Why do people pay for Xbox Live?

[Keith Reedy]

OP fails to realise that the cost of something is not determined by the resources it requires to produce, but rather by the demand for the product itself.

People pay for Xbox Live because they like Xbox Live. The fact that Microsoft is externalising costs doesn't change the fact that if you want to play online with an Xbox, you have to pay for Xbox Live. Further, the benefit you as a subscriber derive from paying for Xbox Live is not substantially different regardless of who provides the resources for the service. Microsoft is just leveraging its licenses in an extremely sensible way. Virtually any business in the same position would do the same thing. Note here that Valve is not in the same position as it doesn't hold any sort of hardware monopoly over the devices that run the games sold on it.

My father used to complain about burritos with too much rice or beans in them because "rice and beans are cheap". But the argument makes no sense - either the burrito is good or it isn't. Its value to you is not necessarily equal to the value of its constituent parts to you let alone the resale value of its constituent parts.

TL;DR: Your refusal is based on a very naive understanding of economics.

The online store is what costs Microsoft money to run and they offer that up for free to Silver members. If you wanna play COD online, you already payed for that when you bought the game, why would you pay Microsoft to play COD? They incur no cost whatsoever from you playing COD.

Your burrito analogy doesn't make sense, a better analogy would be your dad buying a burrito from Taco Burrito King (real place) and also paying Taco Bell $1 for some reason; Taco Bell did not have anything to do with the making of that burrito yet you are giving them money, why?

Everything I'm about to say is completely factual.

Well, if it's completely factual, where are your sources?

Peer-to-peer networking (how online gaming works):
http://en.wikipedia.org/wiki/Peer-to-peer

Here's the Xbox live Silver/Gold breakdown:
http://en.wikipedia.org/wiki/Xbox_live

Tell me which Gold services aren't FREE everywhere else.

Holy cow actual sources! I am amazed! To bad you can just put whatever pleases you on wikipedia.

What information for those pages do you think is not factual.

And, yeah, I just went and edited those wiki pages to make my point seem right.[/sarcasm]

I was just being a pain. Seriously you're wastin your time here, people gonna buy whatever they please. PSN will cost money one day soon as Sony feels they can get away with it and as soon as a company can charge for computer online play it will cost money too. You're not changin anyone's mind. The only thing you have accomplished is a successful flame bait thread.

 

[Jaime_Wolf]

The online store is what costs Microsoft money to run and they offer that up for free to Silver members. If you wanna play COD online, you already payed for that when you bought the game, why would you pay Microsoft to play COD? They incur no cost whatsoever from you playing COD.

How did you pay to play CoD online when you bought the game if buying the game didn't allow you to play it online without paying more? Maybe you have some personal feeling that online play should have been included with the purchase, but that doesn't change the fact that it wasn't. Your whole argument seems to rest on some version of economics where it's unjust for companies to turn a profit (they should only charge for things that cost them resources to provide) and where price shouldn't be determined by demand, but rather by resource costs. That's what I meant when I said it was a naive understanding of economics.

There's also the fact that Microsoft's gaming division does have costs to cover. They consistently sell hardware at a loss, so they need licensing and subscriptions to recoup those expenses. Similarly, the hosting for benefits afforded Silver members isn't free, so again they're providing cheaper entry and recovering those losses by charging for additional services. They're making it cheaper for people to get into gaming and buy hardware and they need things like this to make up for it. What jerks.

Your burrito analogy doesn't make sense, a better analogy would be your dad buying a burrito from Taco Burrito King (real place) and also paying Taco Bell $1 for some reason; Taco Bell did not have anything to do with the making of that burrito yet you are giving them money, why?

It's not the same situation, no. I only mentioned it because it was based on a similarly naive idea of economics and your post reminded me of him.

A more apt analogy would be going to Taco Burrito King (that's seriously the name of a real place?) to buy a burrito made by Taco Bell and paying Taco Burrito King a dollar because it owns the taco distribution building despite all of the ingredients and the work being from Taco Bell.

 

[mrdude2010]

Well, we pay to not have our information stolen >.>

<..>

this. microsoft does pretty well at keeping our info safe


although it really does piss me off that they try to make us pay for player servers. i would happily pay for XBL gold if they had dedicated servers. as it is i like playing online, so I currently pay for XBL when i can afford it, but it is seriously stupid that they try to get us to pay for online gold

hacked.

twice.

how's that safer?

googling things like 360 hacked or whatever doesn't really get me anything aside from "microsoft banning hacked consoles" so i would like to see the link that demonstrates this, as i have had a card connected to a live account and had nothing hacked

 

[Phoenixmgs_v1legacy]

Third party developers dont pay to have there game on XBL for download They do on PSN (This includes demos and much more stuff)

That benefits you how? The prices are the same on both systems for the same games.

XBL has faster speeds and less down time then the PSN

PSN downloads stuff pretty damn fast (1MB/s) at my friend's place who has a good cable connection. I don't know the top download speed for PSN or Live, but PSN isn't SLOW.

XBL has more features as well as more users

Both have plenty of users to find and join online games quickly.

XBL has cross game chat

Not something I would use, but I'll give it to you. You pay $60/year for that, and the cross-game chat costs Microsoft barely anything since it uses peer-to-peer.

XBL has avitars (small but still there)

PSN has avatars. Live's are better but it's not something I would want to pay for.

XBL has its own security devision that is set up to catch hackers and cheaters and does nothing else other then that PSN does not (atleast not as big i admit that i was wrong on PSN not having that i wont lie to you)

Live has gotten hacked more than PSN. There is not one incident of someone using a PSN user's credit card due to this incident but there is several instances of that happening on Live.

But there are not alot of PS3s with backwards compadibility that like saying 99% of 20%

True, I'll give you that, Sony gave up with the BC but Sony's BC was better than MS's BC, several supported games according to MS, don't work. I do have a BC PS3 and I actually rarely use it but it's nice to have. I'd say, it's about even with BC as both are far from ideal.

 

[Arizona Kyle]

Prices are the same on both systems but because PSN charges for every download companys dont put as many games up for long periods of time unlike XBL

 

[masher]

Just look at the PlayStation Network and Live.That money goes places.

What about Steam?

Steam's a thing all their own.

The way I see it:
PSN's free, but the security's not as tight as it could be,
Live requires cash, but it's secure(I've never once had to deal with a hacked account nor do I know of anyone who has).

Steam... Like I said, "All their own." I've had my account hacked and I know of people who have had their's hacked, too, but Steam is really dependable in these situations. It didn't take long at all to get my stuff back and secure.

Steam just genuinely cares, I guess.

 

[Ryan Minns]

I think someone mentioned it but I was too stupid not to hit quote but it was answered

Person buys a 360, person wants to play online, person pays to play online

Microsoft charge because people will pay, people pay because Microsoft charges... that's basically it, what it provides and the fact it's free elsewhere means nothing, it's what you have to do to play online so people do it and they have every right to really, all that matters is they believe they get what they pay for and that's all that should matter

 

[Jegsimmons]

360 was $400 + $100 (2 years of Live at $50/year) = $500

PS3 was $500 + $0 for PSN = $500

Where are you saving money?

well for starters by the time the PS3 came out the 360 was about 50-100 dollars cheaper. plus we actually got a head set for online play, and GAMES for online play....and i don't use hd on my 360 (couldn't care honestly) and the PS3 is not the only games with backwards compatibility, i still played halo 2 on my 360 which was one of the best game for multi-player.

That $50 cheaper was then just an addition year of Live you would have to pay for. Like I said, if I did the price comparison now, it would be even more in PS3's favor. What online GAMES do you have that I don't? Are you talking about 1st-party games because the PS3 has more 1st-party online exclusive games, there's Warhawk, MAG, Killzone, Resistence, Uncharted, SOCOM, Metal Gear Online, etc., the 360 only has Halo and Gears. I'm sorry but almost every gamer needs more than the 256MBs or 512MBs a memory card allows for, DEMOS are bigger than that. PS3's backwards compatibility whether hardware or emulation-based is far better than the 360's backwards compatibility, 99+% of PS2 games are supported on any PS3 with backwards compatibility.

Mags was a complete disappointment, uncharted is bleh, never even heard of warhawk, resistance is ok, metal gear isn't that great, and killzone is the only one i like. so in my eyes, killzone would be the only game worth buying. And saying that the 360 only has games is basically ignoring that that is 4 games, 5 if you count halo 2. gears its self is about to hit 3. and if you want to count left for dead (even though its shared with pc) that 2 more. not to mention the arcade.
also, take a look: http://en.wikipedia.org/wiki/List_of_video_games_exclusives_(seventh_generation)#Microsoft_Xbox_360
thats what a little google/wiki search will help with, the list is almost equal in number.
and saying that your console has 99% of ps2 games is not something to gloat about, since for a short time a large chunk of what was going good for the console was living off the previous one's games, the 360 did that for a relatively short time. In fact alot of the ps3's games that are coming out for it are remakes of older play station games. And no one said a memory card was for holding demos, its for holding a persons saved games or account so it can be played on what ever xbox he or she choses.
so really but the time the ps3 came out with a good list of games ive already moved on, enjoyed live to where i feel like i want to fork over 50-60 dollars for 12 months,played halo (one of my favorite game series (i couldn't care less about the rob lifeld wannabes in gears))
played some good online matches on a well put together network with a good bit of customization and additional options. not to mention i have to say that the design of the 360 controller is an advantage for it, that and the fact the console its self is a lot easier to transport and isn't really frigging big and awkward as the ps3.

 

[Ridgemo]

Wow, you are still trying to tell us how to spend our money?!?!

I've never understood why people feel the need to force their opinions on others. Your just as bad as those fucking Jehova Witnesses that wake me up while i'm asleep.

What does it matter. People are willing to pay for Xbox Live. Therefore people pay for Xbox Live. The only person it affects is them.

 

[Choppaduel]

the same reason they buy an xbox360: because they're fools.
The post below mine goes a bit more in depth.
[hr]

OP fails to realise that the cost of something is not determined by the resources it requires to produce, but rather by the demand for the product itself.

Your confusing cost with price here. Cost is literally determined by the resources required to produce it. Price is how much people are willing to pay for it. In the past, consoles cost more than people were willing to pay for them, so they lowered the console price below cost, and regained this loss by raising the price of games. Once you have the console, you're likely to buy games for it, after all.

 

[Vault boy Eddie]

For the same reason dudes pay women to stand on their junk with high heels on? I mean, who wouldn't want to pay to have some random kid that isn't supposed to be playing mature rated games calling you names and having people mic spamming, making you have to mute everyone instead of, oh I don't know, acting like humans. If i'm gonna have someone call me a N-word, i'd rather not have to pay for it.

 

[Phoenixmgs_v1legacy]

How did you pay to play CoD online when you bought the game if buying the game didn't allow you to play it online without paying more? Maybe you have some personal feeling that online play should have been included with the purchase, but that doesn't change the fact that it wasn't. Your whole argument seems to rest on some version of economics where it's unjust for companies to turn a profit (they should only charge for things that cost them resources to provide) and where price shouldn't be determined by demand, but rather by resource costs. That's what I meant when I said it was a naive understanding of economics.

There's also the fact that Microsoft's gaming division does have costs to cover. They consistently sell hardware at a loss, so they need licensing and subscriptions to recoup those expenses. Similarly, the hosting for benefits afforded Silver members isn't free, so again they're providing cheaper entry and recovering those losses by charging for additional services. They're making it cheaper for people to get into gaming and buy hardware and they need things like this to make up for it. What jerks.

I know the hosting benefits for Silver members costs Microsoft money so then Microsoft should charge it's customers for the services they (Microsoft) are providing. Silver shouldn't be free then. However, online gaming should be free (for all 3rd-party games), there is no need to even have a Live account to play online other than your Live gamertag is used for you player name in the game. With a game like COD or Halo, I'm guessing at least half the resources that went into making that game went into the multiplayer so $30 of the $60 price tag is for the online multiplayer content. Now, if you don't have Gold, you can't access half of the game content you paid for. If COD and Halo were just 5HR single-player campaigns like they are now, they could charge $30 for the game and make the development costs back. Whereas a game like Mass Effect, that whole $60 you paid for the game went into the single player, which is why the campaign has so much more content than COD or Halo campaign.

Your burrito analogy doesn't make sense, a better analogy would be your dad buying a burrito from Taco Burrito King (real place) and also paying Taco Bell $1 for some reason; Taco Bell did not have anything to do with the making of that burrito yet you are giving them money, why?

It's not the same situation, no. I only mentioned it because it was based on a similarly naive idea of economics and your post reminded me of him.

A more apt analogy would be going to Taco Burrito King (that's seriously the name of a real place?) to buy a burrito made by Taco Bell and paying Taco Burrito King a dollar because it owns the taco distribution building despite all of the ingredients and the work being from Taco Bell.

Yeah real place, google map it.

I'll break it down as much as possible just so I get everything correct as well.

burrito = COD
Taco Bell (maker) = Activision
Taco Burrito King (distributor) = Microsoft

Microsoft didn't distribute or make COD in anyway. Microsoft has no hand in the online multiplayer when you are playing it. You are logged into Live but that isn't really required, it's just more of a convenience so you don't have to create an Activision account or something to play COD, which can easily be done and completely bypass Live even being a required element. It's like how PS2 online worked (and how PC online gaming works if not using Steam), there was no PSN so you logged in with your EA account to play Madden or whatever. There is really no need for PSN to play online games either, developers just set it up to use you PSN/Live ID so you don't have to create several different accounts (EA, Activision, Ubisoft, etc.).

 

[Katana314]

OP fails to realise that the cost of something is not determined by the resources it requires to produce, but rather by the demand for the product itself.

People pay for Xbox Live because they like Xbox Live. The fact that Microsoft is externalising costs doesn't change the fact that if you want to play online with an Xbox, you have to pay for Xbox Live. Further, the benefit you as a subscriber derive from paying for Xbox Live is not substantially different regardless of who provides the resources for the service. Microsoft is just leveraging its licenses in an extremely sensible way. Virtually any business in the same position would do the same thing. Note here that Valve is not in the same position as it doesn't hold any sort of hardware monopoly over the devices that run the games sold on it.

My father used to complain about burritos with too much rice or beans in them because "rice and beans are cheap". But the argument makes no sense - either the burrito is good or it isn't. Its value to you is not necessarily equal to the value of its constituent parts to you let alone the resale value of its constituent parts.

TL;DR: Your refusal is based on a very naive understanding of economics.

I actually don't disagree with what you're saying. Economically, Microsoft has every right to charge whatever people will pay for the service. I think the argument should be directed at people who pay for it, not at all bothered by the fact that they are paying more than it's really worth.

 

[Double A]

Well, like you said, Microsoft has to pay for Silver members. Might as well lock multiplayer unless you pay up. That's what a lot of people buy games for, so Gold pays for itself I suppose. The more pessimistic answer is "Because they can."

Well, we pay to not have our information stolen >.>

<..>

old joke is old

older meme is older


Capatcha: Mehls Hableem

 

[Phoenixmgs_v1legacy]

also, take a look: http://en.wikipedia.org/wiki/List_of_video_games_exclusives_(seventh_generation)#Microsoft_Xbox_360
thats what a little google/wiki search will help with, the list is almost equal in number.
and saying that your console has 99% of ps2 games is not something to gloat about, since for a short time a large chunk of what was going good for the console was living off the previous one's games, the 360 did that for a relatively short time. In fact alot of the ps3's games that are coming out for it are remakes of older play station games. And no one said a memory card was for holding demos, its for holding a persons saved games or account so it can be played on what ever xbox he or she choses.

...halo (one of my favorite game series)...

The 360 has more exclusives when you count arcade games (which is important to some) if I recall correctly (I'm not going to count the 360 game list and PS3 game list) but I feel normal $60 disc games are what people buy systems for? You bought a 360 for Halo not for some $10-$15 arcade game; I bought the PS3 for Metal Gear Solid 4 and the next Team ICO game, and so-and-so bought the Wii for Zelda/Mario/etc. Sony has more devs than Microsoft and Nintendo combined, that's why I bought a PS3 because I thought Sony had great 1st-party games for PS2 and Microsoft didn't have anything I was interested in outside of Bioware stuff (which is now on both systems) on the original Xbox, and Nintendo never has good 3rd party support. If I could only get one console, it was going to be a PS3, a Wii would come next, then a 360. I also got several other games that I love that aren't on 360: Warhawk, Uncharted 2 (Uncharted 1 not that good), Valkyria Chronicles, MLB The Show (I'm a huge baseball fan, The Show is so much better than 2K), and maybe a couple others I can't think of. The PS3 has more exclusives on the way than the 360 as well. The ONLY game I want to play that is only on 360 is Tales of Vesperia, it's on PS3 in Japan but not localized.

 

[philzibit]

You can see where the money is going when DLC for Fallout and COd get released early on 360.

That, and it IS more stable all around. When you pay for something, there is the incentive to maintain upkeep.

 

[Kakashi on crack]

I don't mind paying a reasonable subscription fee for a service I feel justifies it. What I am concerned about is EA, Activision or the other publishers trying to muscle in and individual games suddenly requiring additional fees on top of the basic subscription. They are definately pushing for that, and it will really drive the cost of gaming up if they get their way.

I think this has already happened with a few games. Can't remember which one to use as an example, but you have to buy a DLC pack for something already on the system to allow you to get past level 5 in multiplayer.

Personally... Meh. I could go into an array of arguements, but to put it bluntly: I could care less that I pay the equivalent of a combo meal at a fast food joint to get a month's worth of unlocked multiplayer and the like.

 

[Phoenixmgs_v1legacy]

You can see where the money is going when DLC for Fallout and COd get released early on 360.

That, and it IS more stable all around. When you pay for something, there is the incentive to maintain upkeep.

You do realize you are not paying Microsoft to get your games or DLC early, you would've got those games/DLC at the same time regardless, it's just that PS3 users get the games LATER. You are paying Microsoft money only to spite PS3 users and nothing else. No customer actually wins with timed exclusives, there's only customers that lose. Sony pays for timed exclusives as well, and I don't agree with them doing that either.

If Fallout is more stable on 360 it's just because the 360 is more like a PC and the game is just buggier on the PS3, not because Microsoft paid Bethesda or Obsidian money to make the game more stable on 360. The Fallout games are buggy on all systems.

 

[Sinspiration]

I pay because I own an Xbox 360. It's a logical, straightforward reason. the 360 is my gaming platform of choice, as are the consequences that come with it and I'm comfortable with them.

I'd do the exact same thing if I owned a PS3, but I dont *shrug*

 

[Jaime_Wolf]

-snip-

It's probably pointless to keep trying to explain the problem, but I suppose I'll give it one more go.

I'm not in any way disagreeing that it doesn't cost Microsoft anything to provide access to third-party servers (realistically, it does cost them at least something, but for the sake of argument let's ignore that). What I'm trying to get across to you is that the cost of a product is virtually never just a function of the cost of the resources required to provide it. The only thing that matters is that Microsoft has put itself into a position where it controls something you want. That is far and away the largest determiner of pricing and resource costs have little to nothing to do with it.

And developers don't just run their games through Xbox Live because it's convenient, they do it because Microsoft's license stipulates that they have to, which in turn allows Microsoft to charge for the service. Again, this has nothing to do with hosting resources and everything to do with licensing agreements.

And if maybe you understand what I'm saying but think that things shouldn't be that way:
(1) How do you propose we price things, as a function of resource cost alone? This would mean wholesale rejection of capitalism and abandonment of any notion that businesses should attempt to earn a profit.
(2) You should probably refuse to buy every product and service currently offered by any even moderately large business (honestly, most small business probably qualify too). You're objecting to Microsoft externalising costs and leveraging their properties via licensing agreements, which is just normal business practice.