Errr.. where did I say that you claimed they were going to make online free?
I'm confused here. Why do I need to re-read what you wrote again? lol Why would they raise the price of something if they plan on getting rid of it.. to push people to a lower margin service? Makes.. zero sense.
I think they raised the yearly price of Live to $120/year because they want that $120/year per user to be the minimum. Ideally they want $180-$240/year. I think they now know they can't get away with just doubling Live price without reason. So they'll find another way, they're greedy. This new way will be forcing users to pay for Game Pass instead, then just raise the price of Game Pass.
It makes perfect sense. They get to have:
1) more revenue overall
2) more GP subscribers to brag about to their investors
3) higher minimum revenue per user ($120 vs $60)
4) less bad PR when they raise the price "cuz game pass so good"
5) no more monthly games with gold expenses
6) set up easy future price hikes for game pass
7) streamline and simplify the services they sell
8) focus all marketing just on game pass brand (no more live brand)
9) profit
I agree with you that they would love nothing more than for Xbox Live subs to move to Game Pass. But they can't kill Xbox Live Gold and forfeit all that revenue or suffer the horrible PR that would result. And they can't force people to change to Game Pass Ultimate. Seems like they are trying to slowly "de-brand" Xbox Live and let it work itself out via attrition. I think Phil Spencer was hoping Game Pass Ultimate would have overtaken Xbox Live Gold in numbers by now, but the combination of all forms of Game Pass are still around 20 million. I'd think XLG has more than that. Not sure though.
I think their initial plan was "lets make XBLG cost $120/year so GPU at $180/year LOOKS like a deal." People got mad at the price doubling, so they're gonna try to do it again somehow. They want that $180/year per user, somehow.
Right now, millions of Xbox users only give them $60/year, others $120, and some $180. The min is 60, max is 180.
If they simply announce "all existing XBLG subs are now GP subs" and then add in "GP will now be required online multiplayer *except free to play" sure some people would be mad, but not nearly as mad as when they just said "fuck it XBLG costs 2x now."
They want that year min per user up to $120, not 60. Its not quite as good as getting the GPU $180 but its a start. Once everyones comfy with GP for $120/year, just bump the price up $1 each year and suddenly they've got to their $180+/year goal.
They're never gonna add value to XBLG anymore, so how else do you achieve the goal? Gotta pretend to offer more value in order to take more of their money.