Everyday there is a new gaming related rumor floating around the internet. Sometimes these rumors are rather valid and come true, and other times they are just banter from wrestling belt wearing youtubers….. Today word got out that Microsoft will be introducing a subsidized Xbox 360 for $99 plus a monthly fee with a 2-year contract. A pricing scheme we in America associate with cell phone carriers. The rumored deal would cost gamers $99 upfront, where they will receive a 4gb Xbox 360 with Kinect, they will also get 2 years of Xbox Live Gold and possibly a two-year warranty, it’s also rumored that you would receive special streaming media as well (more than likely the free stuff already offered and free stuff that is coming down the road from third parties). Once you leave the store you’ll be charged a $15 a month fee for two years. Your grand total after two years would be roughly $459. Now if you purchase this outright you’d be spending about $499, that’s including the 2 year $50 xbox warranty and 2 year $30 Kinect warranty. So as you can see you will be saving yourself about $40, that’s not to bad.
So the question is why are they doing this? Xbox sales are still strong. Each month they keep out-selling the competition. But the thing is there is little money in selling consoles. Where the money lies is in the games, but more so in the digital content. This is smart on Microsoft’s part, get more consoles into homes and you will see digital content purchases increase. Though I’m surprised they are going with only the 4gig unit, that’s not a lot of space to puy digital content.
The rumor as of now is this deal will be limited to consoles sold from the Microsoft Store. But it would make a lot of sense to also sell this deal through cable providers like FIOS, Xfinity, etc. Instead of you renting a cable box you can grab an Xbox 360 from your ISP and watch your live tv, play your games and get on-demand entertainment.
The only scary thing is, what does this mean for the future of game consoles? There have been rumblings of the industry moving to a more “a la carte” structure. Where instead of paying $60 for a game, maybe you’ll pay $30 for the single player part of the game then pay another $30 for the multiplayer, then another $5 for this part of the game. While “al a cart” would work well for some industries (at least for consumers), hell who wouldn’t want to only pay for the 5 tv networks they watch instead of the 200 they don’t? But for gaming we have seen how developers have cut back on initial offerings and then nickeled and dimed us for DLC on launch. Many publishers have seen revenue increase greatly since the introduction of Free/cheap to play and micro transactions. Just think about how many times you’ve spent 99 cents or 2 bucks on DLC for the same game, would you have spent that much if it was lumped together?
It will be interesting to see how subsidized gaming will work, it could be great for some but could in the long run cause our pockets to be emptied without us even realizing it. Let us know what your thoughts are about this in the comments below.