Content creators could take a slice of Xbox One pre-owned revenue

Content creators could take a slice of Xbox One pre-owned revenue

By Ben Parfitt

May 24th 2013 at 11:24AM

Microsoft and publishers to take a cut of marked up pre-owned Xbox One games

Content creators may received revenue from pre-owned game sales for Xbox One titles.

Retailers will be free to charge whatever they wish for pre-owned Xbox One games, but both Microsoft and publishers will take a percentage cut of every sale.

Retail sources have told MCV that Microsoft has this week briefed key retail partners on how it intends to take ownership of the pre-owned market.

This is how we’ve been told it will all work:

A gamer walks into a retailer and hands over the game they wish to sell. This will only be possible at retailers who have agreed to Microsoft’s T&Cs and more importantly integrated Microsoft’s cloud-based Azure pre-owned system into its own.

The game is then registered as having been traded-in on Microsoft’s system. The consumer who handed it over will subsequently see the game wiped from their account – hence the until now ambiguous claim from Phil Harrison that the Xbox One would have to ‘check in’ to Microsoft’s servers every 24 hours.

The retailer can then sell the pre-owned game at whatever price they like, although as part of the system the publisher of the title in question will automatically receive a percentage cut of the sale. As will Microsoft. The retailer will pocket the rest.

Unconfirmed reports on ConsoleDeals.co.uk suggest that retail’s slice will be as little as ten per cent. That’s a significant cut from what it has become accustomed to from pre-owned sales and more in line with what they would receive from the sale of a new game – hence, the value of the pre-owned market to the retailer is effectively destroyed.

These same unconfirmed reports also suggest that the activation cost for consumers buying or borrowing pre-owned software will be £35.

When contacted by MCV Microsoft responded with the following statement: “We know there is some confusion around used games on Xbox One and wanted to provide a bit of clarification on exactly what we’ve confirmed.

"While there have been many potential scenarios discussed, we have only confirmed that we designed Xbox One to enable our customers to trade in and resell games at retail. Beyond that, we have not confirmed any specific scenarios. Another piece of clarification around playing games at a friend’s house – should you choose to play your game at your friend’s house, there is no fee to play that game while you are signed in to your profile.”

UPDATE:
Many readers are asking whether the £35 will be additional cost on top of the price of buying the game. No, we believe that the £35 figure – which is not our number, incidentally – would cover the entire transaction. If correct this would leave retail with a cut per sale of around £3.50.

This article was originally published by our sister site, MCV