$100 Subsidized Xbox 360 Coming?


TheVerge is reporting that Microsoft is planning to launch a 4GB Xbox 360 + Kinect + Xbox Live Gold bundle as soon as next week that’s just $100. The catch? Taking a page from mobile and cable providers, Xbox wants you to sign up for a $15/month subscription.

Is this the future of console gaming? No longer buying a console outright, but instead subsidizing the costs with a low purchase price and a monthly subscription contract?

No doubt seeing the success that mobile carriers like AT&T and Verizon, along with cable providers like Time Warner, Comcast, and DirecTV, have enjoyed with monthly subscription plans, Microsoft is looking to get in on the action. Their proposed $15 monthly fee would include a two-year contract, a two-year warranty, full Xbox Live Gold service access, and maybe some kind of streaming TV content from Microsoft’s cable partners and/or sports package providers. Backing out of the deal before your 2-year agreement is complete will incur a penalty fee.

On the plus side: you’ll be getting the sexier “Xbox Slim” model that was first unveiled a couple of years ago. That’s mighty enticing for newbies as well as original-flavor Xbox 360 owners who still have to deal with a noisy machine, no built-in wifi, and the Red Ring of Death. You’ll also get your very own Kinect, which is pretty darn exciting, because that $100 price tag for the entire bundle (not counting the monthly fee) is $50 less than just the Kinect sensor itself currently costs. A Gold account is always a big bonus as well, particularly for multiplayer gamers.

But on the downside: you’re paying more in the long run. A standard 4GB Xbox 360 with Kinect bundled in sells for a MSRP of $299. Xbox Live Gold accounts are $5 a month, so for 24 months, that’s $120. $299 + $120 = $419. By contrast, with this proposed monthly plan you’d pay $100 for the hardware + $360 for two years of the monthly fee = $460. It’s about $40 more in the end, but on the other hand, spreading out the payments this way is something that many people will have a much easier time coming up with.

What’s really provocative about this whole thing is what it could mean for Microsoft’s third-generation Xbox. For example, would Microsoft consider upgrading your current system with their next-gen system when it comes out? Even if there’s an upgrade fee of $100 or something, it could be considerably cheaper than purchasing the new console flat out.

It should be interesting to see how this plays out. It’s still considered hearsay at this point, but TheVerge is usually very reliable. Microsoft is playing their usual “no comment on rumors or speculation” card, at least for now.


  1. says

    Many people i speak with are fed up with mobile carriers’ contract plans, cancellation fees, and so forth. Likewise, many are going to services like Hulu & Netflix to avoid the rising cost of cable.

    I find it hard to see Microsoft’s potential mimicking of the subsidized hardward/monthly fee/cancellation fee business model to be a good thing.

    Rather, i see it as yet another example of the industry not having consumers’ interests at heart while at the same time encouraging exactly what they don’t want: piracy and emulation.

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