The error with GamePass, is that it could only be viable with a MUCH bigger subscriber base than they were ever going to get, in order to break even.
Microsoft mistakenly thought that they can convince people to subscribe if it was "cheap enough".
But they missed the boat, because League of Legends in 2009 created the monster that was "free to play". Free To Pay became the most broad and popular way for non-gamers AND gamers alike to play games. And no matter how cheap GamePass is made to be, they will never be cheaper than FREE. And GamePass will never have the likes of Fortnite as a part of its portfolio, the math just doesn't work.
GamePass is an old idea that doesn't work in the modern era. There are still people who would pay for it, but not enough of them to actually sustain it. Free-To-Play basically ate GamePass's lunch.