- Even if the feds pass a sweeping national framework, like the proposed SELF DRIVE Act, cities and states would still keep their authority over local road usage. In other words, cities are going to be the main arbiters of robotaxi permission for the foreseeable future.
- Texas may be the Wild West, with fewer rules governing self-driving cars than most states, but California is still the gold standard. Securing a deployment permit from the California Public Utilities Commission, for example, is viewed by the industry as a definitive safety validation.
Tech
Cities want to put the boot on robotaxis
Reading in data-saving mode. Read full article from The Verge website.
Published 10/18/2026 7:00:00 AM
Cities want to put the boot on robotaxis
Cities want to put the boot on robotaxis
Frustrated by federal gridlock, cities and states across the political spectrum are taking matters into their own hands to rein in autonomous vehicles.
Cities want to put the boot on robotaxis
Frustrated by federal gridlock, cities and states across the political spectrum are taking matters into their own hands to rein in autonomous vehicles.
is transportation editor with 10+ years of experience who covers EVs, public transportation, and aviation. His work has appeared in The New York Daily News and City & State.
This is The Stepback, a weekly newsletter breaking down one essential story from the tech world. For more on autonomous vehicles, policy, and road rules, follow Andrew J. Hawkins. The Stepback arrives in our subscribers’ inboxes at 8AM ET. Opt in for The Stepbackhere.
How it started
The first state to pass a law legalizing self-driving cars operating on public roads was Nevada in June 2011 — long before such vehicles were operating on public roads. This was three years before the introduction of Tesla’s Autopilot, five years before Waymo spun out of the Google self-driving car project, and seven years before the first commercial robotaxi service got underway (in Arizona, not Nevada). Nevada was ahead of the curve primarily due to lobbying: Google saw Nevada as prime testing ground for its prototypes, so it urged lawmakers to pass the law that allowed it to do so. The legislation even included a provision exempting drivers from text-messaging bans while the automated system was engaged.
Back then, many states and cities welcomed self-driving cars with open arms, eager to be seen as future-forward and pro-innovation. They had no inkling that over a decade later, they would be back at the drafting table crafting legislation to rein in these same self-driving cars.
While federal regulators scramble to establish safety standards, legislation that would establish rules for autonomous vehicles remains stalled in Congress — and has been for years. Washington’s paralysis has left local lawmakers to create their own playbooks to ensure robot cars at least follow some rules of the road.
The result is a patchwork of rules and regulations for robotaxi operators to follow — an outcome that many industry leaders were desperate to avoid. And as robotaxis continue to spread to new cities, local officials are discovering more unintended consequences of their new robot residents, leading to even more rules and an ever-growing patchwork of complexity for operators.
How it’s going
Municipalities generally lack authority over vehicle manufacturing standards, but they hold broad authority over street operations. As such, they’ve been using that authority to pass their own laws governing the rollout of robotaxis. There’s not an exact count of the number of local regulations and ordinances that have been passed since robotaxis have gone mainstream. But in the absence of any federal rules, cities and states have been flexing their authority in an effort to bring order to some of the chaos.
Minneapolis is considering an ordinance to require human monitors inside autonomous vehicles, which would effectively ban driverless operations. The San Diego City Council passed a resolution seeking to block Waymo from the airport and give local agencies direct control over AVs in emergencies. And Austin firefighters have expressed concern over the Tesla Cybercab’s lack of steering wheel or pedals, which they argue could lead to issues if first responders need to move a stalled vehicle. They want to require AV developers to establish dedicated, rapid-response towing protocols and direct human operator communications for emergency situations.
It’s not just cities or blue states taking a harder line, either — the pushback is blurring traditional political lines. It used to be the case that Republicans were seen as more welcoming of autonomous vehicles, while Democrats were seen as more skeptical. This has certainly borne out in a handful of Democrat-led cities — New York City, Chicago, Washington, DC — that still haven’t legalized driverless cars. But now even some red states are considering tightening the leash, including Kentucky, Oklahoma, South Dakota, and Iowa.
Even in tech-friendly California, state lawmakers are mulling ways to bring robotaxis to heel. Several bills have been introduced to give cities direct authority to limit AV fleet sizes, restrict operating hours, or enact local permit bans within municipal limits. Additionally, emergency protocols were drafted to require AV companies to give local police and fire departments physical override access or emergency remote shut-off mechanisms.
Some municipalities are flexing their land-use and zoning powers to crack down on robot cars. Culver City explored emergency moratoriums on building permits for AV fleet facilities, while Santa Monica used local noise and traffic ordinances to restrict 24-hour charging hubs. It would seem that even robotaxis aren’t immune to NIMBY complaints.
What happens next
As the local debate over autonomous vehicles intensifies, AV developers are increasingly looking overseas as a potential hedge to more obstacles in cropping up in the US. Waymo is planning to expand its service in London, Tokyo, and Munich. Uber is teeing up vehicles for Manchester, Madrid, and Dubai. If the US is getting too complex and over-regulated, perhaps they can find friendlier reception elsewhere.
Still, the US presents the industry’s best chances of turning a profit, especially as costs for developers continue to grow. Rather than fighting strict local regulations head-on, companies like Waymo, Zoox, and Aurora are prioritizing states with explicit legislative preemption that prevents individual cities from banning the technology. And at the national level, industry trade groups like the Autonomous Vehicle Industry Association are aggressively pushing for more preemption powers in an attempt to create more unified standards.
Congress may eventually get around to passing high-level safety legislation, but it’s highly unlikely that any bill passed at the federal level would seek to strip cities of their core police, zoning, and emergency response powers. States will also have a say, and sometimes that may complement or conflict with their own cities. Even airport authorities are getting in on the action, proposing their own slate of rules for robotaxis. AV companies would be well advised to get used to the patchwork — it’s not going anywhere.
By the way
Read this
- Streetsblog reports that Uber and Waymo have spent more than $15 million on lobbying state officials in New York.
- Tesla had to change the name of its Full Self-Driving software to “Assisted Driving” to win approval from European Union regulators, Reuters reports.
- Tesla provided first responders in Austin three days of training and emergency guidebooks on how to interact with its Cybercabs, according to The Daily Texan.
Follow topics and authors from this story to see more like this in your personalized homepage feed and to receive email updates.
§
Didn’t Microsoft say the next Xbox needed to be affordable?
Didn’t Microsoft say the next Xbox needed to be affordable?
is a senior editor and founding member of The Verge who covers gadgets, games, and toys. He spent 15 years editing the likes of CNET, Gizmodo, and Engadget.
Fortune dropped a bombshell report on the future of gaming this week. According to the publication’s Microsoft insiders, the next Xbox is projected to cost between $1,200 and $1,800 when it arrives in 2028.
My first reaction: The next Xbox is dead on arrival. It’s DOA.
My second thought: Microsoft knows people won’t pay that much. It couldn’t possibly charge that much money if it wants next gen to be a success. “I wouldn’t release it at all,” former Microsoft exec Mike Ybarra recently said.
My third thought: Didn’t Microsoft alreadysay out loud that it knows people won’t pay that much?
- Didn’t old Xbox boss Phil Spencer say “We’re not going to grow the market with $1,000 consoles”?
- Didn’t new Xbox boss Asha Sharma say “We’ve reached a point where it will be hard to imagine that mass audiences can afford thousands of dollars to spend” on a box?
- Didn’t Xbox chief strategy officer Matthew Ball say the entire company would change its practices to make sure it’s affordable?
- Didn’t Sharma say Xbox would need to adopt “radically different business models” to keep Xbox from being too pricey?
Did Fortune get it wrong?
I don’t think Fortune’s insiders are the problem here. With today’s incredibly overpriced RAM and storage, it wouldn’t be surprising if it cost over a thousand dollars to build, package, distribute, and sell “the largest technical leap you will have ever seen in a hardware generation,” as former Xbox president Sarah Bond called the next Xbox back in 2024.
But there are at least five ways the report could be correct without making you pay all that money at once. I just don’t think you’re going to like most of them.
Subsidies: Microsoft could pay to give you a discount
The least-likely possibility is the one Fortune suggests itself. Let’s look at the original quote, bolding mine:
[…] the price of the Helix console has internally been projected to cost consumers between $1,200 and $1,800, unless Microsoft decides to subsidize the cost.
Historically, Microsoft has subsidized the Xbox. Microsoft sold boxes at a loss right out of the gate, making its profits when you buy games and Xbox Game Pass subscriptions instead of on the hardware alone. That’s not our speculation — it’s exactly what Microsoft told The Verge in 2021. In 2023, we learned that Microsoft may have spent $1.5 billion to make sure it could sell the Xbox Series X and S at $499 and $299 respectively, instead of what they actually cost.
But Microsoft has suggested that it’s done with hardware subsidies. “Going forward, this cannot continue,” wrote Sharma in her “Xbox reset” memo, referring to the $20 billion in content, platform, and hardware subsidies Microsoft made over the past five years.
Microsoft CEO Satya Nadella echoed that idea on the Hard Fork podcast: “No one can accuse Microsoft of not having invested for the last 25 years, and now we have to turn this into a sustainable business.”
It isn’t just new management that’s hinting at no more subsidies: Bond primed the pump for a $1,000 box when she called Helix “a very premium, very high-end curated experience” late last year, comparing it to gaming PCs like the $1,000 Xbox Ally X handheld.
Perhaps Microsoft has changed its mind since then. “We are working very hard to rethink everything that we can about Helix,” Ball said in June, referring to affordability. “The plan’s the plan until it’s not the plan,” Sharma said in February (though not about affordability specifically).
But subsidies would be a tremendous risk if the Helix still plays PC games in addition to Xbox ones. Valve’s Steam is by far the dominant PC gaming platform — so PC gamers who buy a Helix won’t help Microsoft recoup its money.
Subscription: “Get it free with 36 months of Xbox Game Pass and qualifying trade-in”
There’s another way Microsoft could subsidize a $1,200 Xbox.
Today, AT&T will give you a $1,200 iPhone 18 Pro for $0* — if you lock yourself into 36 months of AT&T phone service that costs $100 or more per month and trade in a recent phone, too.
Microsoft could do the same with a new, pricier tier of its Xbox Game Pass game subscription service, effectively bundling the games with the console and making you slowly pay for both at the same time. Perhaps you’ll have the option to buy an “unlocked” Xbox for full price, but it won’t be the norm.
To make it happen directly, Microsoft would need a pricier new tier of Xbox Game Pass, which wouldn’t necessarily align with the company’s recent moves. Sharma actually cut the price of Game Pass Ultimate to $22.99 a month in April, writing that “Game Pass has become too expensive for players,” while removing Call of Duty games and unlimited access to Xbox Cloud Gaming from the deal.
I don’t know if it would work. People feel naked leaving the house without phone service. They might not feel the same about games. Subscription fatigue is real. But if it worked, Microsoft’s moat would be stronger than ever. You’ll be more likely to play the games you’ve already paid for and are committed to keep paying for. Many would get sucked into a profitable upgrade cycle, just like they do with phones, since they can buy the next Xbox for “$0” as soon as it comes out.
Cellphone subsidies have been around nearly as long as pricey phones: The 1994 IBM Simon, arguably the first smartphone, eventually cost half its $1,100 price tag if you signed a contract with BellSouth. My first phone, a Kyocera QCP-6035 with a built-in PalmPilot, was subsidized when it arrived in 2001. So it’s not exactly a “radical new business model,” but it would be new for game consoles.
Rental: Maybe most people won’t own a Helix themselves
It’s also possible that Microsoft simply doesn’t plan to sell a console to the masses anymore — it can sell an $1,800 Xbox to those who can afford “video game ownership” and try to hook everyone else on the Netflix model.
After all, the “K-shaped economy” and RAMageddon have already made gaming PCs and existing game consoles into luxury goods. Society’s wealthier individuals seem perfectly happy to pay inflated prices for the few consoles Sony and Microsoft still pump out.
While PS5 sales plummeted after Sony’s price hikes, that may have been about component shortages rather than decreased demand. Xbox sales reportedly rose over a similar period, and Microsoft has justified repeated, dramatic price hikes on its consoles since May 2025.
“I can tell you definitively, demand for our console exceeds supply. We are putting them in as many stores as possible, we are producing them as quickly as possible. There is a severe limitation to how quickly we can do that,” Xbox chief strategy officer Matthew Ball told The Game Business in June, blaming RAM shortages.
But Microsoft has another way of giving less affluent people access to “next-gen” Xbox power. It can rent you one. The company just launched pay-as-you-go cloud gaming starting at $3.99 for 10 hours of cloud gaming (50 hours for $11.99).
Maybe all of Microsoft’s recent talk about affordability isn’t about the masses owning a next-gen console. Maybe it’s about finding an affordable way for people to “play Xbox” without owning the games at all.
The next gen is the current gen
After Fortune’s report, some of the very first reactions I saw boiled down to this: “I’m out. Forget next gen, I’m going to stick with my existing Xbox/PlayStation/Switch.”
That’ll be the reality for many people if the Xbox costs over a thousand bucks. But if the RAM shortage continues — if Microsoft knows it’ll sell every Xbox it can make to wealthy individuals because it can’t make a lot — it’s not necessarily a huge risk to sell it sky-high on day one.
Perhaps the Xbox Helix will be an early adopter console, the same way the iPhone Duo is an early adopter phone, the same way the Steam Frame is an early adopter headset. These products are selling out instantly despite their high price tags, leaving many would-be buyers in the cold. They’re shipping messy and unfinished, but that’s okay because early adopters want to come along for the ride.
Microsoft knows the same is true of some Xbox buyers, because it helped ship an unfinished $1,000 Xbox Ally X handheld even before the RAM crisis, and the $1,300 Xbox Ally X20 follow-up is already sold out.
But if Microsoft splits the Xbox audience into “have” and “have-not,” it means the next generation won’t truly arrive. Game developers won’t spend all their effort targeting a console people can’t buy. The next Xbox won’t be any more necessary than a PS5 Pro if you already own a PS5. In industry lingo, the Helix would be a “mid-cycle refresh” instead of true next gen.
I wouldn’t hate that, though, and neither would many video game execs. They’ve long complained that the pace of technology has ballooned the cost of building a video game to unsustainable levels, leading to today’s world where too many development teams are cut to the bone right after their games ship.
Former PlayStation and Xbox execs like Shuhei Yoshida, Shawn Layden, and Mike Ybarra have argued that the next gen isn’t necessary.
“Stick with PS5 Pro/Series X until prices normalize. The capabilities of those boxes are both fine for 99% of the audience. No one is screaming ‘I need a more powerful console’ right now,” Ybarra tweeted on October 20th.
“I think [Sony and Nintendo] should try to keep the current generation as long as possible, because I think people are very happy using PS5 and Switch 2,” Yoshida told me on The Vergecast.
“I think we’ve plateaued on the tech, frankly,” Layden told GamesIndustry.biz in 2025. (He’s said similar before and since.) “Make it cheaper and simpler. Let’s do that instead. And let’s find a way to have more hardware companies participate.”
Microsoft and its chip partner AMD have already taken one step to help extend the current generation — AMD’s performance-enhancing FSR 4.1 is coming to Xbox Series S and X, which should make it easier for both to deliver crisp 4K images to your TV.
Pay what you can afford
Even if Microsoft ships a $1,800 console, the company’s been clear it won’t be the only Xbox you can buy. Sharma has publicly said that Helix will be a “family of devices,” which has been broadly interpreted to mean that Microsoft will let PC industry partners like Asus sell their own “Xbox” as well.
If the reporting pans out, that wouldn’t just be a cobranded Xbox Ally handheld that runs Windows — Asus could make a console-shaped box that runs a Windows-based Xbox OS, too.
Some of those partners could offer more affordable, less powerful Xboxes than Microsoft’s own flagship box, perhaps with less storage and memory. Microsoft, too, might have creative solutions for storage, like how the company shipped the Xbox 360 with different-size hard drives, or none at all, to make it more affordable. “We will have to empower customers to have very flexible storage offerings,” Sharma said in June.
Or you could buy another Xbox that’s likely going to continue to count as part of Microsoft’s “family”: the existing Xbox Series X and Xbox Series S.
This can all work because games don’t need to target a single console anymore; they haven’t needed to for a long time. An Xbox One game runs on an Xbox One X and an Xbox Series S and an Xbox Series X because they’re all effectively AMD-powered Windows PCs, just with different amounts of performance on tap. The Xbox Helix is a powerful extension of the same continuum. The same is true of PlayStation 4, PS4 Pro, PS5, PS5 Pro, and presumably PS6, minus the Windows part.
Perhaps a particular piece of hardware will stand out as the one developers should target as the baseline for “it looks and runs great on Xbox,” the same way the Steam Deck handheld became a baseline for PC game developers starting in 2022. Maybe, like the Steam Deck and the Nintendo Switch, it’ll help reset our expectations of what a top-shelf game needs to look like.
At this rate, I wouldn’t be surprised if the existing Xbox Series S will be the one. But it could also be Microsoft’s own next handheld Xbox. Fortune’s insiders say it’s coming holiday 2027.
Follow topics and authors from this story to see more like this in your personalized homepage feed and to receive email updates.
