You ignore the dilemma though. As PSN's free service nears the quality of XBL (whether that has happened or has yet to happen), XBL loses an important feature that maintains its subscribers. Not everyone, but some and when new consumers compare the two products XBL won't be as appealing as it once was. This endangers continued growth and current subscriptions. The time is approaching when Microsoft will make their decision to address their future and we know they have something up their sleeve and they will most likely unveil it with Xbox 3, though there are even rumors of a tv service on 360 next year.

XBL either needs to increase the value of their free basic service or increase the value of their premium one over their competition in order to continue growth or at least prevent decline. Right now PSN is in full swing after launching PS Plus, their own premium service. It's cheaper, provides attractive content, and opting out of it doesn't cut users off from online multiplayer. It's stiff competition.

This isn't as much about which service is better but more about which service will attract more customers. XBL's superior premium service and bare bones basic service or PSN's basic service and premium service. Many are starting to see PS Plus as the better value over XBL and it isn't a question as to which company's basic service is better. PSN use to compete with its basic service offerings alone and it is only recently PSN has something premium to show for itself and it is a pretty good premium service. So yes, XBL needs to address this or it potentially risks lower memberships or at least less than what PSN is gaining with its new model.

You can't ignore a dilemna that doesn't exist. PSN still has a long ways to go before it approaches XBL in many areas. Furthermore given everything MS has done to improve Live this gen it seems rather silly to speculate that they won't continue improving it.

And I still shake my head at anyone comparing PS+ to Xbox Live. As has been said over and over in this thread, they aren't the same thing, they aren't meant to deliver the same thing. I would hope that a discount service provides "attractive content" and value. Otherwise why does a discount service exist? XBL Gold is not a discount service. MS isn't desperate enough to need a discount service.

I'm just going to assume you pulled the comment about PSN closing the gap with XBL out of your butt now.

You evidently havent been to the payment option for the xbox in a long time.  They added a "remove payment option" to remove your credit card info a couple years ago.

Amazing how many people will not be buying a PS4 when Sony start charging a basic fee next gen. Sony cocked up and vastly underestimated the running costs for PSN this gen, hence why their cutting corners on costs lead to the oversight in security last year. PSN+ is just testing the water. Please feel free to save this post as I know I'll be bookmark it to wave in posters faces if I'm right .

I tried that, I still had to contact Microsoft.

slowmo said: Amazing how many people will not be buying a PS4 when Sony start charging a basic fee next gen. Sony cocked up and vastly underestimated the running costs for PSN this gen, hence why their cutting corners on costs lead to the oversight in security last year. PSN+ is just testing the water. Please feel free to save this post as I know I'll be bookmark it to wave in posters faces if I'm right .

Pachter said Xbox Live was at a profitable point after its first five million users. Xbox Live has been pure profit since its first year. PSN Plus will generate enough profit for Sony to survive off of it. Microsoft could essentially stop the payments and still fund updates for gens a couple gens, but of course they wont.

I'm still amazed by gamers who believe they should get something for free. Of course if a company is foolish enough to give it to you for free "zynga" they'll pay for it in the end. You could say Sony is starting to see the negative effects for not charging for onlive service, increased debt, inability to compete on price, quality control. Unless you plan on PSN being one giant advertisment like google or facebook you need to charge. In the end MS is looking like the man among boys in this department.

No...they are just looking like an American company amongst the Japanese, thats all.

Only difference is gamers had been getting it for free for many years before X-box Live, on PC. Microsoft tried to charge PC players for Live and it failed miserably (and now it's free), especially when they had competition from Steam... which is also free.

I find it bizzare that some gamers don't think that Microsoft couldn't make their money back through alternative means. Even free-2-play video games can rake in massive profits.

I agree to some extent here.  I pay for live and dont have a problem doing so because it is a superior network.  However, microsoft really does need to up their features to justify the cost if they want to stay competitive going forward.  Microsoft basically already does the giant advertisement thing like facebook, and they are the ones charging for their service.  

Microsoft cant keep withholding features given for free on other services and tout them as a reason for paying.  They need to actually add some more differentiating features to justify the cost going forward...