Microsoft confirms subsidized $99 Xbox 360 4GB, Kinect bundle

By on May 7, 2012, 4:30 PM

As rumored, Microsoft has revealed plans to offer its console under a subsidized pricing structure often used by mobile operators. For $99, the company offers an Xbox 360 4GB with Kinect. There is a catch, of course: you enter a two-year Xbox Live Gold contract for $14.99 a month. Unfortunately, while that may be attractive if you're strapped for cash, you'll actually pay more than if you just purchased everything by conventional means.

You'll shell out $458.76 (sans taxes etc.) for the subsidized hardware and contracted service versus $380.19 if you bought everything upfront off Amazon as of writing ($283.37 for the hardware, $48.41 a year for Xbox Live Gold -- though the latter is often on sale). And before you ask, no, you can't buy the subsidized console and neglect your contract. Early termination fees range from $250 to $12 depending on the time you cancel:

Rumors originally indicated that Microsoft might improve the value by bundling some paid third-party services through Xbox Live, but that doesn't appear to be the case. As such, some critics consider this an attempt to "prey upon" unsuspecting lower income shoppers, who might not otherwise purchase a console. This would let Microsoft fully exhaust the potential customer base before shifting gears to its next-generation hardware.

If you're still interested, print this coupon and swing by a Microsoft Store. It's worth noting that you might have to undergo an "eligibility check," including credit approval. You have 30 days to back out of the deal, but the first monthly payment of $14.99 isn't refundable. View the full contract terms here. It's unclear how long the program will last or if it'll be available online -- Microsoft merely says that it may terminate the offer at any time.




User Comments: 14

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Scshadow said:

If you fall for it I really don't feel sorry for you. Stupid people pay stupid tax.

Vrmithrax Vrmithrax, TechSpot Paladin, said:

So Microsoft gets hard and heavy into cell phones, and now the horrible cell phone subsidization mentality seems to be leaking over into other areas of the company. How long before we have to buy a subsidized computer and pay a subscription fee to use Windows, I wonder?

SNGX1275 SNGX1275, TS Forces Special, said:

@ Vrmithrax - Not a contract thing, but subsidized computers have been around since at least Win 95. AOL, Norton, Office Trial, and every other 'trial' software that a branded PC comes with. Build your own and you don't get that - but I have seen trial software bundled with hardware, but of course you'd have to install that intentionally.

I don't think it is too far fetched to expect contracted software though. Didn't Adobe just do this with Photoshop?

1 person liked this | davislane1 davislane1 said:

I don't know which is worse, Microsoft bringing contracts into the gaming world or there being enough people with their financial priorities backwards enough to create a viable market for it.

ramonsterns said:

I don't know which is worse, Microsoft bringing contracts into the gaming world or there being enough people with their financial priorities backwards enough to create a viable market for it.

The latter, hence why DLC and $60 PC games exist. Stupid can't be helped, but I wish I was an engineer, so I could fix it.

amstech amstech, TechSpot Enthusiast, said:

Owning a new xbox is not cheap.

Paying for xbox live gold memberships is not cheap.

Paying for xbox live services is not cheap.

Paying for DLC is not cheap.

I say go with a PS3 if you want free internet, free online play and the ability to search for new games and movies online without needing to pay, unlike xbox live.

If they keep coming up with nickel and dime ways to make money I am shutting my xbox live account off, and its not coming back on.

Guest said:

"You'll shell out $458.76 (sans taxes etc.) for the subsidized hardware and contracted service versus $380."

Whoever buys this deserves being ripped off!

Furthermore, what kind of sadistic person would spend ~ $460 to play Xbox 360 for 2 years before the new one is out and makes 360 completely obsolete, not to mention one can get PS3 for $250 and have $210 left over to buy games!!

This puts things in perspective that owning consoles is really not as cheap as people make it sound. Imagine buying the Xbox for $400 on launch and using it for 7 years, each year paying annual subscription fee of $50? Then add the cost of console games vs. Steam/Origin, etc. There is NO way that it costs less to own a console than to build a desktop rig and resell/upgrade parts every 2-3 years in that same period of time, especially since CPUs now last longer than ever and RAM is dirt cheap. Even a Core i7 920 @ 4.0ghz is still very viable for gaming and it came out in 2008!

The next generation of consoles needs to reassess charging $60 for console games and $50 a year to play games online like Xbox now does. I still can't believe it costs almost $460 just to play for 2 years on a 7 year old console ....rip off!

tonylukac said:

So Microsoft gets hard and heavy into cell phones, and now the horrible cell phone subsidization mentality seems to be leaking over into other areas of the company. How long before we have to buy a subsidized computer and pay a subscription fee to use Windows, I wonder?

IBM mainframes always had rented software. The cobol compiler used to be like $2000/month per cpu, altho 200 people could use it.

Vrmithrax Vrmithrax, TechSpot Paladin, said:

IBM mainframes always had rented software. The cobol compiler used to be like $2000/month per cpu, altho 200 people could use it.

True, but that is an enterprise business situation, where recurring license/subscription fees are more common (usually due to the enhanced nature of required support and other factors). I was pointing at the potential for targeting consumers with forced subsidization and contractual obligations.

TorturedChaos, TechSpot Chancellor, said:

I don't know which is worse, Microsoft bringing contracts into the gaming world or there being enough people with their financial priorities backwards enough to create a viable market for it.

So many people have their financial priories completely bass ackwards. My friend owns about 18 rentals and he see's this all the time. They don't have rent but they have money for a carton of smokes, huge box of poptarts, and a CostCo sized box of Hot Pockets. Sure they might have a huge load of groceries, but they are ALL pre-package food that is expensive.

He has come to the conclusion the poorer a person is the - the more poptarts, Schwan's dinners, and pre-packaged food you will find in their house.

Other one he has heard a lot is "Well I can't pay my rent this month I want to give my family a good Christmas." Hey guess what so do I! But your rent pays for that......

Back on the main topic - its a smart move my M$ - it will trick people into getting it by seeing such a "low" price. Sadly there are lots of people who will jump on this thinking its a good deal.

I don't say I necessarily approve of it, but in the end M$ is a cooperation that sets out to make money.

Now I can see his renters "Sorry I can't pay my rent I signed up for a Xbox contract that is taking all my money :P"

SNGX1275 SNGX1275, TS Forces Special, said:

True, but that is an enterprise business situation, where recurring license/subscription fees are more common (usually due to the enhanced nature of required support and other factors). I was pointing at the potential for targeting consumers with forced subsidization and contractual obligations.

I said it above, in response to your post actually, but nobody paid attention. Adobe CS 6 is subscription based. Techspot just put up an article on it now.

ramonsterns said:

Owning a new xbox is not cheap.

Paying for xbox live gold memberships is not cheap.

Paying for xbox live services is not cheap.

Paying for DLC is not cheap.

I say go with a PS3 if you want free internet, free online play and the ability to search for new games and movies online without needing to pay, unlike xbox live.

If they keep coming up with nickel and dime ways to make money I am shutting my xbox live account off, and its not coming back on.

I have a better idea. Build your own PC.

amstech amstech, TechSpot Enthusiast, said:

I have a better idea. Build your own PC.

Been buildin PC's since 1995.

http://www.overclock.net/u/113960/amstech

Guest said:

I don't know what the earlier poster was squawking about with packed foods being 'expensive luxuries' this has been shown time and time again. have a dollar to spend on food, spending it on 'packaged processed' 'foodstuffs' will go much farther calorie wise than fruits and vegetables.

are you expecting those without to forage?

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