This is one of those "solutions" that companies try to do first: "I will comply with your freaking regulations, but I will not make it really difficult for not-brain-dead people to circumvent it." Real problems will happen when regulators in some countries will feel it is not enough.
This is an old model. It was called Gaming Archades. You put a quarter, and you play the game until you lose. The only difference is that Microsoft will give you a few free hours a month.
Smart. Avoiding lawsuits while providing service.
It's opt-in, so at least only stupid ones will use it.