$99 Xbox 360 bundle officially unveiled, now available

Microsoft has officially announced the previously-rumored $99 Xbox 360 bundle.

The new subscription-based bundle includes a 4GB Xbox 360 console with the Kinect sensor for only $99.  The catch is you must sign two year Xbox LIVE Gold contract at $14.99 a month – similar to how how cell phone carriers operate.

The bundle is only available at select Microsoft stores (bring the offer code "885370366266" to your local store).

If you choose to cancel your contract, an early termination fee will be applied.  According to the contract terms, you will be responsible for paying $12 each month for the remaining contract.  So if you cancel after the first year, you will still be responsible for paying $144.  Cancelling with only one month left will cost you $12.  Check out the full terms and conditions for the $99 Xbox 360 console bundle.

The pay-as-you-go method for the Xbox 360 is the first we've ever seen a console manufacturer offer for a gaming console.  Will it soon catch on?  This new promotion could change the way the industry will work in the future.