Microsoft Justifies Xbox Live Price Increase

2 min read


Yesterday, the annual price of Xbox Live increased from $49.99 to $59.99 in the US. It’s not really much of an increase – that extra $10 equates to  about 83c US or R5.80 per month, but it’s still an increase in world where the competitor’s online platform is free.

That considered, how do they justify the increase? It’s all about the exclusives, of course!

“In 2002 it was strictly multiplayer gaming,” said Microsoft’s Xbox Live marketing man Craig Davison to Gamasutra. “Now we get those Call of Duty map packs before anybody else does. We’ve got Gears and Halo, of course, as exclusives. We continue to get exclusives on the service as well. And we’ve gone from 400,000 members in our first year to 25 million.”

I’d buy that one, if the COD map packs were free to Xbox live users, instead of 1200 MS points.

“So during that time, we’ve definitely got to fund it, and we want to add more and more and more. ESPN is a great example. No extra charge for Xbox Live Gold members. But we want to continue to bring that content in. We also want to continue to innovate on all dimensions, whether it’s social, entertainment, or gaming. So there you go.”

“Back in 2002, we launched at 49 bucks, which works out to about $4.17 a month, and we’ve held steady for that entire time,”  he said/

“Now what we’ve always been very passionate about is that quality needs to be there, but more importantly, the consistency. So if I’m playing Halo: Reach, Gears of War, Call of Duty, the consistency of the service and the experience needs to be there regardless of what that entertainment application is.”

“So that has been critical. As you can imagine, the costs associated with maintaining a service at that level and making sure all of those features are consistent, we’re hitting that quality bar, we’re adding the customer service infrastructure necessary, we’re accommodating all of the same social features and functionality too, there’s a cost. Infrastructure costs, of course. And we’re continuing to bring more and more content.”

Xbox Live is a great service, but when the competition’s free you really ought to look at ways of brining the cost down, making it a more attractive proposition instead of raising it. On the other hand though, if R5.80 per month is just too much, you ought to re-evaluate things a bit. Maybe you ought to sell that console and use the money on things like..say…food?

Source : Gamasutra

Last Updated: November 2, 2010

Geoffrey Tim

Editor. I'm old, grumpy and more than just a little cynical. One day, I found myself in possession of a NES, and a copy of Super Mario Bros 3. It was that game that made me realise that games were more than just toys to idly while away time - they were capable of being masterpieces. I'm here now, looking for more of those masterpieces.

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