Bill Gates hyped a huge announcement for the Xbox 360 at this week’s CES, and like geeks upgrading their hardware, we jumped on the hype without thinking.  The biggest announcements were more downloadable movies and the beginning of IPTV, or in Gates’ words, using the Xbox 360 as a set-top box. BT Group, a leading British telecom company, was announced as the first provider of content through this surface.

But now we’re learning what that really means.  In truth, it almost feels like 360 owners and journalists and anyone who cared were lied to.  The truth is the 360 will not be able to stream content, record content, or possibly even access content without a BT subscription.  All the hype and leaked screenshots and presentations from over a year ago have lead to basically another paid service for the Xbox that basically gets you almost live soccer and some on-demand shows and movies.

Tech.co.uk writes:

"In order to receive the service you will need to meet the requirements set out online at www.bt.com/btvision," say the BT Vision T&Cs, "and your BT Total Broadband service must be activated and subject to a line survey test that we will perform."

Now there might have been a new Xbox 360 model with an HD DVD drive built-in hiding on stage as many bloggers and pundits have predicted, but got withheld because of Warner Bros. announcement it was going Blu-Ray exclusive.  But was Gates so closed-off that he didn’t think of the possibility?  Or did it just not matter - creating hype for hype’s sake is enough.

This is an example of what I consider terrible customer relationships and taking advantage of the valuable and loyal evangelical base Microsoft, the Xbox brand, and many tech companies enjoy.  When the head honcho Bill Gates says there’s a big announcement coming, people listen.  And when it doesn’t happen, people are pissed.  The hundreds of blog posts we wrote and read make us feel silly while we ponder what could have been.  And then to make the pathetic runner up a misrepresentation (the 360 will not be a set-top box under these conditions by any definition) is even more insulting to fans who will happily spread the word of any awesomeness planned.

Microsoft could have avoided these problems by having a back up plan, as any executive should have.  You never know when something will go wrong.  Give us our Gears of War 2 announcement or make Xbox Live Gold free or announce some new feature, even if it’s a long way’s off.  But the way this was handled takes the fans for granted.  We keep falling for it and we’ll fall for it again, but please, tech companies (all companies), stop toying with our emotions.  We want cool stuff, not to be be teased with the hope of.