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Posted May 22, 2013 by Dom Reseigh-Lincoln in Features
 
 

Xbox One | Will Microsoft’s pre-owned strategy be the undoing of the Xbox One?

xbox one
xbox one

The dust is still settling on the unveiling of Microsoft’s new home console, the Xbox One, but an ever vigilant gaming public and media has turned their eyes to the issue that’s continued to dog speculations on the new generation – the future of pre-owned gaming.

While Sony made it clear (to an extent) in February that the PlayStation 4 will support the use of pre-owned PS4 titles much in the same way the PS3 does now, Microsoft have taken a far different tact, and it’s one that could drastically affect both how we play games and the retail markets we all use.

Microsoft’s unveiling of the Xbox One was the usual affair of green lights, pretty trailers and questionable tech demos, but many details were still left unanswered as journalists departed Microsoft’s headquarters in Redmond, Washington. Would the new console support the use of pre-owned content? If so, would this support reflect the relatively liberal approach used for the Xbox 360?

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The Xbox One controller – one of the many interactive elements Microsoft are building around it’s Kinect-focused console.

The new pre-owned model for the Xbox One will be based around a registration process between your Xbox One console and the disc you’ve bought. When a brand-new copy of an Xbox One game is purchased, you’ll download the game direct to your hard drive and essentially ‘twin’ your copy of the disc to your profile. If you purchase said game second-hand, you’ll need to pay an activation fee to be able to register the disc and it’s content to this separate console and profile.

Microsoft were keen to stress that the registration process was there to link the disc to your profile, so that, by definition, you could still use the disc on another Xbox One console, so as long it’s accessed via YOUR profile. In a recent interview with CVG, Microsoft’s corporate VP Phil Harrison went into further detail on how the process will work for second-hand users: “The moment I go home and notionally take that disc with me, you no longer have the ability to play that game. But the ‘bits’ are on your hard drive, so if you want to play that game you can buy it – you can go to the online store, buy it and it’s instantly unlocked and playable on your machine. All of the privileges I just described in my house would now apply in yours as well.”

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Yusuf Mehdi, senior vice president of Microsoft’s Interactive Entertainment Business, showcasing some of the Xbox One navigation features.

Baffled? Well, one of Microsoft’s key mantras for it’s new hardware is an experience that’s tailored to you. Your Kinect sensor will automatically recognise you by your voice and/or image, launching a dashboard that’s built around your tastes and use of its services. But Microsoft does not want to lose the huge potential income that pre-owned games generate, so it’s shooting for a ‘pay for the privilege’ system.

And, while it was inevitable that one or more of the console manufacturers was going to react to the significant financial pool generated by pre-owned sales (a pool that these manufacturers have had no access to previously), Microsoft’s new approach looks to penalise owners of it’s console in attempt to create a true sense of ownership.

Will the retail price of a second-hand game reflect this additional fee – a fee that’s charged outside of its own business model? 

Based on the increased size and breadth of content eighth-generation titles will offer – and their migration to the Blu-ray disc format for physical media – the first two or three years of the consoles life cycle may not see a huge depreciation in the pre-owned value of a game. So will an Xbox One owner have to pay an over the counter price not far removed from the price of a brand new copy? And how much will this new ‘registration’ fee cost? Will it remain the same for ALL titles, or shift depending on the type of content or game it relates to? Will the retail price of a second-hand game reflect this additional fee – a fee that’s charged outside of its own business model?

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A pre-owned section in US-retailer Gamestop – is this soon to be a thing of the past?

The seventh generation of consoles has seen a boom in pre-owned games, and retailers such as US-based retailer Gamestop has shown that sales of pre-owned media has served as a significant proportion of their business. Some companies, such as EA, have even attempted to stem the tide of pre-owned copies by enforcing an online pass to their more multiplayer focused titles, but even this strategy has been abandoned for any future titles.

Will this prove a deciding factor in the coming console battlefield with Sony? 

Mircosoft have reaffirmed that this approach is “consistent with the way the world works”, but while it will prove another viable source of revenue for Microsoft, it feels like a strategy that uses a greater sense of personalisation to mask a further blow to your bank balance.

Will this prove a deciding factor in the coming console battlefield with Sony? At this stage, it’s impossible to tell, but with plenty of time left for Sony to reveal it’s own clandestine anti-pre-owned strategy, the age of economic gaming may well be put to the sword in due course.

For more information, including the facts and figures from Microsoft’s reveal yesterday, check our our factual guide to Xbox One.


Dom Reseigh-Lincoln