Xbox 720 subsidized pricing model, pros and cons

Having already explained how sales of the Xbox 360 have stalled in recent months and how Microsoft need to release their next-gen Xbox sooner rather than later, there has been a growing realization that Microsoft will adopt the subsidized pricing model for the long term. We already had a strong feeling it was coming, and when the company unveiled this very thing with the 360 earlier this year – well it was a sign of things to come.

Like all things there are pros and cons, and this is no different. While it may look like a rip-off at first, there will be some gamers who would look more closely into things and suggest that it doesn’t seem that bad. Some gamers will look at how much a subscription would cost and then have to also include the cost for the console itself. Currently the base Xbox 360 will cost $99 and $14.99 per month for Gold instead of the one-off charge of $59. The total cost then would be $278.88, which is far more expensive. This seems bad at first, but not for those with less disposible income, but let’s be clear of one thing, the pricing model for the next Xbox will be far more expensive.

Microsoft has said that they would like to make the next-gen Xbox more affordable, but stopped short in saying what these prices would be and if a subscription-base would be the only way to get a new console. However, he has said that this option will stay because it will make the next Xbox more affordable.

We can certainly see how attractive it looks, and such an option works well for the smartphone market. However, the two are very different beasts and could anger a lot of gamers. Having said that, it could be good to have a choice and we believe that Microsoft would not just offer a subsidized pricing model because they could lose sales and alienate many young gamers or those with bad credit.

If you have a bad credit score then you’re not likely to get a subscription, neither will young gamers who would have to persuade their parents instead. The biggest obstacle that Microsoft will have to overcome is persuading gamers that paying more for their console overtime instead of buying upfront is the right choice to make.