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Steam was crap when it first came out. When I originally installed half-life 2 it took 7 hours to get working. Look at steam now? Its a great service, but it took years for valve to convince people. The same will happen with windows live. Its a new service and it will take years for it to become a viable platform. Add a few extra years because of all the microsoft hate out there and you've got one massive task.

It may be crap now but in the future it may end up being just as good as steam, who knows?