Netflix and Xbox Discuss Game Pass Subscription Bundle

Netflix and Microsoft have discussed bundling Xbox Game Pass with Netflix into a single subscription offering, according to a report by The Information. Netflix co-CEO Greg Peters has allegedly confirmed they have already “kicked around ideas” about how the two services could be packaged together.

While no formal agreement has been announced, the talks reflect ongoing experimentation with cross-platform subscription models in the entertainment sector. The announcement comes in the backdrop of new Xbox CEO Asha Sharma’s initiatives to make the "future consoles and products like Game Pass more enticing to a broader range of customers."

However, Peters was candid about the internal complexity of any deal. “You would have to do it in a way that works for the consumer and works for both companies,” he stated. According to him, Microsoft is still figuring out different ways to make the Game Pass bundle work for the company.

In Q4 of Fiscal Year 2025, the company reported that Game Pass, with an annual revenue of  $5 billion USD, accounted for 20% of Microsoft’s gaming revenue. However, in October 2025, Microsoft raised Game Pass Ultimate's price by 50% to $29.99 per month, a move that triggered significant subscriber backlash, mostly across the price-sensitive markets.

Sharma, who replaced previous Xbox CEO Phil Spencer in early 2026, has been taking an approach of questioning what more can be done with Xbox and Game Pass. The first thing she did was to dissolve Microsoft’s "This Is An Xbox" campaign. Reports also surfaced about an ad-based Game Pass tier, which could come with a significant price reduction or even be entirely free.

Peters also offered an observation on the management transition at Xbox, noting that Sharma’s approach has been “exciting to watch.”

Netflix and Xbox Bundling Strategy Reflects Gaming Push

The discussion comes as Netflix pushes deeper into gaming through mobile titles and interactive content. The streaming giant, with more than 300M global subscribers, has spent over $1B acquiring gaming studios, and now offers more than 120 gaming titles for subscribers.

Despite the offering, user activity for gaming remained really low, with only 0.5% total user engagement. Combining Netflix’s game offerings with Xbox Game Pass could create a value-driven offering aimed at consolidating entertainment spending under a single subscription.

Companies such as Amazon and Apple have already adopted bundled ecosystems, through Prime and Apple One, respectively, to deepen user engagement. However, as Peters mentions, challenges remain with pricing and tiered models. Now it remains to be seen how both companies tackle the challenges and whether the combined subscription model can finally drive more engagement for Netflix Gaming.