[sc:windows-category ]When Microsoft introduced Xbox Live and the 360, they also introduced Microsoft Points. You can use these points to buy things in the Xbox marketplace so that the marketplace has a consistent “price” (in points) no matter what your local currency is. The currency conversation is done when you purchase the points, not when you purchase the item from the marketplace.
This also give Microsoft the added benefit of selling you points in fixed amounts (say 1600) even though you may only need to spend 500 to purchase whatever you wanted. This effectively gives Microsoft the extra 1100 points to earn interest on until you go and spend them. Sure this may seem trivial at the individual scale, buy Microsoft does this across millions of Xbox live members and those pennies add up at that scale.
When Microsoft introduced the Zune marketplace, they continued to use points as the currency of choice. However when they introduced Windows Phone 7, the marketplace used US dollars instead.
This was an obvious move to make it more accessible to a non gaming demographic and simplify the user experience.
The points system is one reason I didn’t pick up an Xbox over the years (I have recently but that’s the subject of a future post), I didn’t want to deal with the conversions.
If the rumors are true, it looks like Microsoft is going to drop the points system from the Xbox as well (or at least have both points and dollars as options), as what I can only assume is the precursor to the Windows 8 marketplace opening up to the public.
Having a unified pricing system across all their online properties makes a lot of sense and I can only hope they do it soon.