Microsoft is finally stepping into the handheld gaming arena with the launch of its first officially branded devices, the Xbox Ally and Xbox Ally X. After weeks of speculation, the company has confirmed prices, with the base model starting at $600 and the premium Ally X climbing to $1,000. Set to release on October 16, 2025, both handhelds aim to challenge Valve’s Steam Deck and other PC-based competitors.
But with tariffs driving up hardware costs and gamers already facing expensive consoles, the big question remains are these new Xbox handhelds worth the investment? Early impressions highlight comfort and familiar design, but performance and pricing could make or break Microsoft’s long-awaited entry into portable PC gaming.
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Preorders and Base Pricing
Preorders for the Xbox Ally opened on September 25. Microsoft confirmed that the standard Xbox Ally will retail for $600, while the high-end Xbox Ally X will cost a hefty $1,000.
This announcement ended weeks of speculation, but it also highlighted the ongoing challenges in pricing gaming hardware. While the Ally competes directly with Valve’s $550 Steam Deck OLED, it lacks an OLED screen, opting instead for a 7-inch IPS LCD.
Xbox Ally: Entry-Level Specs and Design
The base Xbox Ally comes with the following core specifications:
- Processor: AMD Ryzen Z2A
- RAM: 16GB
- Battery: 60Wh
- Display: 7-inch IPS LCD
- Price: $600
Performance-wise, early benchmarks suggest parity with the Steam Deck OLED, though it may fall short in display quality. Ergonomically, however, Microsoft has taken a different approach. The Ally’s design leans heavily into Xbox controller-style grips, offering more comfort compared to Valve’s somewhat bulkier Deck.
This design choice suggests Microsoft wants the handheld to feel instantly familiar to Xbox fans—essentially a controller with a screen.
Xbox Ally X: The Premium Model
If the base Ally is Microsoft’s entry ticket, the Xbox Ally X is its luxury offering. At $1,000, it doubles down on specs and tries to justify its steep price tag with hardware upgrades:
- Processor: AMD Ryzen Z2 Extreme (new SoC designed for handheld PCs)
- RAM: 24GB
- Storage: 1TB SSD
- Battery: 80Wh
- Price: $1,000
This darker-themed model promises better performance, particularly at lower power settings where efficiency could help sustain stable frame rates. However, questions remain about whether its raw power leap is enough to justify nearly double the price of the Steam Deck OLED.
The Ally X will be available exclusively through Best Buy, adding scarcity to its already premium positioning.
Tariffs and the Rising Cost of Gaming Hardware
No conversation about Xbox pricing is complete without addressing the elephant in the room: tariffs.
Recently, the U.S. government imposed new tariffs on gaming and PC hardware, pushing manufacturers to hike prices across the board. Microsoft already increased the price of the Xbox Series S and X consoles, with the disc-drive-equipped model now selling for $650 and the 2TB Galaxy Black version for $800.
The ripple effects extend beyond consoles:
- Asus raised the price of its Ally X by $100, now starting at $900.
- Lenovo hiked the Legion Go S from $550 to $650.
- The Legion Go 2, featuring an OLED display and Ryzen Z2 Extreme, now begins at $1,350.
This market trend means gamers will increasingly pay more for incremental hardware upgrades.
Competing With Valve’s Steam Deck
Valve’s Steam Deck remains the dominant force in handheld PC gaming. Despite being a few years old, it retains a strong edge thanks to:
- SteamOS: A streamlined, console-like operating system designed for gaming.
- Community Support: A vast developer and modding community keeping it optimized.
- Price Advantage: Even with tariffs, Valve has yet to hike prices as steeply as competitors.
While the Xbox Ally promises a handheld-optimized version of Windows 11, Microsoft’s OS has historically been clunky on portable devices. Fixes for sleep mode and background task issues are promising, but SteamOS still feels more polished.
Hands-On Impressions: Comfort vs. Performance
Early hands-on previews highlight one standout feature: comfort. The Xbox Ally feels closer to holding a traditional Xbox controller, making extended sessions more enjoyable. However, comfort alone doesn’t solve the looming question of value.
Performance metrics remain uncertain, and while the Ally X looks powerful on paper, early leaks suggest its real-world advantage may be modest compared to last-gen handheld PCs. The real differentiator could be Microsoft’s new Windows 11 build, designed specifically for handheld gaming.
The State of the Handheld PC Market
Microsoft isn’t alone in chasing this segment. The last two years have seen an explosion of handheld PCs, including:
- Valve Steam Deck
- Asus ROG Ally series
- Lenovo Legion Go
- Ayaneo devices
What unites them all is rising costs. Just three years ago, portable PCs under $600 were common. Today, mid-tier models sit around $700–$900, with premium options hitting well over $1,000.
Frequently Asked Questions (FAQs)
When will the Xbox Ally and Ally X launch?
Both handhelds will launch on October 16, 2025.
How much does the Xbox Ally cost?
The standard Xbox Ally is priced at $600.
How much does the Xbox Ally X cost?
The premium Xbox Ally X costs $1,000 and is available exclusively through Best Buy.
How does the Xbox Ally compare to the Steam Deck?
The Steam Deck OLED is cheaper ($550), has a better display, and benefits from SteamOS optimizations, while the Ally leans on a more familiar Xbox-style design and runs a handheld-optimized Windows 11.
Will tariffs affect the Xbox Ally’s price?
Yes. Like the Xbox consoles, tariffs could raise prices after launch, making early adoption the cheapest option.
Can I play all Xbox games on the Ally?
Yes, the Ally runs Windows 11, so you can play Xbox Game Pass titles, PC games, and use multiple platforms (Steam, Epic, etc.).
Is the Xbox Ally X worth $1,000?
It depends. The Ally X offers better specs, but early leaks suggest only modest performance gains. Gamers may get more value from a Steam Deck OLED or waiting for Valve’s next handheld.
Conclusion
The Xbox Ally and Ally X bring Microsoft into a competitive, crowded market at a difficult time. On one hand, the devices promise comfort, familiar design, and Windows integration. On the other hand, pricing and tariffs make them harder to recommend over Valve’s more affordable Steam Deck. For Xbox loyalists, the handheld may be worth picking up at launch before further price hikes. For everyone else, the Steam Deck remains the safer