The prices consumers were previously paying for Xbox Live content are going up now that Microsoft is transitioning away from its Microsoft Points.

Microsoft's decision to ditch Microsoft Points in favor of real-world currency in Xbox Live might prove to be a costly proposition for consumers.

According to reports out of the U.K., where the feature is currently in beta testing, it costs more to buy content in real-world money than it did with Microsoft Points. Eurogamer, which previously reported on the issue, says that games that cost 1,600 Microsoft points used to set U.K. customers back 13.60 pounds ($20.25). Now, the titles cost 14.99 pounds. Similar price hikes were discovered on 1,200, 800, and 400 Microsoft Points.

Several Reddit posters, who are up in arms over the price increases, say that the games now cost about the same as their counterparts on Sony's PlayStation Network.

Microsoft has been quietly beta testing itstransition from Microsoft Points to real-world currency in its upcoming fall dashboard update. The move follows Microsoft's decision last year to ditch Points in Windows 8 in favor of credit cards and debit cards.

For now, only U.K.-based gamers are complaining about the change. It's not clear how the switch will affect gamers in other countries.

Source

In what should be absolutely no surprise to anyone. The whole reason why Microsoft made the move to Microsoft Points was because it was cheaper. By using a common currency and selling that currency world-wide in local denominations, Microsoft was able to avoid having to pay credit card fees.

So, yeah I could easily see price increases of 3% to cover the cost of credit card transaction fees. Not to mention, there'll likely be exchange rate fees that are figured into the costs.

Be careful what you wish for. Old cliché, still quite relevant ...

Hasn't the pound been extremly weak this year?

Yeah, I got the update and you can only use real cash now. If you had MS points it's converted to real currency. I only had 2.00 after that ultimate game sale last week.

Yes, but the benefit of and the beauty of Microsoft Points was the fact that gamers were protected from Exchange Rate hits.  If you bought £50 worth of Microsoft Points when the the GBP was strong, then you could get Microsoft Points cheaper.  The content stayed the same price, the only place you saw the effect of exchange rates is at retail.

Not to mention, again Microsoft takes a hit for every credit card transaction made.  So they're going to increase prices to cover that cost as well.   

I never understood the hate toward MS points. Ya, sometimes it was confusing to know exactly how much what was, but there were benefits to them as well.

The problem is people are absolutely ignorant.  They don't actually investigate and learn.  They're unintelligent, uneducated, and emotional idiots.

People read opinion as fact, rather than trying to dig deeper and actually understand something.  So they accept the idiocy of some stupid fuck that doesn't take the time to learn and understand it, he or she just offers their opinion.  What ends up happening is people just reguritate someone else's uneducated opinion.  The human centipede.

Eurogamer also reports 800 msp games going from 6.80 to 8.99, that's a 32% price hike.
And doesn't not having to produce and distribute live cards more then offset the 3% credit card charge?

Exchange rate reason is bullshit too. The Canadian dollar has been on par with the US dollar for years, even been worth more then the US dollar, while MS points have always stayed 20% more expensive over here.
It's $7.25 here for 500 points, already more expensive then psn equivalents. That would be 7.37 pounds for an 800 points game by todays exchange rate.
Anyway I would be happy if XBLA prices in Canada get on par with PSN, 14.99 for a 1200 point game instead of 17.40

Yeah this another example showing how moronic the gaming community voice of the masses can be.

I usually stock up on points when stores like Dell and Best buy have their 15-25% off sales. Microsoft Stores also offer $10 off coupons when you do surveys. No more free points every month for Xbox Live usage either...