Today, March 5th, Microsoft’s Xbox Live team announced a change in their terms of service. This new change allows, among other things, LGBT members to express their "relationship recognition" in their Xbox Live profile information. A set of approved words has been set for each language the service operates in.
You may use the following terms to express your relationship orientation in your profile or Gamertag:
Other terms regarding relationship orientation are not allowed. In addition you may not use these terms or any other terms regarding relationship orientation to insult, harass, or any other pejorative use against other users.
It’s great to see Microsoft moving forward on this and honoring their promise to address this. Initially, there was discussion around the best way to solve this problem. The key requirement was how to minimize the potential use of words like these, or the expression of them, to increase harassment. Various options were explored over time, including changes to the service. However, as is often the case, the simplest solution wins out. KISS principle at work.