Xbox Live Gold Is Still One of the Biggest Ripoffs in Tech

A lot of mud has been slung Microsoft's way this week, much of it deserved. Used game restrictions, mandatory internet check-ins; these new impositions don't sit well. But they also distract from the single worst thing about the Xbox One, which was also the single worst thing about Xbox 360: The tyranny of Xbox Live Gold subscriptions.

There's zero question left how Microsoft views the Xbox One: It's your home media hub, a set-top box that also happens to have Gears of War. The company's own promotional site doesn't mention games until very last, as an afterthought, like a creepy uncle you'd reluctantly introduce to your fiance. Master Chief has taken a back seat to Skype.

And as a set-top box, it's actually pretty great! Hulu Plus, Netflix, MLB.tv, Amazon Instant Video, Last.fm, Crackle, ESPN, NBA League Pass. You can hook it up to your (approved partner) cable box to watch live TV. The dashboard interface is clean; Kinect 2 is the most futuristic way to channel surf. You can even, finally, watch your Blu-ray collection.

In fact, if you want a single, connected, do-everything box in your living room instead of stacks of plastic and Gordian cords, the Xbox One is impossible to beat. It's even worth the markup over a Roku or Apple TV given the sheer breadth of what it can do. Or it would be, if it weren't for the albatross of redundancy that is your annual $60 Xbox Live Gold subscription.

What is it, exactly, that you're getting with Xbox Live Gold? The right to access services that you already pay for. That's $96 each for Netflix and Hulu Plus, $125 for MLB, $79 for Amazon Prime, and on and on down the line. It's like booking a hotel room and being charged separately to sleep on the bed. It's a cover for a club you already paid dues for. And Microsoft is literally the only company that does it.

It's true that your Xbox Live Gold account also includes gaming, as it should. Microsoft's online gaming community—and, importantly, support staff—are without parallel. It's a unique offering, it's added value, and it's certainly worth paying for. It also explains why the all-encompassing Xbox Live Gold account exists in the first place; just a few years ago, Xbox Live constituted online gaming with a few apps thrown in on the side.

That's not the Xbox One experience, though. At least not by Microsoft's own reckoning. Content is king, games are secondary. So why not evolve the fee structure along with the platform? Go ahead and charge a monthly fee for online gaming; most of your existing customers will probably go along with it. Especially since Live Gold now comes with two free games a month, much like PlayStation+. But it's not the gaming value that's at issue; just leave the services we're already paying for—that, again, literally everyone else in this business offers for free—out of it. Especially when your direct competition is doing just that.

Yep, that's right. While the PS4 doesn't offer nearly as robust a streaming content offering as the Xbox One, its masters did have the common sense to continue offering its video apps for free, even as it introduced an online multiplier monthly fee. You might not feel satisfaction with Sony, but at least you'll feel respect.

Are there more expensive ripoffs in tech? Sure, just ask anyone who's spent more than ten bucks on an HDMI cable. But it's hard to think of one that has affected more people over a longer period of time. It's also not going away any time soon; when we asked Xbox execs about separating video services out from Xbox Live Gold, we were met with deep dismissiveness.

What makes that intractability so frustrating is that Microsoft's vision for a connected living room is actually a beautiful one. I applaud it. I want to live in it. But until it stops charging me for things I already pay for, until it fills in the moat it presumes to build around other people's castles, it's always going to be like most glimpses of the future: tantalizing, but tainted by overreaching. In this case, towards your wallet.

Additional reporting by Casey Chan