Will the Xbox 720 Offer a Subscription-Based Pricing Model?

By | 4 years ago 

While it was only earlier this year that Microsoft unveiled its new subsidized Xbox 360 pricing model — which allows patrons to procure the console for a lower retail price, but ties them into a monthly subscription plan — and it’s only currently expanding past the test phase, it appears that the option might be here to say. More than that, though, it looks like Microsoft might be keeping the subsidized pricing model for future Xbox generations.

For those that might not be familiar with the offer, it essentially provides anyone interested in an Xbox 360 the opportunity to purchase one for $99, with the one caveat that they agree to a $14.99-a-month charge for Xbox Live for two years. Any who purchase the console must first undergo a credit check, but once approved they can get a 4GB Xbox 360 and Kinect for the cheaper price.

At first this appears like a rip-off considering an Xbox Live Gold subscription costs $59 a year, but it’s the ability to push off the immediate payments that is the real draw. Let’s face it; even though consoles are coming down in price with every shopping season, they’re still an extremely expensive proposition. But what if with the next generation they didn’t have to be?

That’s what Microsoft General Marketing Manager Matt Barlow is suggesting could happen with the Xbox 720 — a more affordable subscription model that alleviates the initial sting of new console price points. While his claims don’t suggest this subscription-based pricing model will be the only way to purchase the next Xbox, he does say the option is here to stay, and is “pivotal to [their] business.” Meaning that if it gets the console in the hands of more consumers faster, then Microsoft is willing to try it out.

And for those that have yet to take advantage of this ‘Entertainment for All’ Plan, Microsoft has announced several new options for this holiday season, including a 250 GB Xbox 360 with Kinect for $149.99. At the moment, these specially priced consoles are only available in Microsoft stores (of which there are very few), but pretty soon the plan will be expanding into major retailers like GameStop, Best Buy, and Toys ‘R Us.

The expansion begins on October 28th with GameStop and expands to five total US retailers by November 2nd. For full details make sure to check out Major Nelson’s post on his official blog. As far as an Xbox 720 price point or subscription option are concerned, look for major announcements to be made at E3 2013.

Do you think it would be smarter for Microsoft to offer the Xbox 720 with this subscription model to make the price point seem more affordable? How expensive do you think the next generation of consoles will be?

Source: Wall Street Journal, Major Nelson