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Solid_Snake4RD said:
does a 360 user have to extra or is it covered in its yearly xbox live subscription

Hard to summarise in a paragraph or two but the following link is great for answering questions:

http://www.avforums.com/forums/xbox-360/1110404-sky-player-launching-28-october-2009-faq.html

Basically if you have Sky already then it's free for On Demand stuff, if not then it's extra.