Microsoft doesn't operate internally as one company with one budget line. The XBL Services team is highly profitable and earns their keep while opperating independently from their hardware platform or game software development units.

The great thing I love about Gold live is you can buy it pre-paid..

As someone pointed in one of the threads about that leaked document were Microsoft detailed the nextbox, you seem to forget that the xbox360 launched for 299/399 $/€.

I don't see why they can't do the same with the nextbox.

Fault logic is faulty.

Live actually has a cost associated with it. They can't provide the content from various 3rd parties like ESPN and others for free. They pay for that and part of your Live membership covers that along with networking and hardware etc.

I doubt MS factors much if any of Live's retail profits into the hardware profit. Its its own category.

However 720 could be $300 depending on the hardware and how much MS is willing to risk in initial hardware losses. I'd still bet on $350 to $400.

In a perfect world that would make sense. But I could still see it being $399. The hardcore/early adopters you're talking about will still pay $400 and then the $50/year.

perhaps a nerfed $299 sku

I'm guessing around $400. But I bet they are going to closely watch the Wii U launch to help them make their decision.

The same thing can be said about the PS4 if there is one coming out.

MS is definitely looking at this model (and doing it currently in MS stores).

There will be one. I just wondering if they call it PS4 ore something else.