- Created on 10 May 2012
- Written by GTL Admin
- Hits: 635
Microsoft is ripping a page from the cell phone "lock you in" play book by introducing a contract based Xbox 360 promotion. What you get is an Xbox 360 4GB console with the Kinect Sensor for a mere $99. Wow, what a deal!!! The catch is, and there's always a catch with Microsoft, you have to sign up for a 2 year Xbox Live Gold membership for $14.99 per month. Like a cell phone contract there's even early termination fees.
The $99 price tag looks pretty attractive at first when you consider that the same system retails for $300 as long as you don't look at the $14.99 2 year membership fee that you're locked into. So, is it a deal or not? NOT!!! Well, maybe not.
First, let's look at going to the local brick and mortar store and slapping down 300 dollars (plus tax) and then going home and logging onto Amazon to pick up one of thier Xbox Live Gold membership deals for $30. Don't forget you have to renew for the second year so that will be another $30 for a grand total of $360 over the same two years that you're locked in for the deal.
Now, let see what it really costs for the Xbox 360 promotion. OK, $99 sound great - that's a good start. Then a month goes by and it's time to pay the man the $14.99 per month subscription fee. Wash and repeat for 24 months so let's add that up.
$99 initial cost
$14.99 X 24 = $359.76
For a total of $458.76
That makes the contract based Xbox 360 promotion $128.76 more than a purchased system. Now how does the deal sound - not so good any more?
That's also 28% non-compounded interest over two years as well if you want to look at it like that.
Don't go thinking that you can cheat the system either as Microsoft has a full up rock solid Terms and Conditions For The Xbox Console Bundle/Xbox LIVE Promotional Offer vetted by a team of 100 lawyers locked in a converence room for a whole weekend. Basically, the terms state that if you terminate early it will cost you just the same anyway if you kept it for the whole term.
Guess what happens if you want to persue binding arbitration or jump into small claims court? Nice try. It would make for a great article though; just think - Johnny game player vs. 100 Microsoft lawyers. How will they all fit in the court room? Someone should try it just for the fun of it.
Then again, we might be seeing a few Microsoft lawyers for laying out the facts here.
What about the maybe not? If you're low on cash and can't afford to lay out the $300 retail system price and $40 1 year Xbox Live Gold membership then this deal just might be the ticket. However, you'd be better off getting a long term loan from Grandma - just don't sign any contracts with her.