Xbox testing ad-supported streaming, Amazon brings Luna to Prime Video
Microsoft’s Xbox CEO Asha Sharma speaks at the Bloomberg Tech conference in San Francisco on June 4, 2026.
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Amazon And Microsoft We’ve developed new ways to enable people to play video games in the cloud.
Microsoft’s Xbox division said Thursday it will test an ad-supported method that lets people stream video games.
AmazonMeanwhile, it announced plans to add Luna cloud game It serves the Prime Video streaming platform. Amazon includes Prime Video in its $14.99 monthly Prime subscriptions. Amazon’s arrangement will give Luna more prominent exposure on its website. Previously, Luna could only be accessed through a dedicated website.
The two companies have had success with cloud computing but stumbled because they tried to get people addicted to games over sometimes unreliable internet connections, which can cause lag.
“Our goal is simple. To give more people more affordable ways to play,” Xbox wrote in a blog post.
Microsoft started selling the first Xbox console in 2001. Today, Xbox is falling behind Nintendo’s And sony In console sales. The subsidiary is trying to return to growth and expand margins after spending $75.4 billion on Call of Duty publisher Activision Blizzard in 2023.
Since then Meta executive Asha Sharma replaced Phil Spencer as Xbox CEO in February, appointing new leaders, teasing an upcoming console, pushing for exclusive games and slashing subscription prices. This month, it announced a 20% reduction in force and said Xbox would bring on board four development studios.
Xbox has struggled with advertising in the past, and customers haven’t always been fans. One person in 2024 reported about one McDonald’s The ad that appears on the screen to choose a game. Publishers Electronic Arts And Take-Two Interactive I experimented with ads and quickly He backed down in response. criticism.
“Advertising has been around in gaming for decades, from in-game placements to free-to-play models,” Xbox said in its post. “But it’s not always designed with the player in mind. When ads are done well, they can help reduce the cost of reach.”
Players participating in the Xbox Insider Program can participate in testing with a one-hour session limit. Applies to games already in the user’s library.
Xbox hasn’t built an ad-inclusive layer of its Game Pass subscription service, but consumers have shown interest in such offerings. netflixAccording to CNBC’s report in 2024, the ad-supported service layer reached tens of millions of users.
Amazon entered the cloud gaming market during the Covid pandemic, as games gained popularity as people spent more time at home. The digital commerce company launched Luna in 2020, three years after Microsoft introduced Game Pass and a year after its cloud rival. Google has unveiled its own cloud streaming option, Stadia.
Google stopped Stadia in 2023. With Luna, users can play games on smartphones and standard computers without purchasing a console or dedicated gaming PC.
By integrating Luna into Prime Video, the digital commerce company is doubling down on its effort to attract casual gamers with party games and well-known intellectual properties like “Harry Potter” and “Tomb Raider.” Amazon’s head of gaming, Jeff Gattis, said in an interview with CNBC that the company’s goal is not to attract hardcore gamers or compete with console manufacturers.
The unit, which Amazon recently reorganized to combine Luna and its game studios, has struggled to achieve major success, faced executive turnover and faced several layoffs. Amazon recently shut down or removed several of its games, including its massively multiplayer online games “New World” and the planned “Lord of the Rings” project.
Gattis said Luna has “millions” of users in the U.S. and 13 other countries and has a goal of reaching 10 million to 20 million “as quickly as possible.”
In a market where PlayStation, Xbox, Epic Games and Steam are “fighting each other,” Gattis said players are “well served, if not overly.” He said there is a strong segment of consumers who want to play games but do not want to invest in increasingly expensive hardware and software.
Gattis said Amazon is working to address the awareness gap among consumers who may not know or understand the gaming strategy.
“I always say people don’t have to like or agree with our strategy, but it’s important,” he said. “I hope they understand that.”
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