Xbox Live (trademarked as Xbox LIVE) is an online multiplayer gaming and digital media delivery service created and operated by Microsoft Corporation. It is currently the only online gaming service on consoles that charges users a fee to play multiplayer gaming. It was first made available to the Xbox system in November 2002. An updated version of the service became available for the Xbox 360 console at that system's launch in September 2005, and is a competitor of Sony's PlayStation Network and Nintendo's relatively new Nintendo Network.
The service was extended in 2007 on the Windows platform, named Games for Windows – Live, which makes most aspects of the system available on Windows computers. Microsoft has announced plans to extend Live to other platforms such as handhelds and mobile phones as part of the Live Anywhere initiative. With Microsoft's new mobile operating system, Windows Phone, full Xbox Live functionality is integrated into new Windows Phones that launched since late 2010. The service shut down for the original Xbox in May 2010.
The Xbox Live service is available as both a free and subscription-based service, known as Xbox Live Free and Xbox Live Gold respectively, with several features such as online gaming restricted to the Gold service. Prior to October 2010, the free service was known as Xbox Live Silver.
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, called SegaNet and Dreamarena. 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 or widely available. Downloadable content was available, though limited in size due to the narrowband connection and the size limitations of a memory card. The online features, while praised as innovative, were largely considered a failure, and the Dreamcast's immediate competitor, 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 Gatesboth 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 the idea, citing poor broadband adoption at the turn of the century.
When the Xbox launched on November 15, 2001, the as-yet unnamed online service was destined for a Summer 2002 deployment. 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. 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 Revolt! (which never was released officially) and NFL Fever 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 tshirt with the slogan "I have 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's 5000th patent was Live-related and gave Xbox 360 users access to watch other gamers compete against each other over Xbox Live.
The packaging for playable Xbox Live titles on the original Xbox console featured the trademark 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. This was changed later, wherein all Xbox Live titles included the universal 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".
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 Mark Whitten, Xbox LIVE General Manager. 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. 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.
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.
On February 5, 2010, Marc Whitten announced that Xbox Live had reached 23 million members. That same day, Larry Hyrb, Xbox Live's Major Nelson, announced on his blog that Xbox Live support for the original Xbox would be discontinued on April 15, 2010. This included online play through backwards compatibility on the Xbox 360 and all downloadable content for original Xbox games.
In October 2011, Microsoft announced live streaming cable television with various providers.
On December 6, 2011 Microsoft launched an update for Xbox Live that includes custom applications from world leading TV and entertainment content providers.