Microsoft’s $60 Netflix Tax/Toll Sucks

XBox 360

I’ve had a Microsoft Media Center set up in my home now for several years. I’ve got a media center PC in the basement which is connected to three XBox 360 extender units. One in my bedroom, one in my sons’ bedroom and one in the living room. These units stream OTA HDTV that I get from a TV Tuner. They also stream my music and photos. I like this functionality with my XBoxes.

I also use the DVD drive in my XBoxes to play movies that I get from my Netflix subscription.

What I don’t do with my XBox 360s is play games. I have no time for video games. I’m trying to publish a million photos before I die. When I’m not spending time with my family or shooting or processing or doing other internet stuff, I’m definitely not gaming. My kids play games a little, but even then they are not *that* into it, they certainly don’t use XBox Live. What we mostly use our XBox 360s for is for streaming media in our home. And while I understand that this is not really the primary reason why this device was created, they work well for this generally speaking.

One thing I *hate* about my XBoxes though is that Microsoft forces me to have an XBox Live Gold account in order to stream my already paid for Netflix content. Sony Playstation doesn’t require an XBox Live Gold subscription to stream Netlix. the wii doesn’t require an XBox Live Gold subscription to stream Netflix. The Roku doesn’t require an XBox Live Gold subscription to stream Netflix. Apparently there are tons of other devices, blue ray DVD players, etc., none of which require a tax to stream Netflix. I’m guessing that the new streaming options on the upcoming Google TV and Apple’s new revamped Apple TV aren’t going to require an XBox Live Gold account either.

It seems like Microsoft is the only company that wants to screw over Netflix subscribers. So why does Microsoft insist on boning me $60 a year to watch the Netflix that I already pay for on their device? They were charging me $50 a year to watch my already paid for content but then two days ago I got this friendly greedy email from the XBox Live Team rubbing salt into the wound letting me know that they were going to start charging me even more:

Dear thomashawk22:

Thank you for being a valued member of Xbox LIVE Gold. We hope you are enjoying the many exciting and exclusive features that are included in your membership. We wanted to let you know about an upcoming price increase for your Xbox LIVE Gold subscription and how you can lock in your current price to continue enjoying everything you’ve come to love about Xbox LIVE, plus all the upcoming additions, including ESPN and Hulu Plus.

Besides launching the new features and titles, we will also be increasing the price of Gold membership on November 1, 2010. The new prices are as follows:

Old Price New Price

1-Month Gold Subscription $7.99 $9.99

3-Month Gold Subscription $19.99 $24.99

12-Month Gold Subscription $49.99 $59.99

If the renewal date on your current subscription is on or after November 1, 2010, your subscription will automatically renew at the new price, charged to the credit card we currently have on file for your account.

In my case, I’m generally happy with using the Microsoft Media Center platform to consume media in my home. But I’m not happy about paying a Microsoft tax in order to consume already paid for content.

So I won’t be renewing my XBox Live Gold account. I want to put my XBox 360s up for sale on eBay, but first I have to figure out a better overall media streaming strategy for my home. I’m hoping that Google TV will actually do a lot of what I’d like to do as my life seems to be moving more and more to Google products anyways.

I might even be able to put up with Microsoft’s lame $60 tax except for the fact that they insist on charging me $60 per year for each unit. Yes, that’s right, $180 per year to consume paid for Netflix content on these devices. This greedy move on Microsoft’s part is short sighted. I’m sure I’m just a blip on the radar and they probably don’t care one iota about screwing over home media non-gamer enthusiasts with their tax.

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  1. Geoff Weinhold says:

    For what it’s worth, MS will be offering a Xbox Live Family pack for $99.

    Still sucks though. I’ve dropped cable/satellite so I’m holding on as well to see what the new Google or Apple solutions are coming.

  2. Eric Leslie says:

    I wasn’t aware they were hiking prices, but I dropped my gold membership this month for the very same reason. I don’t have cable/sat service either, so I’m looking into other tech much like GoogleTV or several other Mediacenter PC type options.

  3. Thomas,
    Using the Xbox just for Netflix (instead of gaming) and complaining about the tax hike is like using your car just for its air conditioner (instead of driving) and complaining about gas prices going up.

    Buy. A. Roku.


  4. admin says:

    Jeremy, sometimes I like my car nice and cool while it’s parked in my driveway and I’m surfing the web. 😉 But it still doesn’t cost $60 in gas to run your car’s airconditioner while parked.

    The fact remains that the XBox 360 is the *only* device to charge you a tax/toll to consume content you’ve already paid for.

    I can buy a roku, but then that’s one more device to have to buy and one more box to clutter up my life. The roku doesn’t have a DVD player either and I still need one of those. Plus the roku can’t stream my OTA TV.

    I’ve got to figure out a better strategy because no way I’m paying Microsoft $180 per year — I’m hoping that Google TV might be more to my liking. I wish that would hurry up and come out. Anyone know how to get on a beta for that thing?

  5. Groovymarlin says:

    Can’t say I’m all that surprised, but it still sucks. If you truly don’t use your Xbox 360 to play games, get rid of it by all means. I highly recommend the Roku. I just got one, and it is SO awesome. It connects to so many services – Netflix, Amazon Video on Demand, Flickr, Pandora, Vimeo, and a whole bunch of little niche channels as well.

    You can get a Roku with wireless, so you don’t have to use one of your ethernet connections. Mine is wireless (I got it refurb on Woot) and it works great. Of course, if you were playing DVDs on your 360 then you’ll need to get a new DVD player, but they’re so cheap nowadays it’s laughable. Plus, with Netflix etc. available through my Roku, I find that I hardly ever watch DVDs anymore.

    Good luck. 🙂

  6. Groovymarlin says:

    Oh and I forgot to mention – in terms of clutter, the Roku is not much. It’s very, very small. About the size of an external hard drive or a paperback book.

  7. Rob-L says:

    To be fair, Xbox Live was around before they started offering Netflix streaming and was specifically for game play and acessing MS content. Netflix is an add-on to the original product, so technically, they are not charging you for accessing Netflix content.

    That said, I’m not publishing one million photos, so I do have time for gaming. 🙂 But I find the price to play online too high. (Even before the price hike.) Playstation and Wii don’t charge for online game play. Microsoft claims that the cost is associated for the content they create for XBox Live. Personally, I’ve never watched any of their content. I just want to play games and occasionally stream a Netflix movie. If they were smart (and less greedy) they’d offer a Silver account that denies you access to their special content but gives you access to online play and Netflix streaming for free (or at least cheaper).

    Also, if you buy a 1-year XBox Live Gold account through, you can get it $10 cheaper. Hopefully that will still be true after the price hike. (I know, WalMart – boo, hiss. Whatever)

  8. Kindofsaidityourselftheirchief says:

    Kind of said it yourself there chief – it’s not a media streaming device, the fee is for xbox live gameplay, which is what the GAMING system is for.

  9. Blod says:

    No matter how clever they make the pitch Apple is always the most expensive – it’s part of their culture, but they are very good at making victims feel grateful for being relieved of all that money.

    You might get lucky with Google though…. but you might not !.

  10. Thomas Hawk says:

    @Kindofsaidityourselftheirchief, if the fee is for XBox live gameplay, then the fee should be for that.

    For MSFT to lump Netflix streaming, very specifically *non-gameplay* functionality, into a gameplay package they alienate those who don’t do the gaming. The device has also been pitched as a media center extender. To the extent that Microsoft wants to charge you $60 per year to watch content you’ve already paid for it fails in that regard. There is no reason why MSFT can’t let you stream Netflix without buying a gaming package. Every single other device, even other gaming devices, have figured this out.

    Netflix streaming has absolutely nothing to do with gaming and shouldn’t be used to try and strong arm you into a gaming package that you don’t want, don’t need, and certainly don’t want to pay a $180 per year tax for.

    I probably misunderstood Microsoft’s lack of commitment to home media when I went the route with the XBox 360s as extenders in the first place.

  11. Rob says:


    I don’t understand why you are paying $180! Buy an Xbox memory card and put your Xbox Live Gold account on it. Then when you want to watch Netflix, just move the memory card to whatever Xbox you are watching it on. No point in paying for extra Xbox Live accounts. Also, you can only watch 1 stream of Netflix at one time… 2 people cannot watch on the same Netflix account. This is even more reason to be only paying $60. A memory card is $20 so I would look into that right away.

  12. Josh says:

    Yeah, Xbox live is an all inclusive service. If you’re only using one part of the service, why pay for the whole thing? Pay someone else to deliver your content.
    Here’s the thing: Xbox Live start and a game match making service and has rapidly evolved into a multifaceted service. It still does match making, but it has many many many other features tacked on, one being netflix. Granted, their netflix implementation is better than others, but it has features you don’t care about, so get rid of it. It’s like you bought a Ferrari when you just needed a bicycle. For the price of a 360 you can build a small for factor PC with a TV tuner and get everything you want. Granted, it’ll take a little work to get all the features you want to use lined up and easy to access, but that’s why you pay for a service in the first place. So someone else has to do it for you.
    And the live price hike has nothing to do with netflix. It has to do with the ever expanding features that keep getting added to Xbox Live.
    Also, buy three gold accounts seems incredibly silly unless you’re using the other live features all at the same time. It seems that you’re just mad because everyone else is mad about a, what 10 dollar a year increase?
    For you it seems like it’s a laziness tax. There’s always a cheaper way to do things. It just might take a little more work.

  13. Rob says:

    I’d def get an Apple TV over the Roku. Apple TV does many other things to and I’m sure they’ll be adding more to it in the future.

  14. DWAnderson says:

    You can do Netflix streaming through Media Center to the Xbox without paying for Xbox Live. I do this via a PlayOn server application installed on my Media Center PC and addin software for Media Center (which works on extenders).

    The interface is not as elegant as the Netflix support in the Xbox dashboard, but it works reasonably well. It also gives me access to a variety of other internet video sources such a Hulu.

    I am not sure what the prices of these applications are now, but I purchased them in the past yeat and they were less than $50 total.

  15. Sounds like it’s time to reconsider a TiVo. The new premiere DVR can do everything that you ask for except DVDs and those are easy enough to get around by ripping your DVDs when they arrive in the mail and then streaming them from the TiVo itself. I bet that it would be easy to find a couple of used lifetime series 2 tivos (if you don’t care about HD on all the TVs) or series 3 TiVos on ebay that you could use are your extenders. The killer app with TiVo though really is the OTA HD. If you can cut out Uverse and go internet only w/ Comcast. The savings would probably pay for all three systems in less than 6 months. I’ve been cable TV free for over 6 months myself and you know how much I love my TV.

  16. Groovymarlin says:

    You know there are certain models of Blu-ray players that have Netflix streaming support built in, right? That’s one other route you might consider. Netflix provides a list of all their supported devices here:

  17. Zak says:

    A bunch of Windows Media Center Embedded devices coming out:

  18. Mike says:

    vmcNetflix plug-in for Vista Media Center seems very promising. I haven’t tried it yet, but may do so this weekend.

  19. Bill Bob says:

    Listen, if you don’t like paying $60 a year for Xbox Live go get a PS3, you’ll see why Microsoft charges. It’s a better online experience, plain and simple. If you’re not using the service as it is intended, then either suck it up and continue using the Xbox 360s for streaming and DVDs, or go buy 3 DVD players and 3 Roku’s. Done.

  20. Thomas Hawk says:

    Bill Bob, I’m in the process of getting rid of the XBox 360s right now. I think I can get 50 bucks each for them. I replaced them with AppleTVs.

    Goodbye Microsoft, hello Apple! 🙂