FACT:
But they're getting some things right. For they understand REPUTATION. They're implementing features to "sandbox" rude players who repeatedly use profanity or other derogatory speech, which negatively impacts the majority of users (as was famously lampooned in Penny-Arcade.com's comic here (Warning: Strong Language!). Jerry and Mike, the creators of Penny-Arcade, one of the most famous and most successful web-comics, took a shot (See previous language warning) at this new development from Microsoft, but on the whole, it's just one more way that reputation capital is playing out as a factor in our day to day lives.
We are in a reputation economy.