Xbox Live brought to you by today’s sponsor as well as your own money

Posted by on December 12, 2011 in Games

The Playstation Network is free, and it’s got ads. Fair enough. Xbox Live costs $60 a year. And as of last week’s update, it has more prominent advertising than the Playstation Network, without any commensurate price cut for the service. In other words, it brings additional revenue to Microsoft with no additional value to you. Don’t write it off as a simple piece of screen real estate you can ignore. There’s a principle at work here. Microsoft is selling your eyeballs and you don’t get a cut of that. As the internet and videogaming hash out various revenue models, I feel there should be a line between subscription-based and advertising-based services. One or the other, gentlemen. Make up your mind.

It takes a bit of work and a free OpenDNS accounts, but I recommend this Reddit poster’s suggestion for how to disable the ads. Which I will gladly endure on a service that doesn’t cost $60.

Now if only someone can figure out how to get rid of the ubiquitous tab for a search function I will never use. Anyone on Reddit know how to de-Bing my console system?

  • NarcoSleepy

    I haven’t seen any actual numbers one way or the other, but I suspect that the price of XBOX Live is only paid in PART by the $60/year subscription cost and the rest of the cost of running the network is offset by advertisements.  Much like a magazine (bad example, since this media is dying a slow death) is paid for, it is also subsidized with ads.  Have you ever compared the cost of subscriptions between Time magazine and a trade journal with no advertisements?  It’s night and day.  Instead of paying $3.25/mo, you are paying about $100 or more per issue.

    Personally, I have never paid more than about $35/year due to various bargains throughout the years.  With the new family pricing plan, it now averages out to $33/year per person.

    The ads in the new dashboard are no larger than they were in the other system.  It’s just made more obvious, since the other blocks are smaller in comparison.  From what I can see, there are FEWER ads in the new system, since they combine many of them into a single large block.

  • Anonymous

    Narco, the problem is that there are ads in more places, and therefore Microsoft is selling more impressions.  We see the ads much more frequently than we did in the old interface.  Just as the new update caters to Kinect, it also caters to advertising.

    Also, your magazine comparison falls apart given that Microsoft gets its revenue by selling console systems, selling videogames, and collecting licensing fee from third-party developers, much like Nintendo and Sony, both of whom offer online functionality without charging me a subscription fee.

  • Anonymous

    I’m not a huge one for defending Microsoft, but I don’t know that there has to be this bright line in the sand between subscription-based and ad-based models. For example, I pay for cable/satellite TV, and yet there are ads!

    As you say, the industry is hashing out different revenue models, and Microsoft is pushing the boundaries a bit to see how they can maximize their revenue – I don’t think they owe us all a refund or anything. As long as they aren’t actually putting up roadblocks between me and my game, on-screen ads don’t bother me.

    For me, the bigger issue is that as far as I can tell, XBL is really not worth paying for, so throwing up an ad in the corner of the home screen is far less of an outrage than the fact that I pay $60 for XBL Gold to begin with.

  • EHX

    I don’t own a 360, but is that screen the boot up screen for the xbox360? Or do you have to sign into live? I ask because I see the open tray option.

  • Barac Wiley

    Yeah, there are definitely precedents in other media for services that are funded by both advertisements and subscriptions at the same time. That said, it’s a model I’ve never liked at all and I’d be happy to see that kind of split on internet services. Or at the very least, offer some option to avoid the ads. I refuse to pay for Hulu Plus precisely because it doesn’t remove the advertising, for example.