This is not at all a Live sucks, PSN is better thread, I actually think both services are very similar in what they do and how well they do it. Everything I'm about to say is completely factual.
My problem with Live is that Microsoft wants to have their cake and eat it too as Microsoft charges you for services they don't provide. The FREE Silver Live account offers services that actually cost Microsoft money and resources to provide. Running and maintaining the servers that store the games, demos, DLC, etc. for everyone to download is at least 90% of the expenses of the Live service. And, all that stuff is offered for FREE through Silver membership because Microsoft wants everyone to have access to their store so people can spend money in their store.
For Live Gold membership, Microsoft charges you for Netflix, online gaming, Facebook, last.fm, etc. So, in order for you to have the ability to watch Netflix, you have to pay Netflix, your ISP, and MICROSOFT!!! Microsoft is not incurring any costs of any kind when you watch stuff off Netflix, Netflix is streaming movies from their servers using their bandwidth to you over your bandwidth that you are paying for, Microsoft is not involved in any way. To prove, rather simply, for people who might not believe that, PS3 users can still use Netflix with PSN down.
Onto online gaming, which is another big slap in the face to Live customers from Microsoft. If you play any third party game (e.g. COD), Microsoft is not incurring any costs or bandwidth when you play COD online as you are not playing on Microsoft's servers (you are not even playing on a server as almost every console online game is player hosted) and the publisher of the game is running the game servers that just track stats and nothing else. For a game like COD, the developer puts probably about half its resources into the multiplayer aspect of the game so about half the money you payed for the game is for the multiplayer. On Live, you have to pay Microsoft to unlock game content (online multiplayer) that you already payed for when you bought the game. The only thing that would make sense is if for Microsoft to allow online multiplayer for 3rd party games for Silver accounts, but only allow Gold accounts to pay first party games online. However, Microsoft isn't going to do that because people would be like, "I can play COD or Bad Company for free, screw Halo and Gears" and those communities would be a lot smaller. Also, Microsoft doesn't even run any dedicated servers whereas Sony does run dedicated severs for a few games (MAG, Killzone, Warhawk, etc.).
The only service Microsoft is providing you for Gold membership is cross-game chat so you are basically paying $60 a year for cross-game chat and that is it.
This is why I will never pay for Live as I'm not going to pay someone for a service they aren't providing, it's that simple. If Sony pulled this, I'd turn into a PC gamer and use Steam, which also provides the same services Live Gold does for free.
