It isn't. Live offers an excellent, top of the line online service for the xbox fanbase...but when you're competitor are offering free online service and OPTIONAL additional/rental/etc services at a cheaper price as well as similar features found on Live, it makes you wonders why Live is still charging. Also, the games Plus provides aren't some crappy minis or indie games. Playstation Plus is giving out (not for free) full big-time titles for less than $5 a month. You can argue that you only get to keep em as long as you are subscribed but once you beat the game, chances are you aren't going back to it,
Obviously, its the smart decision by MS. They have a loyal, die hard fanbase that willingly will put up the money for Live. Also, a heavy focus on online multiplayer shooters (CoD, Halo, GoW) ensures that people will be hook on online play.
The hate Live gets is somewhat justified, to resume, as your competitors offer very similar services to their fans for free. Granted, whether Live is A LOT better than what Sony and Nintendo offers is debatable. Personally, I've played on Live and I haven't seen a giant difference as far as connection, lag, community, etc.
"Trick shot? The trick is NOT to get shot." - Lucian
