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S.T.A.G.E. said:

I agreed with pachter on the ads part, but again Microsoft doesn't need them because as Pachter said they broke even on Xbox Live after 2-3 million users. Xbox Live is a constant surplus for Microsoft and they dont give very much either. Those ads are just excess money in their pockets. All I can say is rape. We can understand why Facebook and Youtube have ads, because those things are free and they need the ads to function as an online system. Hell, I dont even care if Sony did it with all they've done because they've remained ad free, but Microsoft is on overkill.

The thing to understand is that while the division that the Xbox team is a part of is doing well, the team that Xbox LIVE is a part of has slowly been climbing up.  The Online Services business has been in the red for a LONG time.  Xbox LIVE is paying for a lot more than just the cost of the Xbox LIVE service.  With Xbox LIVE being successful Microsoft is going to do two things, 1) they're going to eek out every cent that can so get the division to balance, 2) they're try to build on the success of the service as much as possible expanding it out.

When you see the Online Services division go in the black, then you might see some things change in terms of pricing.  Until then, Xbox LIVE is the profit center for that division and Microsoft is going to use it however they can to gain profitability for the division.