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Xbox 180: Microsoft pulls back from the brink

Xbox 180: Microsoft pulls back from the brink

Thu 20 Jun 2013 3:38pm GMT / 11:38am EDT / 8:38am PDT
Business

Junking the hated DRM was an essential move - Microsoft deserves praise for acting swiftly and decisively, says Rob Fahey

A week ago, I tried to reason out the thought process that had led Microsoft to undermine its public unveiling of the Xbox One with a breathtakingly unpopular DRM system. I started from a simple assumption - that Microsoft is a company full of very intelligent people who had, collectively, made a bad decision, which implied that the data backing that decision or the culture surrounding it was the problem. Microsoft often has trouble reading consumer market sentiment (witness the commercial failure of almost every consumer product it has launched other than the Xbox 360) but its employees are neither stupid nor stubborn - it was inevitable that after the torrent of data which the company received before and during E3, the firm's brightest minds were thinking carefully about how to proceed.

"Mattrick was handed a gun and told to take the much-derided DRM scheme out behind the woodshed, where he promptly put it out of our misery"

Now we know what they decided - far sooner than any of us had given them credit for. They listened. They pulled back. They assessed the reaction to their DRM policy - far more passionate and widespread than they had imagined it to be - and made a simple call. Reverse. A hair-brained DRM scheme cooked up in a boardroom and already showing cracks before E3 arrived (if any of you honestly believe that the 10-person "family" sharing notion was a fully considered policy and not a desperate measure flung out half-baked in an attempt to calm consumer sentiment, I've got a bridge I'd like to sell you) was judged to be far less important than the overall goal of making a console that sells strongly and retains or builds the Xbox market share. Don Mattrick was handed a gun and told to take the much-derided DRM scheme out behind the woodshed, where he promptly put it out of our misery.

This is the right call. More than that - it's a swift and decisive call, at the end of several weeks where Microsoft has seemed incapable of doing anything but dithering and equivocating. The company's E3 wasn't just disastrous because of Sony's relentless gut-punching - it was disastrous because Microsoft still seemed incapable of giving straight answers. New questions popped up time and again which nobody at the firm seemed to be able to tackle with direct answers - at least, not direct answers that didn't promptly change within a few hours. Xbox One was going to be locked regionally using IP ranges, so you wouldn't be able to use your own console and games abroad! Or was it? We weren't sure. Anyone banned from Xbox Live was going to lose access to all the games they'd bought! Or perhaps they weren't. Opinions differed within Microsoft itself on that one, seemingly. As for the big, looming question of what happens to your games in ten years when Microsoft gets bored of running authentication servers and decides to switch off the Xbox One iteration of Xbox Live, absolutely nobody had any kind of answer to that - which tended to suggest, horrifyingly, that nobody had even thought of it.

By comparison, Don Mattrick's statement this week was outright refreshing in its clarity and directness. As much as I'm impressed that the firm has acted so rapidly and decisively to put a lid on this situation and start repairing the damage (which will take time and a lot more effort), I also hope that it has learned some really important lessons about communication and messaging. The problem with Xbox One DRM was not primarily a communication problem - the problem was that the DRM was a shambolic piece of monstrous corporate thinking that contemptuously treated every consumer as a potential criminal, and good PR for that would be like putting a sprig of parsley on a fresh turd - but bad communications definitely exacerbated things. Awful DRM might have ignited tech and gaming specialist media for weeks on end; awful DRM and awful communications, however, got this story right up in front of the world's media, turning Xbox into a butt of jokes on chat shows and a topic of derisive conversation among even the most casual of gamers and consumers.

"There's nothing dishonest or untoward about any of this - it's a good, successful company reacting in a sensible and mature manner"

Let's be clear - that is not a situation Microsoft could tolerate and it absolutely made the decision to drop DRM inevitable, even if the haste with which it has happened is surprising. This is not, as the dwindling but vocal band of DRM apologists would have it, a victory for loud-mouthed internet troublemakers, nor is it some kind of dishonest manipulation of consumer power by media busybodies. This is the market at work. Microsoft wanted to do one thing; Sony said it would do a different thing. Consumers - real, honest to god consumers, the people who actually go out and buy this stuff with their money and who, consequently if indirectly, end up paying the wages of everyone involved in this industry - made a clear decision that they preferred Sony's approach. Microsoft looked at what was happening, did the maths and decided to drop DRM like a hot potato. There's nothing dishonest or untoward about any of this - it's a good, successful company reacting in a sensible and mature manner to a consumer rejection of its policies.

In terms of those apologists, there seem to be two distinct if overlapping groups, both of whom have been making their point forcibly ever since Mattrick's announcement. The first is the likeably optimistic bunch who genuinely thought that Microsoft's DRM was a swell idea. They assumed, based on no evidence other than a deep belief in the innate goodness of media corporations, that the strict DRM of the Xbox One would enable publishers to drop the price of games and would put a stop to in-app purchasing, DLC and all the other bugbears of core gamers which, apparently, only exist because people keep on trading in their games at Gamestop. With sales soaring (an evidence-free assertion in itself) and income being raised for publishers from second-hand sales, prices would fall and the need for after-sale business models to boost profits would evaporate. Plus, the 10-person "family" sharing scheme was going to let us all share all of our games with ten friends, presumably meaning we'd only have to buy one game in ten, a system which would, er, in no way cause problems for the former assertions regarding soaring game sales.

The problems with this worldview are numerous and fairly obvious, but the most prominent is the notion that publishers would treat their income from second-hand sales as being a replacement for DLC, IAP and eye-wateringly high game prices. The reality is that publishers would slurp up that new income, add it to their bottom lines and wouldn't even say "thank you" before seeking a new way to expand their profit base. That's not because they're evil - it's because they're corporations, and if they didn't do that, they wouldn't be doing their jobs properly and their shareholders would find a way to fire them. Incidentally, for precisely the same reason, you can be absolutely certain that Microsoft's last-minute Hail Mary play of announcing 10-person sharing groups was never going to see the light of day without crippling restrictions. Still - I can understand and even respect the optimism of people who genuinely saw Xbox One DRM as heralding a brave new dawn for gaming, even if I think they're utterly wrong. And hey, about that bridge... Seriously, it's a lovely bridge. You'll love it.

"We'll all listen sympathetically to your complaints about puncture wounds in your neck when you stop sleeping with god-damned vampires"

The second group, most vocally represented by developer Cliff Bleszinski, is essentially made up of people who saw the Xbox One's policies as a chance to rescue AAA development from the rising-costs-versus-stagnating-sales ditch it has dug for itself. I don't like the attitude of this group, which essentially comes down to blaming consumers for the business problems facing the industry ("we're in trouble, and it's all your fault for not buying enough expensive stuff!"), but their frustration and hostility is absolutely understandable. After all, people genuinely feel that their jobs are at risk in some cases, and even if it's a huge exaggeration to extrapolate that out to the entire industry - AAA console development is a rapidly shrinking slice of the pie - it's still a real concern both for those people and for fans of those games. Moreover, I think the vast majority of people on both sides of this debate agree that there is a genuine problem with the parasitic and intrinsically immoral way in which retail chains like Gamestop and GAME have approached pre-owned software. I fume internally when I see retail stores putting pre-owned games on shelves next to brand new games but a few dollars cheaper, only a week after launch, and I'm not even a developer - if you actually work on those games directly, it must feel like a punch in the gut every time.

Where I differ from this group is in my assessment of what the problem actually is, and how it can be solved. I don't believe that you can fix the Gamestop problem, which is essentially the fault of publishers who frog-marched the rest of the industry into this awful, abusive relationship in the first place, by attempting to take away consumers' basic, long-standing rights to share and sell physical items they've purchased. We are gradually transitioning to a digital market where those rights are tenuous anyway - but that transition has to happen by choice, not by force, and it has to be subject to competitive market forces along the way. People accept the restrictions of Steam because Steam competes directly with other channels (piracy included) and emerges as the best, but not the only, option. Similarly, I spend a lot of money on iTunes, Kindle and Comixology in the full understanding of the rights I'm giving up, but equally understanding that an alternative exists if those rights are important to me (notably, I re-buy many books and comics that I particularly love as physical editions precisely because of the desire to share them).

Xbox One DRM didn't go down this route. It wasn't open to the competition that might have made it into a natural consumer preference (it may well still be the case that a majority of Xbox One game purchases will be digital titles with even stricter DRM than was planned for physical games, if publishers can bring themselves to sort out their blind spot over digital pricing - oh wait, sorry, we're not allowed to annoy Gamestop, are we? That's the same Gamestop that's supposedly putting everyone out of business by being horrible leeches on the industry? Look, we'll all listen sympathetically to your complaints about puncture wounds in your neck when you stop sleeping with god-damned vampires), nor was it respectful of consumer choice and preference. It decided that the future wasn't coming fast enough, and that we should all accept it as a fait accompli regardless of our individual preferences, desires or interests. In an entertainment industry, an industry which intrinsically sells its products based on nothing but individual preferences, desires or interests, that's a pretty horrible thing to ignore.

"Sooner or later we're going to have to confront a big question, legally, morally and commercially, about the ownership of media"

In the wider scheme of things, none of this is going to go away. Sooner or later we're going to have to confront a big question, legally, morally and commercially, about the ownership of media. We're going to have to stop dismissing the question of what legacy of media we're going to be able to pass on to the next generation; of how much we're going to lose, as a culture and as a medium, through blinkered corporate short-termism and the largely passive acceptance of consumers who value convenience over permanence. But this week, here and now, Microsoft made the right call - not because they wanted to address any of those issues, but because they want their console to make money, and that means not handing Sony a big stick and saying "another please, sir" over and over again.

Xbox One still faces big challenges. It's got a $100 disadvantage to begin with, a question mark over its graphical performance compared to its rival and a certain degree of negativity around Kinect being an essential bundled component (although personally I'm keen to see what developers do with that, even if I'm dubious that Kinect is actually going to work in my living room). What it doesn't have any more is a terrible DRM policy that was actually so bad that regular, everyday consumers were starting to notice it; what it has also lost is the painful image of a company utterly deaf to the desires and demands of its customers. Microsoft just executed a brave, if embarrassing, U-turn. Now, perhaps, the next-generation console race can finally start being a real competition.

29 Comments

Caleb Hale
Journalist

150 221 1.5
Popular Comment
Microsoft, I think, was banking a lot on Xbox One being a connected console. If the outright rejection of this policy by consumers translates into the majority of people playing the console free of an Internet connection (and cloud computing), Microsoft is left with a weaker box that's $100 more.

Posted:A year ago

#1

Rick Lopez
Illustrator, Graphic Designer

1,269 941 0.7
Well... when your competitor is selling more consoles, you gotta ask yourself what they are doing and do the same thing, which is what Im smelling from microsoft.

Honestly its not that everyone likes to resell the games they buy, its more about having a sense of ownership. Seriously, why spend money something that has a ball and chain attached to it, something that is not mine? If I just want to expirience it I can pirate it, borrow it or play at a friends house.

And lots a people sell there old games to buy new ones. So I dont understand what this big deal is about used games.

Ive seen entire series and movies on netflix, and if I like them I go out and buy the blu-Ray. I saw an animated series called "Soul Eater", entirely on netflix. Yet that didnt prevent me from going out and buying it on blu-Ray (51 episode complete collection) despite watching it on Netflix in my girlfriends house. I didnt even pay to watch on Netflix, In fact I started watching it on cable TV. Lots of people do that. I Just saw man of Steel in the theater. But Im absolutly extatic, about purchasing it on Blu-Ray.

I think the industry shouldnt be so restrictive, opressive and draconian about there products. They shouldnt be assholes to the consumer. After all people do spend money on them. And most of the times these measures only punish the consumer who puts down money and support the products. The pirate is always gonna pirate. i think if they worked harder to discourage used game sales and piracy it would work better.

You see.... these announcements microsoft is making will work in favor of them... however much work is required... there reputation and credibility has been damgaed. Not just with these draconian measures to control products and monotization, but privacy issues, and the conspiracies surrounding PRISM and sharing info with the goverment.

Going online and digital only has also its issues and costs, server maintenance, updates and infrastucture. Gaining a chunk a change from used games, region locking there console or putting more restrictions wont fix anything.

Edited 1 times. Last edit by Rick Lopez on 20th June 2013 6:22pm

Posted:A year ago

#2
Look at the games too. The Crew, Titan Fall, The Division - all using a persistent online world - not sure how much fun they'll be offline.

Posted:A year ago

#3
Maybe they can have good AI

Posted:A year ago

#4

Paul Johnson
Managing Director / Lead code monkey

799 996 1.2
Good for them.

I can just imagine how much hating they'll be getting for listening to their customers. It's like when the opposition here rags on the government for getting something wrong. If they capitulate and change it, those same hypocrites then call them weak and unguided etc. Just makes me yawn, so once again well done MS. But I still won't be buying one.

Posted:A year ago

#5

Chris Madsen

22 10 0.5
Having a internet connection for setting up the console is still crap for a few. There better be a wireless build-in.

Posted:A year ago

#6

Greg Wilcox
Creator, Destroy All Fanboys!

2,132 1,039 0.5
How do they "deserve praise" when a lot of what they came up with was, frankly speaking a BAD idea for ANYONE not able to have the necessary connections to run the system? I can see if we were in a world where we ALL had the same types of connections, connection speeds and access to them at all times (and NO a damn phone doesn't count as an excuse).

No one should get credit for doing such a bad job or badly bungling something that should have been better explained in FEWER awful interviews and online postings. They should have thought about looking at more of the user base outside those always connected as guess what? Those folks help pay their bills too...

The fact that a good chunk of Xbox 360 users play offline (or like to do so in single-player games) suddenly having to unhook themselves from any loyalties with the company and make a shift over to a competitor thanks to some overly forwards thinking that somehow didn't include them was a slap in the face from the minute that first reveal was over.

I've been poking around on the official Xbox forums for a bit over the last month or so and a lot of the anger there was from users not always connected or not able to get connected in their areas who were feeling tossed away and weren't getting any answers aside from a cheery "buy an Xbox 360"... which (DUH!) was not a good backup plan at all to some of those folks who WANTED to spend their money on a new Xbox at some point in the not too distant future.

Had they come up with a separate SKU tailored to their gaming needs that perhaps had bundled offline games and demo content and was upgradable via Xbox Live account registration (perhaps by PC or phone with that data transferred to the console to activate the system via wifi or some sort of storage media), then I could see MS having an easier time with both ends of their current user base.

As it is, we all know everything they rolled back will be rolling right on back in as soon as the sales are high enough and the tracking gets done through Kinect (STILL an issue for some) that shows users are more "ready" for what they intended.

It's not that this SHOULDN'T happen, it's that forcing it on EVERY user, chopping off the have-nots you feel aren't "worthy" and smugly believing it's for the best was one of the blindest and stupid ideas to come out of this mess and it's going to make some still not re-change their minds to go back to the system even if it's a bigger success than the 360 is.

Short attention spans rule, however... so I could e 100% wrong here (again! hey - we all need a hobby, right?)

But still, if you can't connect or don't want that Kinect, you're not going to be buying in even if the (TEMPORARY) changes now in are seen as a good thing.

Posted:A year ago

#7

Adam Campbell
Associate Producer

1,136 914 0.8
Look at the games too. The Crew, Titan Fall, The Division - all using a persistent online world - not sure how much fun they'll be offline.
Surely people who want to play those games will be happy to have on-going internet connections and buy into them? After all, how would MMO gamers survive?

Posted:A year ago

#8

Paul Jace
Merchandiser

868 1,273 1.5
You know, after E3 and all the mixed messages about DRM and used games for XB1 I said the following:
"The good news for Microsoft is that they will once again have the best console this holiday season. The bad news for them is that it won't be called the XB1 but instead will still be called the 360".

After months and months of rumors I'm still a bit surprised Microsoft went with those stupid restrictions in the first place. I think that the success of the 360 went to their head in the same way that it went to Sony's head after their PS1 and PS2 victories, leading them to have so many problems with the PS3 because they expected their customers to just deal with it. But after all the internet outrage Microsoft made the right decision. I don't care how they came to it(rather it was the consumer outrage, publisher complaints, preorder info or polls), the fact remains that it was the RIGHT decision to make and they do deserve credit for making it BEFORE the system launched. Now they are going to be in damage control until November but with a price drop and a few more adjustments they can go back to being the leading console choice here.

Posted:A year ago

#9

Andrew Clayton
QA Weapons Tester

150 7 0.0
Look at the games too. The Crew, Titan Fall, The Division - all using a persistent online world - not sure how much fun they'll be offline.
I usually have trouble sensing sarcasm, but just in case, I got a chance to try The Crew in solo mode. It was completely empty. It's better than NFS when you have other people playing, but alone it's a vast, empty landscape. I'd be surprised if The Division has an offline mode though.

Posted:A year ago

#10

Paul Johnson
Managing Director / Lead code monkey

799 996 1.2
@Greg. You're right in the overview, but I'm impressed they at least listened and tried to steer a new course based on the outcry. Far easier to brass it out and say "you'll like it eventually" as you often see, especially from giants like MS

Posted:A year ago

#11

Cale Barnett
Animator

29 31 1.1
a question mark over its graphical performance compared to its rival
Really?
Although I'm firmly in the PS4 camp as a consumer, I honestly thought that Quantum Break was the best visuals we saw at E3.
I do realise that PS4 has a few hardware advantages over XB1, but it's really a minor difference in the scope of comparisons.

Posted:A year ago

#12

Greg Wilcox
Creator, Destroy All Fanboys!

2,132 1,039 0.5
@Paul: Yes, indeed, they listened, but i think a bit of user feedback BEFORE setting course to Gilligan's Digital Island would have made MORE sense before they created this future :How Not to Do PR" curriculum.

It's like taking the family, tossing them in a spaceship and saying "we're off to Mars!" and not bothering asking if they really want to go on such a long trip (even though they'll have a hell of a story to tell).

A single SKU with options for offline and co-op play in supported games, tempting on-HDD content to lure in those who could get online but may have been hesitant (or who may/will eventually relocate to better connected areas), the option to disable that mandatory GPS/eyeball AND that future looking focus they were promoting so hard could (and CAN) exist in that box.

Hell, that's exactly what Sony is doing with the PS4. Gradually easing users into their mostly to all online world at their own pace. Microsoft not realizing that you can't push people (or can only push them too far) into the future you want without a push or five back was the move of a company too blind to see this as a flaw in the way they've handled things.

That said... had they rolled out the console in November as an online/offline box as noted above and this mega-plan AFTER the console had launched (say, at E3 next year), I'd bet there would be a consensus that Microsoft "won" on the content/service front with fewer complaints from some longtime Xbox 360 fans upset by the stuff happening up to yesterday...

Posted:A year ago

#13

Jonah Falcon
Writer

26 16 0.6
My IQ dropped a few points after reading that article.

Posted:A year ago

#14

Dan Howdle
Head of Content

277 797 2.9
Look at the games too. The Crew, Titan Fall, The Division - all using a persistent online world - not sure how much fun they'll be offline.
Going online to play these games and being forced online 'just to check that you're still you' are two different concepts, I feel. I personally don't see how any of these reversals in policy negatively effect Microsoft's ability to provide the same Cloud service it planned to in the first place.

Posted:A year ago

#15

Paul Jace
Merchandiser

868 1,273 1.5
@Greg--No doubt they should have done some kind of focus testing before finalizing the original plan. Or at the very least just used good old fashioned common sense tactics. But apparently success goes to people's head in a bad way. Absolute power corrupts, as they say. And although I use my 360 way more than my PS3 and Wii, like most people I wasn't going to blindly support all their stupid restrictions on the XB1. I have no idea why they would have wanted so many restrictions in the first place. Well actually I do have an idea. This was their "before we launch our next all-digital console lets give consumers a taste of what we have in store as far as our ridiculous restrictions that should never be applied to console gaming in the first place" plan. I don't need to tell anyone on this site this, but that plan sucked.

Fast forward to two months of nothing but over all negative feedback later and Microsoft realized something drastic needed to be done to right the ship. Again, I'm not sure which was the final tipping point for them(being made fun of on late night tv, online buyers purchase intent polls, extreme internet outrage even on XBL, etc) but in the grand scheme of things all that really matters is that they listened and got their shit together. So now the features look like this:

-constant internet connection and 24 hour check-in NOT required
-used game restrictions NOT happening
-Kinect can be turned off

They fixed the majority of what really needed to be fixed(before launch) and thats a good thing no matter which way people spin it. It's pretty obvious where they are heading with their next console(I'll bet you an old He-Man figure it's all-digital, all the time) and that will be fine as long as those game prices max out at $30(doubtful) and the console maxes out at $350(again doubtful). But for now I'm ok with the new direction of the XB1. Well, ok with everything except that $500 price point. Hopefully they realize before November that their customers don't want that either. Even a $50 price cut to $450 would be nice. But atleast we are going to get a nice fair console war again, instead of the predicted slaughter they were undoubtedly setting themselves up for with their original plan.

Edited 1 times. Last edit by Paul Jace on 21st June 2013 7:01am

Posted:A year ago

#16

Michael Benfield
Senior Designer

15 12 0.8
@ Jonah

You made it to the end of the article? I gave up at the start of the third paragraph when bias cranked up to its usual level.

Posted:A year ago

#17

Dan Howdle
Head of Content

277 797 2.9
@Jonah & Michael

Why not discuss the points instead of trolling the writer? You seem to share an opposing opinion, but apparently can't be bothered to share it constructively. Which is the point of a discussion, is it not?

Posted:A year ago

#18

Thomas Dolby
Project Manager / Lead Programmer

329 277 0.8
@Michael
You do realise this is an opinion piece right? It's meant to inspire discussion, it's not trying to present itself as fact. Not many opinion articles end up sitting on the fence, and I feel Rob has argued his points well here. As Dan says, perhaps you should try contributing.

Posted:A year ago

#19

Michael Benfield
Senior Designer

15 12 0.8
There is no room for discussion here, just the opportunity to agree with the bias of both the article authors and the denizens of the comments thread. Surely it is the job of this website to provide at least a single alternate opinion?

With two sides given equal coverage there could have been room for a balanced debate, maybe discussing the virtues of the features and the direction that they could have taken the industry in. But no, we get the same couple of 'journalists' hammering home their opinion over and over again, whilst congratulating themselves as the frenzy they created damages the future of our industry.

Posted:A year ago

#20
(posted to a different thread but seems appropriate...) I don't think in consumer terms there's that much between the two consoles so far. Of course there is a lot of talk, and promises of a real difference, and tbh I wish both platforms had their own Steam-like online marketplace. But ignoring the PR it's surely obvious that every developer out there is going to release every next-gen game they can on both consoles. Talking about percentile differences in memory and CPU speed means little to the consumer when the hardware is actually mind-bogglingly similar and 99% of games will be standardised to work on both machines as they have been since the 32-bit era came about. I personally may prefer Sony's attitude so far but MS are a bit like EA, cursed to forever be the golf-playing uncles who are terminally uncool no matter what they do. Price is a factor now but I'm quite sure MS will release an XBOXO model without Kinect that will compete squarely with Sony on price because they are rich and they can, and as Rob pointed out they're not totally dim. So given I can't predict the future anyway, so far it looks business as usual to me and that both consoles will coexist for another 8 years. I'm just glad that the era of platform holder domination over the industry (and esp. developers) is finally giving way - now that IS a success and a real bloody difference.

Posted:A year ago

#21

Dan Howdle
Head of Content

277 797 2.9
Popular Comment
@Michael

It's not the job of either news or opinion to provide every opinion, or indeed every piece of news. You still haven't offered us your opinion nor outlined how it contrasts to that in Rob's article. I, for one, read all the comments in each story and find them just as, and in some instances more, interesting than the article which initially raises the issue or issues.

So, you have a right to reply that almost as many people will read as the article itself. Fire away. I'm interested to know what you think. I am not interested in people whining about an article while presenting no counterpoint.

Edited 1 times. Last edit by Dan Howdle on 21st June 2013 3:29pm

Posted:A year ago

#22
Second hand games and the rental market needs to be stopped. MS were trying to help us, and we have failed to support them more. Now we are left in the same position for next generation and more studios will close. Never mind though GAME/GameStop etc are happy and providing more unskilled jobs for our country.

Posted:A year ago

#23

Sam Brown
Programmer

235 164 0.7
@Jason: True, the shops need to be prevented from indulging in their we-don't-tell-our-employees-to-push-used-over-new-honest-guv policies, but MS's proposed solution hurt both the shops and the consumer. A solution that targets just the shops needs to be found, something that stops them reselling trade-ins a week after release, but still lets the consumer sell them on eBay (not that I can think of anything off the top of my head... :P )

We cannot do anything that reduces the rights of the consumer, or makes things too complicated for them. That's just commercial suicide.

Edited 3 times. Last edit by Sam Brown on 21st June 2013 3:50pm

Posted:A year ago

#24

Andrew Goodchild
Studying development

1,227 388 0.3
If publishers could offer a contract which states they will sell to retailers for 5 less if they agree not to stock that game second hand for six months, could that work?
Game and Gamestop could continue as usual, but then other retailers could undercut them on new, by that 5, which is more than the difference between a new and used disc at Game, usually. This would not hurt any consumer selling on eBay, as they won't be trying to selling new copies, so a trade discount won't affect them.

Posted:A year ago

#25

David Serrano
Freelancer

298 270 0.9
What has operant conditioning taught us about behavior? When the consequence of positive or negative behavior is a reward (such as praise), it increases the likelihood of the behavior being repeated. Because the reward strengthens the belief the behavior is acceptable or desirable. In turn, when the consequence of behavior is punishment; or the failure to receive a desired reward, the behavior is weakened. This reduces the likelihood of the behavior being repeated.

With this in mind, what is the most likely outcome of consumers and the media praising Microsoft for abandoning the plan to facilitate the core game industry's desire to wage war on first sale doctrine and private property rights? The outcome will be teaching Microsoft and its partners there are no risks involved when their goals and objectives directly conflict with the best interests of consumers. They will collectively learn the financial consequences normally associated with engaging in this type of behavior can be avoided by simply acknowledging the error of their ways if caught in the act.

So consumers and journalists have a choice. They can either reduce the likelihood of Microsoft making future attempts to enable 2nd and 3rd parties to attack first sale doctrine and private property rights by punishing all parties involved for this attempt. Or they can praise Microsoft for acknowledging "my bad." But those who choose the latter should do so understanding the praise only increases the likelihood of Microsoft and their partners engaging in similar types of behavior in the future.

Posted:A year ago

#26

Daniel Hughes
Studying PhD Literary Modernism

436 496 1.1
Personally I just wonder how much damage will have stuck before Microsoft have enacted this u-turn. How many people will have heard about the DRM issues, but not that Microsoft have dropped them? Once negative news is peddled enough, it can be difficult to shake it off. Saying that, making this move five months before launch is a great move on Microsoft's part. They've got plenty of time between now and launch to illustrate what's good about Xbox One, and that they were willing to listen to their consumers and the wider industry almost immediately, rather than sticking to their guns. They can also return the conversation to being about software, which is an area Microsoft have obviously invested enormously in. If I've got a choice between two broadly similar boxes this Christmas, and one has more exclusive quality content than the other, I know which one I'd plump for, even if it had a higher price tag. The question for the wider market is whether or not Microsoft's line up will be worth that extra investment, and that's something Microsoft can spend the next five months arguing, rather than being on the back-foot about DRM.

Posted:A year ago

#27

Bruce Everiss
Marketing Consultant

1,692 594 0.4
This whole DRM issue is an industry storm in a teacup.
The real world does not care.

Posted:A year ago

#28
@Bruce -
The "real world" may not care - but it would seem that some very important Microsoft executives care enough to U-Turn and take a whole load of heat!

I am always fascinated by those in the consumer games scene claiming "real world" - when most are now facing being thrown into the Real World as the whole mid-size development studio universe is upended!

If Gen-8 consoles don't take off Bruce I think you will all be seeing a lot more of the "Real World"!

Posted:A year ago

#29

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