The $99 XBox is official, but does it make sense to buy?

If you buy the XBox at the $99 price, Xbox Live subscription for 2 years is mandatory and, just like your contract cell phone, you will pay an early termination fee of up to $250 if you need to get out early. The total cost of the subscription over two years is $360, making the real cost of the console under this plan $459.

Compare this to purchasing everything up front. Most retailers sell the Xbox 360 4GB/Kindle Bundle for $299, although Walmart sells a similar package online for $229. If you add in the Xbox Live Gold service, that’s another $120 (billed at $5 per month). If you go with Walmart’s deal, you’d spend $110 less over two years. Definitely not chump change.

Better yet? Buy the console straight from Microsoft and you get $15 off per year of Xbox Live Gold. There, the console is $299 but the total you'll spend is around $389, $70 cheaper than the contract plan. But there’s an even bigger reason why you will want to stay away.