Microsoft's Xbox Video Upgrade Arrives Alongside Walled Gardens and Eroded Legal Rights

Microsoft this week released their much-ballyhooed Xbox 360 dashboard update, which includes a significant emphasis on "new" video content. In reality the update is largely aesthetic in nature, with most of the video upgrades not offering new content for those shelling out $60 a year for an Xbox Live Gold subscription. Netflix, Hulu Plus and other existing services got a redesign, but new additions like Epix simply redirect you to paywalled VOD options. Promised integration of FiOS and Comcast content (available only if you subscribe to both broadband and TV services from those companies) have also yet to materialize. One thing that did show up was new terms of service language that prohibits users of Xbox Live from participating in class action lawsuits against the company. You'll recall that nearly every company under the sun has been including this language in their terms of service after the Supreme Court recently told AT&T that eroding consumer legal rights in fine print was perfectly acceptable. Microsoft is circulating a press statement saying you cannot opt out if you want to continue using the service: Users must agree to the new clause to the Terms of Use in order to continue using Xbox LIVE. Changes to the Terms of Use are designed to ensure that our customers have an easy way to file a dispute without requiring formal legal action. They may now bring a dispute to our attention by filling out a simple Notice of Dispute form found at www.xbox.com/notice and mailing in documentation in support of their claim. As we've noted previously, such language has nothing to do with making things "easier" on customers, and everything to do with forcing users into binding arbitration -- where arbitration companies hired by Microsoft (or AT&T, or Sony, or Cablevision) rule in favor of their employers a significant majority of the time. While there's certainly a debate to be had over the disproportionate benefits lawyers enjoy in class actions, eroding a customer's legal options solely benefits the corporation. That aside, it remains interesting that the highlight Microsoft's hyped broadband-video improvements so far involves obnoxious fine print that erodes your legal options. Customers complain that many of the GUI options (particularly the Netflix redesign) fix things that aren't broken, while the new video options -- aren't really particularly new. The cable and broadcast industry is terrified that Internet video will erode their legacy cash cow, and continues to ensure that every new product released is as uninteresting as possible -- unless you subscribe to traditional television.