Yesterday Microsoft finally told us how they are going to treat the used game issue. The exact details can be read in this post by Jordan:
In short, whether or not you can trade in your games is now up to the publishers and trading games is only possible with participating retailers. These facts are obviously quite interesting but even more interesting to me is the question why Microsoft choose to take these steps.
First I am sure it is safe to assume that Microsoft doesnīt like the used games market. Microsoft is partially a publisher and as such is losing money due to resale of games. In addition to that Microsoft also has to keep third party publishers interested in choosing the Xbox One to publish games on. And these game publishers (Hi there, EA) obviously donīt like the used games market. This directly brings us to the first reason why Microsoft takes these steps. By allowing publishers to opt-out of the used games market they are making themself attractive for these publishers. Another side effect of this opt-out model is, that Microsoft can always shove the blame monkey to the publishers. If someone is to accuse Microsoft that it sucks that, as an hypothetical example, the new Call of Duty can not be traded in, all they have to say is: "Not our fault, Activision decided to do so." That is quite a smart trick to avoid bad press.
The smartest part of Xbox One concept though can be seen in the possible longterm effects on the used game market. Microsoft is fighting the used game market not head on, since that would awake the anger of both the customers and the big retailers, but instead tries to kill it slowly. By allowing only participating retailers to take part in the used game market they effectively inhibit the rise of new companies trying to get their share of this market. They might also put already existing small companies out of business by simply saying: "No, you are not allowed to participate." By this theyare be able to prevent any mayor grow in this market. The killing of the used game market comes in place when you take a look at the practical situation that can rise from the opt-out model. Some publisher will use it, some wonīt. This makes used games a pain in the ass. As a customer I have to take in consideration whether or not a certain game can be traded in or not. This means checking forums, blogs and publisher sites. If I want to buy a used game online, e.g. ebay, I canīt rely on the seller since he or she probably doesnīt know whether it can be played used. For the retailers used games become more unattractive as well, since being able to resell only part of the games means financial loses. This can sooner or later drive them towards looking for new business models which arenīt as much trouble. This makes used games for both customers and retailers unattractive and will damage the used games market in the long term.
Whether or not any of this actually happens really depends on Sony. If Sony decides to go the same route the used games market will eventually die. This might be beneficial for them, as they are probably losing money due to used games. Furthermore they would appeal to the third party publishers in the same way Microsoft tries to do. However if they decide to allow used games they might get a huge boost in terms of good publicity and loyalty among the customers. That in return can be beneficial as well. It can lead to more sold systems in the west they making them more attractive for third party publishers.
Eventually the decision if the business model of the Xbox One will succeed is up to us customers. Think about which way you want your games to be handeld in the future. The text should made clear that I would prefer the used market to continue existing. I depend on it and I know a lot of people that depend on it as well. However if you think that the used market ultimately does more harm than good feel free to go for the Xbox One business model. The only thing I ask from you is to think about what you are doing when choosing the console you want to play the next generation on.