Xbox chief executive Asha Sharma says the gaming giant needs to be "thinking about" affordability for its next-generation console, amid a "crisis" in computing prices.
In an interview with the BBC, she said rising hardware costs partly driven by AI spending mean firms need to find ways to make gaming affordable.
She also revealed gamers will soon be able to get digital versions of many of the physical games they currently own, potentially meaning their old games can be played on future Xbox consoles without having to put a disc in a drive.
"I know players love physical media, and I know there's a lot of benefits in digital media, and I want to make sure people have a choice," Sharma said.
Currently, digital games can be downloaded online and played across Xbox consoles or PCs.
But some players prefer discs, with one of the main benefits being they can be bought and sold second-hand.
The topic has proven controversial, with Sony announcing new PlayStation games will no longer be released on discs from January 2028, and the hotly-anticipated Grand Theft Auto VI similarly launching without a physical disc.
"There are stacks of games on everybody's shelves," Sharma said.
"We're announcing the ability for players for 1,000 titles with physical discs to be able to have a digital entitlement."
If a disc is sold second-hand, the digital rights would transfer over to the new owner.
Players will be able to access the feature by inserting one of the supported games into their Xbox console. And Sharma hinted it meant gamers would be able to play their old titles on future hardware.
"We've long pioneered backwards compatibility and so you'll continue to see that as we go forward in the generations," she said.
But she would not reveal whether Xbox's next-generation console - currently codenamed Project Helix - will have a disc drive at all.
"This next generation, we have to be thinking about efficiency and affordability alongside performance," she added.
For the first time in the history of gaming, consoles across the board have seen price hikes years after they came out.
This is partly due to component costs such as Ram skyrocketing in price as AI companies buy up all the parts for their data centres.
"As an industry, we're in the middle of 'Rampocalypse'," Sharma said.
"All of the industry needs to start to innovate on affordability and efficiency. That is something that we have not had to do [previously].
"But with the crisis that's currently happening in hardware and components, it is absolutely something all of us need to be thinking about and innovating on and giving people more choice in terms of how they play their console and how they purchase their console."
Xbox is part of Microsoft, which is one of the companies ploughing the most money into AI infrastructure, which in turn puts the prices of hardware components up.
"AI is fundamentally changing a lot of things," Sharma said.
"Our job as Xbox, as we continue on in our next generation, is to take into consideration what's happening in the world and build the best experience for our players."
That meant, she said, for the next generation of consoles, Xbox had to think about "hardware efficiency in terms of how you use storage and memory, the kind of price per unit, the components, things like that".
