I think it's possible that at least Microsoft will offer a contract version of the 720 with a 2 year Live Gold subscription, and initial low cost. $199 with 2 years of Live service, or something like that. This would probably be appealing for at least some. Sony may offer something similar with a 2 year contract on paying for PS+. It's a way to get the latest and greatest at an initial low cost, and a kind of loan with benefits. I.e. going the cell phone route - reduced price with contract.
This. I think MS will definitely do this. I've had people disparage me and tell me I'm stupid/an idiot and that its a huge waste of money for consumers. This is cheap ass gamer. We aren't the normal consumers and people coming here with the assumption this is how most people buy is a mistake. I'm sure they'll do a subsidized console and I wouldn't be at all surprised to see a lot of people willing to pay more over 2 years. It's not THAT bad anyway.
If you assume that the average consumer gets a year of live at $40 (which I doubt), that's $480+tax. To buy outright with a discounted live membership.
The you have:
200 + tax + 360 (15 * 24) = 560 + tax.
480 vs 560 - most states have sales tax between 5 and 10%.
Even if you assume only 5% sales tax on the subsidized console:
Including tax it's $500 vs. $570
So assuming the consumer gets 2 years of memberships at 40 a year instead of 60 and that their sales tax is only 5%, anyone that wants the console and will already want XBL will only be paying $70 more over 2 years to pay $200 less up front. I bet a lot of people do that. Most wont even do the math.
If they live someplace like FL with 10% sales tax and they regularly pay $60 for their annual membership, this only costs them $10 more and would be a no brained.
I think this forces a $100 price drop on the Wii U.