Could Microsofts Rumoured Pre-Owned Plans Be Illegal?

HUGG Writes: Unless you have been living under a rock for the last few days, you will have probably heard about the rumoured Microsoft plans that charge customers for the privilege of playing pre-owned games.

The rumoured plans include taking a cut of used games sales at high street retailers as well as charging a fee of £35 to activate a game on your own system if the game had been previously activated else where.

This news has rightfully caused quite a stir and Microsoft have done nothing to stem the flow of criticism, only confirming their intent to "enable our customers to trade in and resell games at retail" but "beyond that, we have not confirmed any specific scenarios."

After getting a bit of a bee in out bonnet about it, something didn't sit quite right with us, so we decided to do a bit of research in the legality of these rumoured plans.

The results may suprise!

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Majin-vegeta2506d ago

God I hope so.

It's funny how other companies out their don't b*tch about used sales.Except the video game indsutry.

I don't see Ecko complaining when someone sells one of their shirts at a yard sale.Or a car company asking for a cut when someone sells their car off to someone else.Or the movie industry asking for a cut when someone sells a movie etc...You get my point.

These people just wanna get payed twice for a game.Damn greedy bastards.

zeal0us2506d ago

They are being greedy for a reason because we all know these multimillion/multibillion gaming companies are shutting down left and right due to used games /s

darthv722506d ago (Edited 2506d ago )

you are confusing 2nd hand "private" sales with those that must be reported.

yard sales are private sales and the money from those are generally not reported as any type of profit to the government.

Stores that sell merchandise have to report those sales. its how they are taxed on the profits claimed. Even car dealers must report any sales of 2nd hand vehicles to the government and ultimately...the mfg themselves.

so yes, ford, chevy, toyota...they know how many vehicles are purchased new as well as used and yes they do get a small percentage from each sale. Its all contracted into the fees we pay at the dealer.

To avoid paying to those bigger companies, thats when you do a private sale. sell your car to another person or sell your items at a yard sale and you get to keep all the $$.

As far as retail stores for used games. Bigger places like Gamestop have codes for every game in their inventory. They know how many copies exist and how many have been sold.

Zcarnut2506d ago (Edited 2506d ago )

Darth...I AM a used car dealer. When I sell a used Toyota or whatever? The manufactuer doesnt get jack from me LOL. In my state, I collect a "road use" tax and fees for registration/title,and tags. Its all State fees. The only thing a manufactuer does with a used one is periodically collect registration information. They only do that for the purpose of putting out recall notices if the vehicle has or may get them. Ehh..They may also collect it for advertising purposes,but i'm off topic enough as is LOL.

I'm not saying I disagree with your point,just thats not a good example.

darthv722506d ago

i stand corrected. Perhaps its different for every state.

thank you for that. have a +bub for being helpful.

Dj7FairyTail2506d ago

Nintendo doesn't
they only care about people not buying them

One4U2506d ago

this is what happens when the 2 most money grabbing companies team up !

rainslacker2506d ago (Edited 2506d ago )

I hate to hijack your first comment with something off your topic, but I felt this would be appropriate where everyone could see it. Please forgive me.:(

Here's how it works in software. We can thank the courts for leaving this up in the air, and not having a actual stance on the issue for God knows what reason.

With most software purchases, you are not buying the actual code. The disc you receive is nothing more than a distribution medium, not unlike a download.

What you are purchasing is a license to play the code in the manner it is intended, such as on a game console. Because it is a license, you and only you are eligible to use it, and in most cases it is considered non-transferable.

So far, for the most part, the actual license is attached to the disc. So when one trades/sells a disc the license is sold with it, along with the distribution method. They are intrinsically linked. Basically, if you have the disc in possession you have permission to use the code and license. So 2nd hand sales continue.

With this new thing, the license and the distribution method are separated, the way they were always intended to be, much like DD. What you are buying is the license and the use and ownership of that license is outlined based on what the provider wants(The TOS), and stipulates whether or not you can transfer it to someone else(You usually can't). As such, MS is within their legal rights to charge for someone else to use it, or to charge to facilitate the transfer of that license to another person(the fee in this case), or worse yet strip your right to use that code at a moments notice(account ban for instance). The physical distribution medium in this case is just a convenience for the retail shopper, or for those that don't have fast internet...or whatever.

MS has been doing this for quite some time with their retail releases of their software packages and OS's. It's nothing new for them. In this case, the license is attached to a person(account actually), whereas their software packages are attached to a machine.

This is why it's legal. Not a moral judgement on whether it's ethical. Another thing to note, the EU ruling on DD resale is a step forward in ownership rights of software, however even Steam has taken measures to circumvent it, so it's not going to be a simple issue that is easily resolved.

2nd Note:
On the stripping away your rights to use the software, this could get hairy if all licenses were taken away from a user. There is an expectation among the consumer to be allowed to use their product based on the terms of sale, and that term of sale does not always extend into the terms of service. Again it's a tricky issue, but Steam did it with their users by forcing them to accept a new TOS or lose access to their games. I'm not aware of any litigation over that issue, but the courts may have sided with anyone who brought a case because of it. Again, not trying to debate the morality or ethnicity of this, just pointing it out.

+ Show (1) more replyLast reply 2506d ago
zerocrossing2506d ago

If it's not now it only should be, we're not talking about devs getting a fair cut of what they earned, this is greedy publishers trying to pilfer money from individuals who already paid for or came into possession of a used game through legal means and therefore have every right to its contents.

SexyGamerDude2506d ago

It's not a rumor. It was confirmed in a interview with Adam Sessler. It's on YouTube. They are following through with the fees.

zerocrossing2506d ago

I'm absolutely disgusted by this news, I feel bad for sayng this but I really do hope MS fail big time this gen.

Omac_brother2506d ago

Microsoft announced a statement earlier today so say "they have a plan for pre-owned games but no details have been decided or confirmed" so we are still classing it as rumour till we hear otherwise.

ApolloTheBoss2506d ago

That's a little thing called Damage Control, my friend.

Yodagamer2506d ago

I think it is legal.I recall something saying we have the rights to play the disc, but not to resell it, reproduce or use for public use unless covered by the faire use act

DarkBlood2506d ago

thats entirely suggestive i mean i have a motorstorm game from the original ps3 phat 80 gb limited model that has a little red "not for resale" and something like that on my zelda collection for gamecube yet i saw those in the store

i dont think even that can be implicated well

madpuppy2506d ago (Edited 2506d ago )

"The first sale doctrine, codified at 17 U.S.C. § 109, provides that an individual who knowingly purchases a copy of a copyrighted work from the copyright holder receives the right to sell, display or otherwise dispose of that particular copy, notwithstanding the interests of the copyright owner. The right to distribute ends however, once the owner has sold that particular copy."

tiffac0082506d ago

Interesting point, something a consumer should consider before purchasing.

jc485732506d ago

any lawyers around here?

zerocrossing2506d ago

My sisters a law student, that count?.

jc485732506d ago

well, pay attention between now and then. probably someone can break the tip of the ice with some kind of policy for the new XboxOne.

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