Yeah, Wii Channels and the Online Store. Adding friends is archaic in itself; you have to have Friend Codes rather than a Gamertag with a complete account tied underneath it.
Actually, the majority of people these days do have the internet for it. DSL is sufficient enough for stable gaming sessions even with decent bandwidth at hand.
As for Xbox Live Gold costing $50, I think its well worth it. It's stable, fast and you get tons of features with it. PlayStation Network may be free, but it just doesn't offer that much other than free online gameplay. Things that are free doesn't mean it'll be good. Sony still has ways to go before they're even in league with Xbox Live.
The one thing I do congratulate Sony on is the use of actual dollars when you buy things from the PlayStation Store. That way you know what you're exactly paying for. Xbox Live and the Wii Online Store/Virtual Console use points and the currency conversion is a bit harder to understand.
All in all, I'd still gladly play for Xbox Live. After all, you really do get what you pay for. A proper online gaming service.