Microsoft explains Xbox Live price hike

XBL's Craig Davison says Call of Duty map pack timed exclusivity, Halo, Gears franchises all part of funding concerns.

In late August Microsoft announced that it would up the annual Xbox Live Gold membership fee from $50 to $60. The change went into effect yesterday alongside the arrival of the fall dashboard update. At the time, Microsoft offered no rationale behind the price hike, but now a company spokesperson has details to share.

Xbox Live is now $10 more expensive.

"In 2002 it was strictly multiplayer gaming," Xbox Live's Craig Davison told Gamasutra in a recent interview. "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."

Davison also told the industry site that the subscription price rate climbed due to the fact that Microsoft is always looking for more and more services and features for Xbox Live, and that costs money.

"So during that time, we've definitely got to fund it, and we want to add more and more and more,” Davison continued. "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."

Last week Microsoft announced that its Xbox Live subscribers--who extend 25 million deep--spend a total of 1 billion hours on the service each month. The company also announced that it has sold more than 45 million Xbox 360s in 35 countries since it debuted in 2005.

Written By

Eddie Makuch is a news editor at GameSpot, and would like to see the Whalers return to Hartford.

Discussion

531 comments
Ton77
Ton77

@james16_06 very well said. people complain way to much.. grow up people

adrigt
adrigt

Exclusives do NOT do good to me or you guys, they do good to the platform they are exclusives... As in buy xbox so you play halo , or buy ps3 to play killzone etc... So they are telling us that one of the reason we are getting charged extra is that they are getting exclusives(i.e. they profit more in the long run?) So get charged more money because they are making more money , yeah that makes sense.

maverick_76
maverick_76

Man, I'm so glad I chose to go PS3, that is one less game that I could afford every year.

l777l
l777l

Yeah, the additional funds, going from 400.000 users to 25 million users means, surely must be marginal.

mdluk199
mdluk199

frazzle00 said "It is a FACT that things go up in price, even if there is no commensurate improvement in service. It is called INFLATION. And as for "we gamers, get our consoles for stuff related to gaming", well I didn't see any Sony fanboys whining about Sony using the PS3 as a trojan horse for the Blu-Ray format!" ----------------------------------------------------------------------------------------------------------- You really are an idiot aren't you?! Blu-Ray is not just about movies it is also a great storage system for video games. Micro$oft in their desperation to get to market first launched a next gen console (with fundamental flaws it has to be said - RROD), with a last gen format storage system. Developers are now all complaining that the dvd format used by the 360 and it's lack of storage space is the number 1 limitation holding games back. As for Live being better than PSN i would say there is little to choose between them. Apart from party chat there is nothing that Live has that you can't get for free elsewhere. And over here in the uk the PS3 has many great features that the 360 doesn't like BBCiplayer, Lovefilm, Mobo, VidZone and Blinkbox. Live is a rip off and Micro$oft points are an even bigger rip off by the way.

james16_06
james16_06

Hahahaha I dont wanna sound like a dick, BUT people are seriously crying about $5 a month?? Can you imagine how much money you waste on junk food and itunes every week?? Yeah Im a little jealous PS3 gets it for free, but $5?? Chump change.....

Zanoh
Zanoh

@mad_krips Perhaps but that is the reason why I no longer own a 360: Because Microsoft treats its silver members like *insert derogatory remark here*

PayneKiller
PayneKiller

@Zanoh you are asking for PSN... that is almost like blasphemy isnt it?

Zanoh
Zanoh

I wish MS would just charge 60 for those that want the overtly features and just give online free (with no features) for silver.

Hvac0120
Hvac0120

[quote="Phatjam98"]Your complaint is that there are too many features offered. Are you silly?[/quote] 1. My complaint is not about having too many features, per se. Instead my complaint is that there isn't an option for people who just want to get online. 2. Yes. I am silly. 3. I will not repost to you because we are on completely different terms on this subject and you lack the ability to intelligently argue the your side of the debate. In laymens, I agree to disagree on this subject matter with you. Good day, sir.

Tokinblckgie
Tokinblckgie

TC_Squared Either that or Kinect advertisement...

Phatjam98
Phatjam98

@kavadias1981 I'm so sure there are just a ton of XBLive users that are just devistated at the 5 bucks a month they will have to pay rather than the what... 4.25 they used to pay? This is just straight cheap. If you dont want to use XBLive than just get rid of it. If every Live user is upset as you claim, and drop the service, MS will drop the price.... its supply and demand. I do not, however, think that your assesment is correct that Live users are the one that are unhappy about this. ESPN3 is awsome for those of us that are nerds but love sports... the updates to Netflix are great... the game content is so much more robust that what it was when Live first launched and the game and entertainment coverage is killer. You dont think that costs MS money to produce all of that content? It should all just be completly free right? Look at the offerings on PS3 or the Wii, do they compare to the content offered on Live? If you feel it does, than dont pay MS for the service and enjoy your PS3

MikeManiac61
MikeManiac61

you can actually get your yearly subscription at amazon.com for $43.99 so i don't really care

Phatjam98
Phatjam98

@Hvac0120 Nope its being cheap, again its like 5 buck a month. its less than a taco bell meal, or a case of soda. Your complaint is that there are too many features offered. Are you silly? Thats your argument? Please enjoy your PS3 online service and leave the XBox threads alone if you feel that way. I've never head anyone complain about too much good stuff! LOL

TC_Squared
TC_Squared

Am I the only person who has skepticism about MS doing stuff like THIS after they supposedly repair our faulty consoles for free? Are we, the gamers, indirectly paying for the RRoD repairs?

blueguykisame
blueguykisame

wish the epsn feature was better. Like.. i wish we could watch full games. not just small highlights of every game. oh well.

zzamaro
zzamaro

@frazzle00 I can't prove that ESPN is one of the reasons was because it got more expensive? Did you even read this GameSpot article?

zzamaro
zzamaro

@PixelAddict I never claimed I was "the man", NEVER, don't say something I didn't say. Gaming is not just gaming? Tell that to all the gamers here on GameSpot and said they also don't need that stuff(ESPN, last.fm, etc). You clearly are stating something is not true. All of us care more about our gaming features and if you are talking about casual who are not on GameSpot, leave alone those. If something here is trolling, that's you.

buying1999
buying1999

Everything goes up in price eventually. If you want to continue to have the BEST online experience available, getting dlc first, getting exclusive dlc, getting demos first, then it's a great deal. I'm also on psn and believe me there's a reason it's free. You get what you pay for.

sophospeare
sophospeare

@phonz I'd sure like to know what ISP you use. If I can pay $5 a month and get top tier service, sign me up! Now to the crux of Davison's argument, "And we've gone from 400,000 members in our first year to 25 million." Yes, which will cost more, but you're also getting 24.6 million more subsriber fees every year. Economies of scale tell us that the more a product is purchased, the less it costs per person. Totally invalid argument. On to exclusives, Davison said "Now we get those Call of Duty map packs before anybody else does. We've got Gears and Halo, of course, as exclusives." Yes, the exclusives cost more up front, but you receive more in license fees because you will sell more copies of a third party game like COD and get all of the license fees from exclusive games like Gears and Halo. Another invalid argument. How about added content, "ESPN is a great example. No extra charge for Xbox Live Gold members." Um, what do you call the $20 price hike? You keep providing content that is available through other means. Most of us have a PC and don't need Facebook, last.fm, ESPN 3, etc. Look, I'll admit, Netflix was a great idea, but how about giving us a choice in the programs we want and offering pricing tiers related to that choice. Don't let MS fool you, the extra content is the sole reason for the price hike. $20 a year isn't a big deal, but if more price hikes for content I don't want are coming, Live will have one less customer in the future.

_phonz_
_phonz_

10x more members means 10x MORE bandwidth you need to account for. The Supply and Demand curve is still breaking in their favour though as they are charging more for their service then most ISP charge you for accessing the internet at their top tiered speeds.

Reilly86
Reilly86

I dont know why people are moaning about this, In the UK Microsoft charge about £45 for a year so I buy mine for £20 of eBay which come from Asia. That way I get to game online for a year knowing that Micro$oft get only half the normal money. And anyway if they what to up the price for Live then I for one want real prices not points and cheaper arcade / DLC.

Slash_out
Slash_out

I'm sorry microsoft. But if more members are coming in, it means also more paying members. That's how you fund the service... If there are ten times more members, there is ten times more money coming in. You are giving ESPN free of charges? Is that so? Then what do you call the bump in price of the monthly fee? Is that not extra charge because of those added features wether or not the client uses them? And what about those exclusives ? Sony and Nintendo also have exclusives. And their network is free. Exclusives are your job and responsabilities. It is your responsability that your system gets as many multiplaform games as possible, but as many excusivities as possible as well to make the system worth the purchase. It's not the responsability of the player to pay more so you can bring them. And what about that stuff about paying for multiplayer? Servers are hosted on the players consoles. You have no cost in maintaining those. I have an x360, a PS3, and a Wii. But I'm sorry your service is a rip off, online gaming should not cost players. It should be free, even it means all the others (useless to most players) features would need a monthly fee. Just like the PSN+.

PixelAddict
PixelAddict

@zzamaro You keep feeling the need to claim you are a man. Methinks thou dost protest too much. You also feel the need to call my education in question. So I give you this: working for a consulting firm for over 7 years, I specialized in understanding and articulating the future of technology as it relates to individual user types. You clearly would fall into one of the traditionalist, coupon-cutting user groups. If you are too obtuse to see my point, I will spell it out a little clearer for you: Move on with the rest of us. Convergence is here, whether you like it or not. Gaming is not just gaming, it's social connectivity, it's movie watching, and it's (apparently) now fitness management. THAT was my point about me getting the most bang for my buck on all the technology I own. I'm not unique in this. This is not opinion. There's reems of data supporting this. But you... well, you are uniquely troll-ish.

holdentorana74
holdentorana74

Oh, and most of those games you wrote there are actually ONLY Xbox and will NEVER hit the Sony market. (Refering to the many Kinect games.) I actually added games that COULD be made available to Xbox such as Gran Turismo 5, and ModNation Racers. In saying ModNation Racers, it is a PS3 and PSP exclusive yes, so it still counts as an exclusive. ------------------------------------------------------------- Edit: LOL! Your adding PSN and XBLA exclusives? Ok, do you want me to redo my list also adding PS1 classics? Believe me, it wont be pretty.

holdentorana74
holdentorana74

I dont get all my sources from Gamespot unlike you. I search for them.

Nightrain50
Nightrain50

I quit xbox live years ago cause it was never worth it. Peer 2 Peer gaming should always be free, it's our internet bandwidth hosting almost every console games multiplayer matches. I bought a PS3 last Christmas and have bought every game since then for it. Microsoft lost an xbox fan to greed and the price hike is just more insult. I know people have invested a lot of money into their game collections that it feels to late to switch platforms now. I sympathise, but it must be done. Don't be forced to pay for something when you now you shouldn't have to. Take the loss, and vow to never support that greed again. You will feel better.

StArDr1fTeR
StArDr1fTeR

@frazzle00 Oh geez. Sorry I read that wrong. I guess that isn't bad. I take back my last comment. But your right, each his own.

frazzle00
frazzle00

[This message was deleted at the request of a moderator or administrator]

StArDr1fTeR
StArDr1fTeR

[This message was deleted at the request of the original poster]

Prithwiraj
Prithwiraj

Lol, I knew this would turn into a fanboy flaming thread, everyone like these do. I'm upset about the price hike as well. Its not about the money, I dont think anyone here is moaning because they can't afford it, its about the principle. Basically that dude who is trying to justify the price hike put a foot in a mouth, and all the LIVE subscribers are disgruntled. I mean, "All Gold subscribers get ESPN for free, there is no exra cost" then what are those $10.00 there? a donation to M$'s "Make us more money" charity fund? lol got both the consoles, and i will agree that XBL is better because of the cross-game voice chat, a better party system and the pre-game lobby. Having said that, there have been rumours about cross-game voice chat, and sony did mention that it wont be a PSN Plus exclusive feature. Also, when it comes to online gaming, i think the PSN and the XBL are at par, cos I've played MW2 on the xbox andthe ps3, and never had any problems on either consoles. To conclude, I'd say while the XBL has the above mentioned advantages and the extras, the PS3 has an internet browser with full flash support.

frazzle00
frazzle00

[This message was deleted at the request of a moderator or administrator]

frazzle00
frazzle00

[This message was deleted at the request of a moderator or administrator]

frazzle00
frazzle00

[This message was deleted at the request of a moderator or administrator]

zzamaro
zzamaro

@frazzle00 I never rejected inflation. I have said it in previous news, inflation wouldn't be a bad thing but fact is, like I previously said, LIVE got expensive because of non-gaming stuff, etc, I won't repeat myself. If the increase was because of gaming features, it won't be a problem because I understand it, I'm a man, not a kid or a fanboy.

holdentorana74
holdentorana74

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sharpshooter188
sharpshooter188

@Holdentarana74 FF13 came to both systems. :) But I agree, I think 360s are just getting stuck. I cant tell you how much money Ive had to invest in my 360 just to play my games normally. Had to buy 3 friggen systems now since the first 2 red ringed. The first had MAJOR white screen of death issues, my controllers started going to hell after 5-6 months and the charge packs died, plus I get nickel and dimed for DLC and on top of which I cant play indie games that I buy unless Im online which costs more. After this 360 dies Im switching to PS3. No question.

holdentorana74
holdentorana74

[This message was deleted at the request of a moderator or administrator]

holdentorana74
holdentorana74

[This message was deleted at the request of a moderator or administrator]

frazzle00
frazzle00

[This message was deleted at the request of a moderator or administrator]

frazzle00
frazzle00

[This message was deleted at the request of a moderator or administrator]

holdentorana74
holdentorana74

I agree with ResSoxfan67. My PS3 does everything the Xbox360 does, but for free! I dont mean to get my nose into Xbox's business, but they seriously need to make the prices cheaper, not more expensive to be able to keep up with the PS3. And although the Xbox has certain exclusives, it was proven that PS3 has had more exclusives this year then any other computer console.

zzamaro
zzamaro

@frazzle00 Why do you even bring that cable stuff here? When I said Microsoft, I didn't mean about windows or any other microsoft sproduct. It's only about Microsoft and X360. Fact is that LIVE got more expensive because of non-gaming features. ESPN, las.fm, Facebook are not gaming features. We gamers, get our consoles for stuff related to gaming. And if you can't/don't understand that, don't even bother in replying.

zzamaro
zzamaro

@PixelAddict Again, you are going all off-topic and going to personal opinions about different stuff. All of us are talking about this news because it's about our future about gaming on the X360 and you are talking about you and what you do with your life. Do I need to spell it for you? G-A-M-I-N-G. Most important things we want on a gaming console are games and gaming features. We do NOT want Facebook, ESPN, last.fm, etc on the LIVE subscription because we care mainly about games on our consoles and its features. There's NOTHING bad about adding ESPN, etc. but those non-gaming features are affecting all of us and the price was increased because of them. Those non-gaming features must be in a different package(Platinum LIVE comes in mind) for people interested in them. And if spelling doesn't help, you better go back to school.

RedSoxfan67
RedSoxfan67

I don't care about last.fm, hulu, espn, facebook and twitter on my Xbox. I can do that on my pc and ps3 for free. 60 bucks for me to pay for something that my ps3 and pc also do is stupid, and you already pay 60 bucks on a game that has multiplayer with it, yet you need to pay the xbl fee just to play it. I may cancel my subscription soon.

PixelAddict
PixelAddict

@zzamaro You are moving forward in life, clawing backwards, yearning for a simpler time. One without technology and capitalism. Buy it, or don't. Nobody's forcing you. As for me? My Blackberry updates with Facebook and plays me tunes on Pandora while I work out. All the while I can email with customers and friends, and I choose never to "Tweet". My house is networked and I make use of about 6 devices on my WiFi. Secretly, I wish my Bluray player streamed Internet apps. You see, I get every dollar out of the pricey technology I choose to purchase. If you do not, this is not my problem. Friend.

Gigaman222
Gigaman222

I'm not worried about, had my fill of reach so ill just buy the rest of my online games through sony. No one cares if the xbox service is better for netflix cause the majority of people just want to play there games online. Ill use my home computer to do the things xbox claims they have to charge more for.

frazzle00
frazzle00

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frazzle00
frazzle00

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