Launch with the original Xbox
As Microsoft developed the original Xbox console, online gaming was designated as one of the key pillars for the greater Xbox strategy. Sega had made an attempt to capitalize on the ever-growing online gaming scene when it launched the Dreamcast video game console in 1999, including online support as standard, with the SegaNet service in North America and Dreamarena in Europe.[24] Nevertheless, due to lack of widespread broadband adoption at the time, the Dreamcast shipped with only a dial-up modem while a later-released broadband adapter was neither widely supported nor widely available. Downloadable content was available, though limited in size due to the narrowband connection and the size limitations of a memory card.[25] The PlayStation 2 did not initially ship with built-in networking capabilities.
Microsoft, however, hoped that the Xbox would succeed where the Dreamcast had failed. The company determined that intense online gaming required the throughput of a broadband connection and the storage space of a hard disk drive, and thus these features would be vital to the new platform. This would allow not only for significant downloadable content, such as new levels, maps, weapons, challenges and characters, to be downloaded quickly and stored, but also would make it possible to standardize bandwidth intensive features such as voice communication. Steve Ballmer and Bill Gates both had a vision of making premium download content and add-ons that would attract many new customers. Based on this reasoning, the console included a standard Ethernet port (10/100) in order to provide connectivity to common broadband networks, but did not include a modem or any dial-up support, and its online service was designed to support broadband users only. Critics scoffed at it, citing poor broadband adoption at the turn of the century.[26][27]
When the Xbox launched on November 15, 2001, the as-yet unnamed online service was destined for a Summer 2002 deployment.[28] Xbox Live was finally given a name at E3 2002 when the service was unveiled in its entirety. Sound-dampened booths and broadband-connected Xbox consoles—featuring an early version of Unreal Championship—demonstrated the service on the show floor. The Epic title was one of the flagship titles for the service, which was slated for a debut on November 15, 2002, marking the anniversary of the Xbox launch. Microsoft announced that 50 Xbox Live titles would be available by the end of 2003.[29] Utilizing the required broadband bandwidth, Xbox Live featured a unified gaming "Friends List", as well as a single identity across all titles (regardless of the publisher), and standardized voice chat with a headset and communication, a feature that was still in its infancy.
Leading up to the launch, Microsoft enlisted several waves of beta testers to improve the service and receive feature feedback. The first wave of beta testers were given Re-Volt (which was never released officially) and NFL Fever 2003 to beta test. Once beta testing concluded, Microsoft sent these beta testers a translucent orange memory card, a headset carrying case, and a beta tester t-shirt with the slogan "I've got great hands". When the service debuted, it lacked much of the functionality that later titles included, but Xbox Live grew and evolved on the Xbox and many aspects of the service were included with the Xbox 360 console out of the box, rather than through a later update. Microsoft granted Live-related patent that gives Xbox 360 users access to watch other gamers compete against each other over Xbox Live.[30]
The packaging for playable Xbox Live titles on the original Xbox console featured a trademark luminescent orange-gold bar underneath the Xbox header. Tom Clancy's Splinter Cell and Brute Force sported a Live "bubble" design, as they only featured downloadable content. It was changed later, wherein all Xbox Live titles included the universal orange-gold Live bar. By the time of the Xbox 360, all titles were required to provide at least a limited form of Xbox Live "awareness". In July 2004, Xbox Live had reached 1 million online users.[31] In July 2005, Xbox Live had reached 2 million online users.[32]
Subsequent growth
On November 15, 2007, Microsoft celebrated Xbox Live's 5th anniversary by offering its then over 8 million subscribers the title Carcassonne free of charge and awarding gamers who had subscribed to Live since its inception 500 free Microsoft Points. Due to intermittent service interruptions during late December 2007 and early January 2008, Microsoft promised to offer a free Xbox Live Arcade game to all Xbox Live users as compensation, in an open letter to all Xbox Live members from Marc Whitten, Xbox LIVE General Manager.[33] Increased demand from Xbox 360 purchasers (the largest number of new user sign-ups in the history of Xbox Live) was given as the reason for the downtime.[34] On January 18, 2008, Microsoft announced Undertow would be offered free to both Gold and Free members for the week starting January 23 through January 27 as compensation.[35]
On November 12, 2009, Dennis Durkin, COO of Microsoft's interactive entertainment business, announced that November 10, 2009, the release of Call of Duty: Modern Warfare 2 marked the busiest day ever on Xbox Live, with over two million active users simultaneously.
Rebranding
On January 22, 2021, Microsoft planned to increase the prices for the Xbox Live Gold subscriptions, as follows: by $1 for the monthly subscription ($10.99 from $9.99), by $5 for the 3-month subscription ($29.99 from $24.99), by $20 for the 6-month subscription ($59.99 from $39.99), and by $60 (double the price) for the 12-month subscription ($119.99 from $59.99). However, the 6-month and 12-month subscription price increases would not affect existing subscribers when they resubscribed at the same level, nor those already subscribed through the Xbox Games Pass Ultimate program.[54] However, after complaints from the Xbox community, Microsoft made an announcement on the same day that they revoked their decision, and that they would not increase the prices of any of the subscriptions, thus they would remain the same as they were.[55][56]
Microsoft officially announced that they would be branding Xbox Live as "Xbox network" in March 2021 as to cover all the services related to Xbox and not just Xbox Live. Xbox Live Gold would remain the same name and to distinguish the subscription program from the set of services. Microsoft also stated that with this, it would eliminate the requirement to have Xbox Live Gold to play free-to-play games on Xbox consoles.[57]
