I don't for a second think that MS will ever be able to push all the other players completely out of PC to then slap a sub fee onto the platform, the competition is just too rich and varied, not to mention still stronger than MS is with the platform itself.

I can see MS trying it regardless like they did with GFWL and since the whole Win 10/MS store is their own private bubble, it would be easy for them to attempt it the way they have gone about Windows 10 adoption, do it forcefully but make it look like it's doing no harm, that it's safe and good for you, that more or less got them a netted win for win 10 adoption rates despite the tactic in the past being a bad one (I honestly think it's one of the worst towards a consumer but to a business it makes perfect sense).

No, absolutely not. Charging for online multiplayer makes a lot of money. If they made that free, Gold subscriptions would fall significantly. PS Plus barely had 3m subscribers when it was just a rental service.
MS would be saying good bye to a huge amount of money if they did what you're suggesting.

I agree. They should make MP available for everyone but launch GWG as part of XBLG on PC aswell. GWG in itself will keep a lot of customers with XBLG and expanding to PC will broaden the market. MS is going towards a hardware-independent solution in the future so software is were the revenue will be, and where you have the lowest costs for R&D. It would benefit them longterm and bring PC and consoles gamers together.

So your saying that they are retaining xbox for the sole purpose to making younger people like their products to the point where they buy Microsoft Office and windows operating system based computers? If so, I disagree. Yea, sure, iphones and ipads dominate, but in the world of actual computers apple is a joke compared to the sales of windows based computers, and I don't see that changing really, not with Windows 10 having a ton of convenient changes made to the bad windows 8 operating system. 10 is like the perfection of 7, which was what vista should have been succeeding arguable the greatest OS of all time, proportionally; XP.

Huh? I'm not sure what you're trying to say, and I'm pretty certain that you're not sure what I meant. I probably stated it poorly. To summarize :

Xbox revenue/profits are the definition of irrelevant for Microsoft as a whole (in fact,their entire consumer-facing product lineup is basically the same case of pretty much zero impact on the bottom line). The VAST VAST majority of MS's income comes from business products.

Apple's computer sales are basically the same story for them : irrelevant in their big picture. iPhone, iTunes/Apps dominate their financial picture to such a massive degree that it's basically 'iPhoneTunesCorp'. iPad is falling pretty fast (tablets in general are doomed), and Mac is on a downward spiral because it seems they just don't care. They just dropped their Thunderbolt display with no replacement, merely the latest in a long list of unspoken hints that Mac means nothing to Tim Cook and the new leadership.

So to recap, Xbox means nothing to MS in terms of $$, as the + and - impacts are literally molecules in the drop in the bucket in the ocean to them. But in terms of consumer headspace, nothing else MS offers really has much brand awareness, particularly to the younger customers, many of whom have never and will never own a PC. So yes, I think the only reason MS has kept Xbox going is simply for consumer outreach and brand awareness. The writing has been clear since they let iOS and Android dominate the mobile space that they were simply too late to get going in mobile. Windows Phone is a fine product, but it will probably never break 10% global market share. However, by keeping Xbox going, they can try to crack away in the consumer space almost as a hobby (in comparison to their behemoth business-facing business operations). Xbox could double sales or vanish tomorrow, and the bean counters at MS probably wouldn't notice, haha. But marketing and product development are always paying attention to outreach. This is in stark contrast to Sony, which is a much smaller company overall, and for whom Playstation is a sizable chunk of their revenue. Insurance is still their top product, but PS isn't tiny compared to the rest of the company. MS is gargantuan in comparison money-wise.

I agree totally about W10, it's great. I also think what they're doing with Xbox on Windows is brilliant and way overdue.

Anyway, I don't think we really disagree about anything to be honest. Things simply are what they are.

MS are in the business of making money and the xbox brand has lost them a lot of it. XBL is a shining light that has brought in billions.

Would Microsoft give up billions in revenue just to sell a few extra XB1s? I doubt it. And I don't blame them either.

Can't sell Gold on a platform if you let it shrink to irrelevance. XB1 has been losing steam as the gen goes on, not gaining. So why cling to something that is a tiny fraction of their income when there is a better choice?

MS has said about half of XBL subscribers pay for Gold. We may take this as possibly optimistic as a PR statement, but let's just take it at face value. Accepting somewhere between 40-50M XBL users, let's go with the higher number and cut that in half. 25M gold subscribers. Now let's assume EVERY one of those subscribers pays the full $60 instead of heavily discounted as is easy to do in many cases. Result? 1.5B/year revenue. Not pure profit, assuming you believe everyone who likes to say they have to pay for servers/etc. Which is true to some extent, but whatever. MS's revenue last year as a whole? 93 billion. So yeah, maybe 1% of revenue. For which they have to pay for a bunch of content, servers, advertising, R&D, support, etc. 

Microsoft would have made more money simply investing in Apple and Google stock than ever starting Xbox. Some wise folks have analyzed Xbox as a whole, and it's virtually certain that in totality, it's still yet to get out of the red when you factor everything from FY '00 to current day.

But as I've noted in previous posts, even the losses don't mean much to MS as a whole. Xbox is tiny to them.

Why not make your customers happier? Besides, MS gets a solid cut out of every peripheral, media purchase, and 3rd party game sold on the platform (to say nothing of huge income from 1st party content). Financially it would probably be a wash either way at the end of it, only this way you end up with more users and higher customer happiness.

Xbox doesnt exist to make amazing profits. The brand was created to help Direct X. Aslong as Xbox isnt a gapping hole of losing mass amounts of money, MS will continue to support Xbox. It has kept so many devs from leaving PC grogramming. In saying that, Live has made Xbox billions over its decade so i highly daubt MS would even consider dropping the pay wall over a small group of gamers that will game on there products regardless. Xbox plays alot more of an important role than many gamers think and give credit for.

No Live shouldnt be free, its the shiny light and the life support of the Xbox brand.

Has it really gotten that bad?

Online games are among the most popular X1 titles, so its safe to presume the service is still going strong.

Agreed, more importantly its unlikely free online play would cause a signficiant sales boost.

Many opted for 360 in spite of PS3 having free online.