Only way I could see this working is if it's handled like cell phones.
The console itself is free but you sign up for a 5 year contract at say $125/year ($10ish/month) which includes online play, but games, controllers, etc. are obviously all extra.... As opposed to paying $400 for a console up front and $250 for 5 years of online play ($50/year).
Works out to the same either way so it wouldn't matter.
But if you just mean straight up giving them away free, in hopes the person buys Live each year, and a handful of games each year, maybe an extra controller or two....come on dude that won't happen in a million years. What's to stop hobos from walking up and grabbing one that obviously don't have a home or way to play it...and how will they know one guy hasn't just gotten like 5 of them so he has one in each room of the house?
