Xbox Live Gold doesn’t need a price change. It just needs to disappear.

Microsoft had quite a Friday.

The fun started when the Xbox maker shared the news that Xbox Live Gold, a paid subscription service that primarily exists to let Xbox users play their games online, would soon cost more. By roughly double.

The particulars varied by subscription length, but the formerly $60 annual subscription was poised to jump to $120 for new subscribers (existing subscribers would get to keep the original pricing). I’m discussing all of this in the past tense because blowback over the course of Friday prompted an about-face from Microsoft.

During the Friday/Saturday overnight, Microsoft blasted out a pair of tweets reversing its decision and taking the added step of allowing free-to-play online games to work without a Gold subscription. (Previously, you’d still need a subscription to play an otherwise free game like Fortnite on Xbox.)

It was a commendably speedy backpedal, with Microsoft acknowledging right up front in the tweet-linked blog post that “we messed up today and you were right to let us know.” Hiking the price of Xbox Live Gold was a bad idea. But that doesn’t mean the subscription should still be sticking around.

There was a time, roughly a decade ago, when Xbox Live Gold made sense. Many games weren’t nearly as online back then as they are now, “free-to-play” as we know it wasn’t really a thing yet, and the price-vs.-performance gap between console and PC gaming was still intimidatingly wide.

So yeah, you could play the latest Call of Duty online for no additional cost if you did your gaming on a computer. But a $400 console plus a $60 annual subscription cost far less than the $1,000 or so you’d have to spend on a gaming-friendly PC. 

Things have changed in the past 10 years. Broadband access at home is more common and speeds are significantly faster. Console gaming has largely “caught up,” in the sense that games look and perform almost as well as they do on your average gaming PC. 

In all that time, Xbox Live Gold has endured as a pain point for Xbox-using console gamers. It’s still free to play PC games online and even use Xbox Live-specific features like party chat. But doing any of those things on Xbox requires that Gold subscription.

The inequity has started to seem especially glaring as the concept of free-to-play gaming has taken hold. Fortnite is perhaps the most glaring example, a game that’s supposed to be free but it’s not playable on Xbox without a Gold subscription. The recent news that the upcoming Halo Infinite is taking a free-to-play approach also had people grumbling anew about the continuing existence of Gold.

Then there’s Xbox Game Pass, Microsoft’s Netflix-like subscription which gives users unfettered access to a large library of games. It comes in a few different flavors, with separate subscriptions for console and PC. The one Microsoft would like everyone to sign up for, though, is Game Pass Ultimate, which combines the other two subscriptions into one while also adding in the benefits of a Gold subscription, for an annual cost of $180.

For comparison, individual PC or console subscriptions run at $120 annually apiece. So for an extra $60 you get the games library on both platforms as well as online play for your Xbox via Gold benefits. By hiking the price on standalone Gold subscriptions, Microsoft was implicitly pushing users toward Game Pass Ultimate. Why pay more for the same one thing when you could pay more overall  but less in the bargain for multiple different things?

That didn’t go over well at all, hence Microsoft’s reversal. But the fact remains that Xbox Live Gold is still kicking around as a relic of console gaming’s yesteryear. Both Microsoft and Sony still charge players for the ability to play their games online. Both companies add value to their respective subscriptions with monthly offerings of free games, but the primary benefit for most is the online play.

It’s justifiable to some extent. Consoles work like Apple’s walled gardens in the mobile space; they’re self-contained machines that are purpose-built for gaming, but that means you’re playing by their rules and on their infrastructure. That infrastructure costs money and the Xbox Live Gold (or PlayStation Plus) subscriptions of the world is what pays for it.

Even if that’s still the case in 2021 — it’s not like Microsoft and Sony are out here breaking down the numbers on why they still need to charge users for online play — it’s a tough case to make when all the same games are playable on a home computer without any need for an extra subscription fee. That’s the challenge Microsoft faces here: The company upped the price on a subscription that many already see as little more than a necessary headache.

That wasn’t going to fix anything, and it didn’t. Instead, the backlash opened Microsoft’s eyes to the root of the issues that many have with Gold. Not that the company wasn’t already aware. But the immediate negative response to Friday’s news was strong enough that Microsoft was finally compelled to act. Not only did the ill-advised price increase get dropped, but free-to-play games will soon work without a Gold subscription — easily one of the biggest pain points in console gaming.

I’m not a business guy, but my guess is that this is just the start to an eventual phasing-out of Xbox Live Gold. That eventual move will probably be accompanied by a price increase for Game Pass, but that’s a much easier case to make given the ever-growing library of games, including all EA Play titles, and the fact that the subscription price hasn’t changed since its 2019 launch.

If you want to hear more about this whole issue from more business-minded folks, my dear friends and colleagues Amanda Farough and Mike Futter discussed Microsoft’s likely future plans for Gold and Game Pass both during the summer of 2020. It’s a