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Xbox 360 for Only $99?

Microsoft(NEW YORK) -- Microsoft’s rumored Xbox 360 for only $99 has just become real. Naturally though, with a drastic price reduction there are a few catches.

For $99, you’ll get a 4GB console along with the Kinect motion-capture sensor. The catch is you also have to agree to a two-year, $15-per-month Xbox Live Gold Contract. Similar to a cellphone contract, if you decide to opt out early, termination fees will run you anywhere from $12 to $250, depending on how much time is left on your contract.

After two years, this “deal” will cost almost $460, compared to the regular purchase price of just $299 for the bundle and two years of Xbox Live at $59.99.

Consumers who don’t have the cash on hand for the $299 bundle might be enticed by this offer, but in the long run, it’s not as cost-effective.

For now, this “promotion offer” is only available at Microsoft’s official retail stores.  It’s unclear if the software giant will expend this experiment into its online store or other electronic retailers.

Trying to capitalize on the same strategy used by cellphone carriers, Microsoft hopes this new promotion will entice consumers.

Copyright 2012 ABC News Radio

ABC News Radio