Verified answer

DO NOT buy the Xbox 360 Arcade. If you want to play Live, get the premium. Slightly more expensive, but very much worth it. If you get the Arcade, you will have to buy a separate storage device, such as a memory card, a headset (which comes with the Premium), and an Ethernet cable if you want to connect to Live via a cord. Also, Premium comes with a wireless controller, while the Arcade has the wired one.

Those are just a few of the reasons why you should shell out a little extra for the better model.

The Arcade version is worthless. You can play games and play online but good luck saving the game. It has almost no memory. Its worth the extra $100 for the pro.

There the same except!! It doesn't come with a hard drive so you have to buy that your self! And also i heard arcade has a bit worse failure rate? I could be wrong, but thats just the people opinion. I would get it though, cheaper, and comes with some free games XD