I don't know why you're turning this into a debate over whether this is a fiscally responsible method of purchase, it's not my intention to argue the value to the consumer, only the method's value to the consumer. It works. People like it because they can get something now and for relatively little, depending on their monthly discretionary spending level or desire for maximum convenience. Nothing is new or revealed in doing some simple math the average person does to pay their bills or work out which contract is better. People aren't functionally fucking braid-dead, guys. They choose based on their own personal sense of value, just like anyone.
I turned it into a fiscal responsibility argument because I found the "hardcore gamers are willing to pay upfront because gaming is part of their identity" argument to be stupid. I do not disagree that some people prefer to have the cost spread out over a longer period of time as a matter of personal choice, but being a "hardcore gamer" has nothing to do with why I'm psychologically willing to pay more upfront but less overall.