The reports about Microsoft offering Xbox 360 under contract seems to be true. You can now buy a Xbox 360 4GB console with Kinect for just $99 under two year contract. The contract for two year would require you to pay $14.99 for Xbox LIVE gold subscription. This is a great deal for a family looking for an entertainment hub. The offer so far appears to be only at Microsoft brick and mortar stores, but you can expect them soon via other stores as well.
Find it here from Microsoft Store website.