People have been playing video games in their living rooms for decades, but only this year did it become easy to play against people in other living rooms.

Sony began selling a network adapter for its PlayStation 2 console in August, Nintendo rolled out its online hardware in late October, and Microsoft launched its Xbox Live online service on Friday.

Microsoft's effort differs from Sony's and Nintendo's in two big ways: Its service requires an annual fee and is backed by a Microsoft-sized marketing push.

Xbox Live requires a $50 starter kit (which includes a headset, a setup disk and a year's subscription). Unlike Sony's adapter, which allows a dial-up connection, Xbox Live works only on cable or digital subscriber line Internet service.

Setup took less than 10 minutes. We plugged a cable modem into the Xbox's Ethernet port, inserted the setup disk, picked a GamerTag user identity and entered our credit card information; the Xbox did the rest, correctly detecting the network settings.

Online play is smoothly integrated -- pop in a game, select a multi-player mode, and click the Xbox Live icon. An "OptiMatch" feature lets you seek gamers with similar skill levels so you won't be clobbered immediately.

Your GamerTag stays with you throughout Xbox Live, so you don't have to log in each time you play a different game. It's also used to track your global rankings; you can brag that you're the best in Unreal Championship, but the Xbox Live leader boards will tell the truth.

You can set up the a buddy list on your Xbox and have the service find and notify pals online who are willing to play whatever game you have running.

Once your friends join you, the Xbox Communicator headset lets you trash-talk opponents or discuss tactics with allies. Unlike Sony, which offers voice communication in only one title, Microsoft put it throughout its service. A "voice masking" option lets you alter your speech. We noticed a slight lag in hearing other gamers, but nothing annoying.

Xbox Live lets you download extras such as new maps, missions and characters to the Xbox's hard drive. Some of the content may not be free, however; large-scale Xbox Live games, such as the upcoming Star Wars Galaxies: Empire Divided, might require a fee.

Eight Xbox Live titles are available -- MechAssault, NBA 2K3, NFL Fever 2003, NFL 2K3, NHL 2K3, Tom Clancy's Ghost Recon, Unreal Championship and Whacked. A total of 50 are planned by the end of next year, including a multi-player sequel to the popular combat game Halo. Most of the launch titles are strong, but forget about Whacked or NFL Fever 2003.

All that should be enough to make Xbox Live owners happy with their $50 purchases. But what happens after the first year of service? There will be an annual fee -- a new concept in console gaming -- that Microsoft has yet to specify.

"We haven't announced any details regarding future pricing options," said Cameron Ferroni, Microsoft's director of Xbox content services. He suggested that the price might shift as Microsoft adjusts promotions, "similar to cable, DirecTV and cell phones."

Another concern: If the central Xbox Live server goes down, you won't be able to get online at all, a risk that Sony's decentralized setup avoids.

Outages put us offline a few times during Xbox Live's test period, although always because of scheduled upgrades to server software. Microsoft said it built the system for maximum reliability, but the true test won't come until the masses jump onto the network.