This was inevitable, right?
I mean they never once explained why it needed to be plugged in, just that they really wanted it to be plugged in. To then force it on a system level was narrow-sighted (much like pretty much everything they originally announced).
I mean, what were they thinking? If they had come out of the gate saying you can be online all the time and if you choose to you will get these benefits, instead they made it you must be online all the time and if you don't - well screw you. Then the same with Kinect, without really giving any solid reason why a consumer would want to. If you buy our console hers some things you have no choice about. It's arrogant and dumb.
One thing can be said about a launch filled with amazing hubris that MS had is that you can get a solid month or so of good news just by backing down on every stupid thing you originally started out saying.