Microsoft to Offer Xbox Subscriptions at Best Buy, GameStop

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By Ian Sherr and Steven D. Jones

Microsoft Corp. plans to boost the number of outlets offering its subscription plan for the Xbox, an effort to attract more users by lowering upfront costs of acquiring the game console.

The company, which had previously only made the offer available through 17 of its own stores, plans to extend its $99 offer—which combines a Xbox 360 and Kinect motion sensor with a two-year service contract—to all U.S. Best Buy Co. stores and a “select” grouping of GameStop Corp. stores.

Microsoft said it still regards the program as a pilot, adding that the stores will offer the deals to a limited number of users for a short period. If there is enough interest in the program, it may once again expand, the company said.

The subscription approach upends typical pricing models for videogame consoles, under which customers typically purchase the device for a higher price and would choose whether or not to pay for additional services. The Xbox and Kinect package retails for $299, while the company’s Xbox Live Gold online service regularly costs $60 per year.

Under the $99 subscription offer, customers agree to pay $14.99 per month for two years of access to the Xbox Live network, which allows gamers to play games with one another, watch streaming videos and access Netflix Inc.’s service, among others.

Don Mattrick, head of Microsoft’s gaming business, said customers have so far responded well to the new pricing program, though it is still in its pilot phase. He noted that sales have risen among both core gamers and more casual customers as well.

 

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(Published June 5, 2012, on The Wall Street Journal website.)