Xbox Live Gold is not good value, and it is holding the 360 back

[NJ5]

DirtyP2002 said:

Well I think Xbox Live Gold is truly awesome and a very big cash cow.

There are like 13 million gold subscribers. Everyone ins paying $50 a year (even more since it is 60€ in Europe, thats like 80USD. Other than that, not everybody has a 12 months subscription, there are some 3 months subscriptions which are more expensive for a year)

so 13 million * 50 USD = 650 million USD For MS (there is no developer or publisher that want a piece of the cake, just MS and the retailer if it is bought @ retail)

For 650 million USD you can buy 3,266,331 Xbox 360 Arcade. And that is just for one year. Do you think the Xbox 360 would move like 2,6 million units (250 USD Elite) more every year if live were free? i don't think so.

 

It may make sense financially for Microsoft, but that can easily change.

I mean both Microsoft and Sony have flawed business models. Sony can't profit, Microsoft can only profit by charging for online. While Sony's situation is more disastrous, Microsoft's can also worsen due to the competition taking the value advantage from them.