Well, I was quite surprised to receive an invitation to join Microsoft Live, but I was somewhat dismayed with the offering. I'm pretty sure it will go something like the way Hotmail has, MSNspace is, and pretty much all of M$ offerings, never mind the listbot website… etc, etc.
Here's the typical plan:
Step one: create or buy an innovative service or product (e.g. HOTMAIL)
Step two: build up a large audience for it, esp. those who come to 'rely' on it (Listbot)
Step three: start to monetize the service by creating tiers of products from basic to advanced. Usually basic accounts face increasing limits on what you can do, can't do, and creeping restrictions introduced without advance notification, to tie your customers to your products even more. (no addressbook export functions in HOTMAIL)
Step four: let your 'basic' products wither while you push enough customers to the more advanced services that now contain all the features that you used to include in the basic product. (MSWorks v.4.5 was great, later versions really don't pass muster).
Step five: Let your 'basic' product fall behind competitors, to save on expenses, etc. while burdening your competitors with the cost of maintaining your 'ex-' customers. (again HOTMAIL vs. Yahoo! Mail)
Step six: close, 'upgrade', or otherwise dump the basic services. (Listbot)
That's the game plan. This is what will happen with Office Live.
You heard it here first.