Microsoft Announces Subsidized $99 Xbox 360 bundle

The rumors going around last week about a subsidized version of Microsoft’s Xbox 360 console were true. Microsoft has officially made the subsidized home console a thing and will be launching it soon. For $99 up front and a two year Xbox Live Gold contract at $14.99 per month (A total investment of $459) you will get a Xbox 360 consoles with 4GB of storage, a Microsoft Kinect and two years of online service.

When I first heard the rumors that Microsoft was planning to offer a cheap Xbox 360 and Kinect bundle to those who were willing to commit  to 24 months of online service, I thought it was great idea and that it had the potential to change the way home consoles are sold. Now that Microsoft has released all of the details of its subsidy plan and we have more information, it just seems like a meh deal for consumers.

First, the $14.99 per month is for the exact same service you get from Xbox Live Gold,  except it costs a lot more and you are stuck paying it each month for two years. When I first heard the price I figured they would do what Sony has been doing and offer a higher tier of paid online service with additional benefits. If Microsoft had done that and bundled this with a special streaming service it would have gave consumers a huge incentive to pay nearly three times as much for online service.

Secondly, The Xbox 360 is how old now?  We hear new rumors about the Xbox 720 or the next Xbox all the time. It seems like right now would be a bad time to get locked into two years of service on a console you may stop playing soon.

To be fair, this subsidy deal isn’t completely horrible. Consumers will end up paying $40 dollars more over the long haul, which isn’t that bad, but you still pay more later for the benefit of paying less now.  If you don’t have the money to pay up front for a contract free 360 this could mean having one now instead of waiting. In that situation this type of deal could make sense. It is just disappointing to see that Microsoft didn’t take this opportunity to offer more.