Will Microsoft Ditch Steam to Protect Game Pass Profits?

Microsoft is radically rethinking its PC gaming strategy ahead of a massive business reset planned for 2026. According to recent industry whispers, these internal evaluations could theoretically provide the Xbox division with a viable way to walk away from Valve's Steam platform. However, PC gamers can breathe a sigh of relief for now; actually abandoning the biggest storefront in PC gaming would mean leaving a mountain of guaranteed money on the table, making a full exit highly unlikely.

The speculation gained traction following comments from Windows Central reporter Jez Corden on a recent episode of the Xbox Two Podcast. Corden shared that Microsoft has closely guarded, undisclosed plans regarding how the company shows up in the PC space. "The plans that I know about, and I’m being very careful here, kind of suggest it gives them a window to potentially pull out of Steam," Corden said, noting he wouldn't be shocked if an Xbox universe without Steam eventually comes to pass. 

He later clarified on social media that having the window doesn't mean Microsoft will take it. "I REALLY doubt they will, but they're doing something that could potentially give them a window to do so, but there's just too much money to be left on the table," Corden explained.

This potential ecosystem shake-up is deeply tied to Microsoft’s next-generation hardware plans, known as Project Helix. Designed to bridge the gap between traditional console setups and enthusiast PC gaming, Project Helix is expected to be significantly expensive to manufacture due to its costly Magnus APU. Because the system will likely cost more to produce than the PlayStation 6, Microsoft is searching for ways to protect its software profit margins. 

Protecting Game Pass Profits on Next-Gen Hardware

If Xbox allows third-party storefronts like Steam, GOG, or the Epic Games Store onto the new device, those platforms will take their standard 30% cut of game sales. Keeping players in the native Xbox Store and Game Pass ecosystem would allow Microsoft to claim that full cut, helping them subsidize the expensive hardware and release it at a lower price point, as per Wccftech. 

These strategic evaluations arrive during a remarkably turbulent transition period for the gaming giant. Following the massive studio acquisition spree spearheaded by former Xbox head Phil Spencer, the company is now navigating a challenging business reset under current Xbox CEO Asha Sharma. This difficult phase has already led to multiple waves of layoffs, studio closures, and a radical shift in how the business operates to survive tough market conditions.

Compounding these struggles is a severe, industry-wide memory shortage that is driving up the prices of crucial PC components, especially RAM and NAND storage. With component prices continuing to climb and the situation predicted to worsen in the coming months, Microsoft is highly motivated to strengthen its own direct-to-consumer storefronts. 

While pulling first-party games off Steam would be a drastic move that would require convincing a massive user base to switch platforms, the rising costs of gaming hardware make it easy to understand why Xbox executives are at least evaluating the option behind closed doors.