset infrastructure costs while keeping Azure data centres running at high utilisation.
Idle compute is costly, and cloud gaming servers can be repurposed for other workloads, including AI, during quieter periods.
Advertising helps ensure consistent usage while opening the door to new markets.
Xbox Cloud Gaming has already seen double-digit growth, particularly in regions where consoles are prohibitively expensive due to tariffs and taxes.
Microsoft expanded the service to India in late 2025 and is reportedly eyeing further growth across Asia and Africa.
Meanwhile, premium users continue to benefit from upgrades such as higher bitrates and 1440p streaming for Xbox Game Pass Ultimate subscribers.
Xbox Cloud Gaming ‘to get ad-supported access in 2026’
