In other words, the old Xbox live account and the Microsoft account are now one and the same. Doesn't matter if you have an Xbox or not... If you do ever get one, you'll sign in with your Microsoft account.
Anyway, once you set up your phone with a Microsoft account, you wont be asked for it when starting the video app anymore. (btw, that's the "Xbox video" app)
edit: I was thinking about it, and I'd actually suggest resetting your phone now, and start fresh with an assigned Microsoft account before you get too far along. The phone will ask you for one when it starts up the first time.
Check out this page for more info:
http://windows.microsoft.com/en-us/w...te-account-how