Did Microsoft Fans Ensure Higher Game Prices By Hating on the Xbox One?


By Tucker Cummings, dealnews contributor

It's been an interesting few weeks for gamers, particularly Xbox fans. After initially planning a host of seemingly draconian online connectivity requirements and restrictive resale policies, Microsoft announced some big changes to its original Xbox One plans in response to gamer reactions. Now, users will no longer be forced to have a 24-hour Internet connection in order to play, and they have fewer limitations on the resale of their used games.

And while some gamers view Microsoft's reversal as a major win, others can't help but wonder if they just shot themselves in the foot. Is it possible that new and used video games would have been cheaper under the Xbox One's original model?

Xbox One Games Could Have Been Cheaper

Microsoft's change of heart was indeed met with joy from many gamers and tech insiders like Matthew Reardon. A member of the marketing team at Glyde, an online marketplace where people can buy and sell video games and other tech goodies, Reardon argues that fewer restrictions on game trade-ins is a good thing for consumers.

"We see people making and saving hundreds of dollars a year because they have the ability to re-sell and buy used games," he explains. "Dropping $60 on a new game is less risky when you know you have the option to resell it. The ability to resell and buy used games allows people to explore different titles and find games they love."

But not all gamers shared Reardon's view. Kyle Wagner wrote in Gizmodo that gamers would likely be paying more money for new and used games on the Xbox One now that Microsoft had shifted its policies. "Publishers know that they will not make money on resold games, so they charge more to the first buyer. You are paying for others' rights to use your game in the future," Wagner explained. "If the old system had gone into place, you would likely have seen game prices drop. Or, at the very least, it could have staved off price increases. You also would have started getting a better return on your 'used' games — because a license does not have to be resold at a diminished rate."

Do Free or Cheap Video Games Make a Fan?

Under the original Xbox One model, users could have played games from a friend's "shared library" for free. Wagner argues that the loss of the 10-person "family share" plan and the inability to share downloaded games with friends is also detrimental to the console. But Glyde's Matthew Reardon sees the whole price scheme differently.

"We see avid gamers buy new games for $60, play them for a month or two and resell them for $35 or $40," Reardon explains. "That really amounts to a $20 to $25 purchase. It was not clear that new Xbox One game prices were going to drop to anything close to $20 to $25 with the original restrictions in place; lower cost games were never guaranteed, [and] the ability to resell through a publisher's hub was left up to the publishers, who may not have followed through."

Reardon also explained that he regularly sees gamers take a chance on a new title, by way of low-priced used games. In many cases, the gamers in question like the used game so much that they buy additional titles in the franchise, often new and at full price. This impulse buy, based predominantly on price, acts as a gateway for gamers to try out an acclaimed game with low financial risk. It may not be the "free" sharing that gamers could have gotten with the Xbox One's family plan, but many gamers still prefer physical discs to downloaded games.

"We're fans of what is less restrictive for consumers," Reardon notes. "Giving people that assurance of true ownership, that they have the choice to turn their things into cash, is a good thing."

In many ways, this year's next-gen console war is the most pessimistic one in the history of gaming. The launch of previous consoles has always been met with enthusiasm and even a certain degree of wonder. And while fans are excited about advancements in graphics with next-gen consoles, an overwhelming number of conversations seem negative and cynical. It was likely this cynicism that influenced Microsoft to abandon its original Xbox One vision, whether it was for the best or not.

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If the Gaming Industry wanted to fix prices and sales woes, they would stop the asinine console exclusive stupidity. Many folks own just one console but would buy the other console's games if they were available.
@montysups I've never heard of this Reardon guy till now. I do trust the people I've bought games from and sold games to on ebay, Amazon and half.com, and the worst problem I ever had was one guy not including a manual in his "like new" game about 12 years ago. Gamestop and its ilk are as much of a pox on humanity as Microsoft's "pay for a physical product but get none of the rights attached to it" scheme, but at least in their case we have thousands of competing options to get the same games, and the pricing pressure that comes with that competition.

I also don't trust Microsoft, and it seems you do. Pity.
This sounds like bollucks.
Also leaked documents showed that "Family Sharing" was literally letting people play demos, not the full game. Google it.
I've never known Microsoft to be generous with their new game pricing, or new anything price for that matter. Besides, you'd think they would at least alluded to a consumer price savings in their E3 conference by marketing the possibility, such as "passing the savings onto the consumer," even if it was an uncertainty.
It's amusing that we offer pure conjecture about what Microsoft and the Gaming Industry "might" do or "might have done" to the cost of games and gaming in general based on whether MS stood its ground or caved-in to the anti-DRM masses.
It is obvious that the nays greatly outnumbered the few who lament what "could" have been, before M$ back-peddled on their DRM down your throat (or up your ...) vision.
M$ now has the chance to sit back, re-look their policy/vision, and again present it to the gaming community in a more tangible and succinct manner-something they miserably failed at during E3.
I am a fair weather gamer and do not buy games on first release-I live purely through CL, buying from friends, etc.. Game stop is for the immediate self gratification in all of us and, consequently, we pay for that urge.
I think, in the end, I will eventually own the XBone; but only after observing all the early adopters comments, feedback and, of course, the cost of new games...
I don't get the outrage over the alleged lack of digital distribution in the "redesigned" Xbox One. Isn't Xbox Live a capable enough platform for that? You can have your choice of both tradeable/resellable physical media and digital purchases in the same console now. How is that a bad thing? I have a PC and love Steam too, but I would like my console to stay a console. Microsoft was blurring that distinction with their original offering.
BTW, how do you trust Reardon? He makes money off the used game market. Of course he'd be upset about restrictions.

It's basically going to come down to this. What's more important? The consumer's rights to purchase a game & resell it OR the right of the developer to get paid for creating the product in the first place. If Reardon's company and/or Gamestop would cut the developers' into the used game market sales, we wouldn't have any DRM being discussed.

But they won't because the pure greed is coming from these "resellers".

The 45 minute demo thing was busted as a false rumor that was pulled off a pastebin post. I will believe what was in black & white on Xbox's one website:

The original post on news.xbox.com has since been updated
with the 180.

The block quote below was taken directly from the old xbox.com article was as follows:

Give your family access to your entire games library anytime, anywhere: Xbox One will enable new forms of access for families. Up to ten members of your family can log in and play from your shared games library on any Xbox One. Just like today, a family member can play your copy of Forza Motorsport at a friend’s house. Only now, they will see not just Forza, but all of your shared games. You can always play your games, and any one of your family members can be playing from your shared library at a given time.

Pretty straightforward to me. I thought it was too good to be true, but there it is. We'll never know now.
@montysups: The "digital sharing" you describe amounted to being able to give away a copy of your game once to someone who's already been on your friends list for a month, or letting anyone in your "family" play a 45-minute demo. Any other sharing functionality is unannounced wishful thinking.

Thanks, but I'll keep my discs (probably not on the Xbone, though).
No way the "digital only" ones that you cannot share or resell would be cheaper. They would be $60 still at best I am sure.
I like having the ability myself to go on eBay a month or two after a game is released and get it cheaper than the $60 it still is at Best Buy, and then be able to resell it myself another month or two later if I am finished with it.
A business does things to make MORE money, Microsoft would be making a killing on that system they had in place. To think they would be saving consumers money is a joke.
Microsoft's change of policy speaks more to the power of consumers, which are the people that should have the power to say we don't like something, so change it. We shouldn't be held hostage to a ridiculous policy that would force us to spend more money and not have any freedom in the process of selling/trading. Could you imagine only being able to sell your car back to the dealership you bought it from?
New prices would not drop, but 3 to 6 months down the line you would've seen those same games cheaper. XBL has a game sale right now. Borderlands 2 for $10.00, AC3 for $15.00, Far Cry 3 for $20.00.

Steam like sales for consoles. Now this will be regulated to a once/twice a year thing instead of the norm. Good job internet. Not only have you stifled innovation, buy thanks to the narrow minded negative bandwagon jumpers this console generation will be like every one before it.

Digital sharing would've been 100 times better than physical.
I look forward to seeing the rock-bottom Steam-like sales Microsoft has on the download versions of all its games. If they don't materialize, it demonstrates once and for all that moving to digital is only about doing an end-run around the rights consumers have in our society, not lowering prices for their customers. After all, having a much higher-priced disc available will demonstrate how much better of a deal the digital download is... right?

As valle07 below points out, they could have had these rock-bottom sales already, and they haven't. So there's no reason to expect them to happen on the Xbone, and there certainly wouldn't have been if Microsoft had the absolute control over pricing that the lack of used, rented and traded games would have allowed them.
If Microsoft wants us to go digital so badly then give us some incentive! "You can buy this newly released physical copy for $60 and be able to trade it, lend it, break it, whatever you want. OR...you can buy this digital copy for $40 but you only have a license to play the game not resale it, lend it , or trade it. I'm willing to bet that more people would go for the cheaper route.
Best case scenario, we start to see steam like sales. Though with Microsoft, that may be a Pipe Dream indeed!
New game prices aren't going down. Kyle Wagner is delusional
It's highly unlikely that consumers would have saved money if Microsoft had maintained monopolistic control on the used Xbox One game market. (Flies in the face of basic economic theory.)

And the idea that publishers would lower initial prices in the expectation of higher *future* revenue is a great example of a PIPE DREAM!
It's highly unlikely that consumers would have saved money if Microsoft had maintained monopolistic control on the used Xbox One game market. (Flies in the face of basic economic theory.)

And the idea that publishers would lower initial prices in the expectation of higher *future* revenue is a great example of a PIPE DREAM!!!