According to an internal email sent from Microsoft, the Xbox Live Rewards system as we know it will change on August 1st of this year. Currently the system allows for users to earn "bonus rewards," which can involve an almost comical 20 Microsoft Point "Birthday Bonus" that equates to $0.25. Since Microsoft Points will no longer be available later this year, the entire program is set to morph into something else that's "even better."
I posit that this is Microsoft's chance to really make some headway on the battle against PlayStation Plus, which at the moment is crushing Xbox Live in terms of value. I'm really hoping that in lieu of paltry points there's at least a percentage reward system -- kind of like Nintendo's 10% back program. Or maybe we'll just get lots of free digital advertisements.