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Is That $99 Xbox 360/Kinect Bundle Really A Good Deal?

This article is more than 10 years old.

Kinect for Xbox 360 logo (Photo credit: Wikipedia)

It turns out that the rumors were true, and Microsoft has indeed released a $99 Xbox 360 console and Kinect bundle tied to a two-year Xbox LIVE subscription. It's seems like an awesome deal. After all, you get to walk away with a brand new Xbox 360 and Kinect having only put down $99.

What could possibly go wrong?

Well, there are a number of things you should be aware of before signing on the dotted line.

The first thing that grabbed my attention while scanning the terms and conditions document for the Xbox 360 console bundle is that there's no mention of extended warranty being part of the agreement -- something which had initially been rumored. This means that Microsoft's standard warranty applies to the console and Kinect hardware. This means you get one year of cover for the console, and 90 days cover for any accessories.

In real terms, this means is that if your console dies after a year, it will have lived as long as Microsoft expected it to. It also means that you're lumbered with having to pay for another 12 months of Xbox LIVE subscription, or pay the early termination fee -- which after a year would still be $132.

Another thing to bear in mind is that you need to keep your Xbox LIVE membership in good standing for the entire duration of the subscription. Let me draw your attention to the conditions that can trigger the early termination fee. One in particular I've highlighted in bold.

10.  EARLY TERMINATION FEES.

An Early Termination Fee ("ETF") is a charge made to your credit card if any of the following occur:

- If you do not return your Console Bundle during the 30 day Return Period, and you cancel your Subscription before the two year term ends;
- If you fail to provide an on time, full Subscription payment and we are required to cancel your Subscription; or.
- If you violate the Xbox LIVE Terms of Use, resulting in termination of your Xbox LIVE membership.

This means that if, for any reason, your Xbox LIVE membership is terminated, the early termination fee becomes payable immediately. Most people think that as long as they play nicely with other players and don't mod their console, their account is safe. While this is true most of the time, it's not always the case. I've come across countless tales of woe from gamers who say their Xbox LIVE account was either cancelled for not good reason, or cancelled accidentally. And in my experience of helping people in such situations, it can be really difficult to get a cancelled Xbox LIVE account reinstated.

Another factor to consider is that you're entering into a two-year contract over technology that's already six and a half years old. By the time you'll done paying for it, your gaming platform will be eight and a half years old.

Not only do you have to think about the age of the platform, but with rumors of an update starting to take shape, it's quite possible that the new Xbox 720 -- or whatever it ends up being called -- could be a year or so away. While you shouldn't base your purchasing decisions on rumors and speculation, it's certainly something worth considering.

One of my biggest worries about people getting into the Xbox ecosystem at this point in the hardware's lifecycle is that we know nothing about how backward compatibility the Xbox 720 will be with Xbox 360 titles. Compatibility with original Xbox titles was handled on the Xbox 360 using an emulator, but support was patchy at best, and there were a lot of glitches and problems.

Finally, let's not forget that you're paying extra for the privileged of spreading the cost of the console over two years. How much extra? Let's do the math (prices based on best deals found on Amazon.com and include shipping):

  • Xbox 360 4GB + Kinect: $280.96
  • 2 x Xbox LIVE Gold cards: $96.00
  • Total = 376.96

Compare this to the $99 plus 24 payments of $14.99 for the bundle, which works out at $458.76. This means that you are paying a premium of $81.80.

I don't want to give you the impression that getting an Xbox 360 and Kinect bundle for $99 bundle and two-years worth of Xbox LIVE subscriptions is a bad deal. It's not. But as with any deal that pushes the total cost of an item into the future, you do need to be aware of what you're getting yourself into before you sign on the dotted line. You especially need to be aware of the circumstances that could result in you having to pay Microsoft the early termination fee, because this could be a few hundred dollars that you didn't expect you'd need to find.