To put XBox Gold into complete perspective, it's an update service and a matchmaking service which is being vastly overcharged for with no competition allowed.
It does absolutely nothing you can't get for free on PCs.
And you can't even have dedicated servers so when Bob the host's housemate starts downloading a torrent you all go into sllooowww mode before you all get kicked.
I think for it as a standalone service, it is perhaps overpriced. However I think of it instead as subsidizing many other things on the Xbox, including its original manufacture, continued R&D, patches to the system, and community management.
The voice + matchmaking experience is pretty nice, moreso since it is tied into a long-term identity system. There isn't a good parallel solution for free on the PC for that that has such strong integration (yet).
I was under the impression that servers were hosted by Microsoft (or someone), which is why you can't play Halo 2 anymore. They aren't dedicated ones that you pay for otherwise, but they are dedicated from my understanding.
Consoles are tradeoffs between ease of use, consistent user experience and power. Microsoft works really hard to make it an easy, consistent user experience. Sure you don't get all the modding power, ability to customize your servers, but on the flip side it is very easy to use. It works for most people most of the time.
I feel like I get $60 of value per year out of playing online with my friends, having voice chat, fooling around with avatars, and particularly, downloading free games and demos from XBL Arcade. No complaints here.
How is Battle.net these days, anyway? People were howling in outrage because of some kind of identity thing that Blizzard decided to do. Is it usable? Fun?
Given the price and that I only use Live Gold for watching Netflix, it's almost high enough to justify getting a second Roku (would take 2 years to break even, though) for our house. It'd be a lot less of a heat-generator for my small office.
If I actually used the Live Gold for gaming, I wouldn't mind the cost as much. It's still not much for what it does provide. I just don't like playing multi-player games on the console. It's frustrating, however, to pay $60/year for the mere privilege of opening an app that likely doesn't cost Microsoft anything. If Roku can stream for free from Netflix, I'm imagining Microsoft does the same.
Many modern televisions have D-SUB connectors; if you have a desktop that is near your TV, you can also get a second video card and simply connect it to your TV like any other monitor. Even if you only have DVI-out, you can convert losslessly from DVI to D-SUB with an inexpensive adapter.
I can agree that if you're using your Xbox mostly as a Netflix player, then it isn't really a good deal. I'm not totally sure why Netflix is bundled into that, since you're already paying for it via Netflix.
This news reminded me that I still needed to stop paying my Xbox live account I never use. Went through their (not-so) funny game of "are you sure you want to quit? are you sure you want to quit?" ad-infinitum.
Being in Canada, many of the Live benefits (e.g. Netflix) aren't even available here, which is a luxury that we pay a premium for.
For us it is simply a gaming matchmaker for online play, and a way of buying grossly overpriced movie rentals (with 24 hour viewing periods from the moment you click play) and overpriced downloadable games, like a ghetto version of Steam.
I can't believe I actually pay for the ability to overpay like this.
Here's the best part -- some time back I bought Ghostbusters on Games on Demand. Somehow over the following months the install got deleted from the console, but that's okay: one of the big advantages of XBL Games on Demand is that if you buy a new Xbox, your hard drive crashes, you need to make space, etc, you can just redownload it when you want it again. So I navigated looking for it.
But I couldn't find it.
They had removed it from their catalog -- this is apparently a regular event for a wide range of titles -- which means that my virtual purchase is now forever gone and irretrievable.
That's the last Games on Demand I'll be buying on XBL.
And if you try to cancel the auto-renew that they surreptitiously enrolled you in...have fun. Xbox Live engages in the most atrocious hide-the-link behavior. It's incredibly shady for a company the size of Microsoft.
Their auto-renew behavior is unfortunate, as is the customer service scenario you outlined. Did you get any resolution through contacting their customer service?
It does absolutely nothing you can't get for free on PCs.
And you can't even have dedicated servers so when Bob the host's housemate starts downloading a torrent you all go into sllooowww mode before you all get kicked.
Gold, or no internet play.
It sucks.