There is however, a small caveat to the $99 deal that was officially announced today – it requires a two year commitment of $14.99 each month.  That monthly subscription fee does bring you an Xbox Live Gold account and access to all the benefits of a Gold account such as multiplayer gaming and many of the new streaming media apps that are now available.

According to Joystiq this is purely a pilot program and will only be available at the brick and mortar Microsoft Stores around the United States.

So how does the cost compare to an outright purchase of the same console and an annual subscription to Xbox Live Gold?

Well let’s take a look. These costs are based on the current non-discounted prices for the Xbox 360 Console/Kinect bundle, the annual subscription fees for Xbox Live Gold and does not deal with taxes since they can be different in each state.

Purchase with two year subscription:

  • Xbox 360 4GB Console with Kinect for $99
  • $14.99 per month commitment over 24 months of the subscription for $359.76
  • Total base cost is $458.76

Purchase directly with no commitment:

  • Xbox 360 4GB Console with Kinect for $299.99
  • Annual Xbox Live Gold subscription for $59.99 times two is $119.98
  • Total direct purchase cost is $419.97

That is a difference of $38.79 if you stop right there.  However, if you take into account that you can get the console bundle at a discount off the MSRP as well as discounted one year subscriptions to Xbox Live, sometimes at half the price, then this becomes an even bigger increase in the purchase price over the life of the subscription.

In the long run it is more expensive to purchase an Xbox 360 like this but there will be a lot of takers who will be OK with spreading out the purchase price over two years.

One final note, just like your cellular contract, there are early termination fees with this purchase plan as well.


Buyer beware.