When you purchase Xbox live online you get the chose of having a card sent to by mail with a code on it to enter into your Xbox live account or you can choose to get an instant code that you get instantly. Purchasing Xbox live online saves time and many times you can get it online for a discounted price. I have provided a link at the bottom to purchase Xbox live online for an 18% discount.
When you purchase Xbox live gold you are actually paying for the gaming aspect of Xbox live. Most of the other stuff you can either do for free or you have to pay for with either by credit card or Xbox live points. If you are into gaming which I assume that is why you have an Xbox then purchasing Xbox live gold is what you want.
Entertainment
Some of the entertainment features are free. You can watch movies through Netflix but you will need a subscription to Netflix. This is separate from Xbox live. You can also access ESPN to keep up with all you favorite sports teams. Rent or buy movies through Zune. Use your credit card or use Xbox live points. Watch TV shows through Zune too. Listen to personalized music with Last.fm.
Family and Friends
Create a mini you with an customized avatar. Connect with family and friends through the social network sites of Facebook and Twitter. Send status updates and keep in contact with all your friends and family. When you have something on your mind send out a tweet about it in Twitter. Doing this is also free.
Games
Get access to free games, demos, and trailers. This gives the option to try the games before you buy them. Play with other people from all over the world in real time. Go head to head against other people. Get add ons to your games like extra levels, songs, maps, and others. There are games for all. Xbox live gold members get exclusive discounts and an offer for the deal of the week.
If you have purchased Kinect or Windows Phone 7 then the options are endless. There are many things to do when you purchase Xbox Live Gold. Buy Xbox live Gold here. Buy Xbox live and experience a whole new gaming experience.