Microsoft Did The Right Thing, And Everybody Won

I have to admit, it was exciting. It was a kick watching "evil" Microsoft get its arse handed to it by gamer-loving "good guys" Sony. Sure, that was a gross oversimplification: It was really just two profit-minded corporations duking it out. But last week's E3 provided the sort of dramatic, good-vs-evil narrative that we rarely get anymore.

Today, Microsoft did the right thing. It listened to consumers and finally acted like the good guy. And that's not just a PR win for Microsoft. It's a win for everyone.

Earlier this afternoon Microsoft's Don Mattrick announced a sweeping, unprecedented about-face for the Xbox One's controversial and unpopular DRM policies. Among the policy changes he announced: you won't have to connect your Xbox One to the internet every 24 hours to play games, you can loan physical games to your friends, you can play the Xbox One in any country, and you can buy and sell used games.

In other words, in a lot of ways it will work just like the Xbox 360. Hooray! Things are staying the same.

It's not all rainbows and sunshine. The neat-sounding "family share" plan, which would let you license up to 10 Xbox Ones to play your games, iTunes-style, is also no more. You also won't be able to have your full game library travel with you. We've no word yet on whether or not indie developers will be able to self-publish on the Xbox One like they can on the PS4, nor on the system's onerous Kinect camera requirement. And the Xbox One still costs $US100/$A50 more than a PS4, though a Microsoft spokesperson told Kotaku today that, "We are very confident with the value we provide at $US499/$A599 and the unparalleled, all in one games and entertainment experience that Xbox One offers."

But even taking all of that into account, it's a massive turnaround for Microsoft and the Xbox One. "Xbox 180" indeed.

The Xbox One makers were doubtless driven to make these decisions by last week's E3, where a feisty Sony directly took on Microsoft's DRM policies during Sony's E3 press conference. Sony's Jack Tretton stood on a stage and proudly announced that the PS4 would support used games and, in a direct shot at Microsoft, wouldn't have to check in online every 24 hours. The crowd went apeshit. Then Tretton announced the PS4's price at $US399/$A549, $US100/$A50 lower than Xbox One, and all but dropped the mic while walking off stage. In a manner of minutes, Sony "won" E3.

Microsoft's swift(ish) response is welcome, if overdue. Ever since the Xbox One was first announced in May, it's felt like watching the gang who couldn't shoot straight. And one of the worst parts, as someone who really likes cool video games, has been knowing that there would doubtless be some neat stuff going on with the Xbox One, but that that stuff would keep being overshadowed by Microsoft's idiotic DRM policies. Now, hopefully, we'll get to start talking about the interesting things the Xbox One can do, rather than talking about all the stuff we wish it didn't.

At E3, there were some really cool things going on in Microsoft's booth, but no one was talking about them. Project Spark sounds like a fascinating idea, but I've seen next to no one talking about it. As I sat there in a back room of the Xbox E3 booth watching an absolutely batshit (in the best way) demo of SWERY's episodic mystery game D4, I couldn't help but think, "Dude, there's some good stuff happening on Xbox One!" But nope, no one wanted to hear about it. And with good reason. As long as Microsoft kept on going as it had been, there's a good chance no one would have.

Today's decision, like the original decision to add DRM, was doubtless made so that Microsoft will make more money. Sony's decisions were made for the same reason. Both of these companies are competing for your dollars, and, in theory, both want to give you a reason to buy their respective box over the competitor's box. Today, it seemed like Microsoft finally figured out that the best way to convince consumers to buy its product is, well, to make consumers think you care about it in the first place.

It remains to be seen what kind of impact the various Twitter campaigns and negative press had on Microsoft, and what exactly drove it to make this decision. And not to sound crazy cynical or anything, but it's a safe bet both Sony and Microsoft (and Nintendo, and any other gaming company or publisher) will continue to try to get as much money out of their customers as they can get away with.

Competition between the console makers may once again concern itself with who is doing the most things that customers want, rather than the fewest things customers don't want.

But today's reversal levels the playing field substantially, and that's great news for everyone. Soon Sony will once again have to say, "Well, sure, the Xbox One has this feature, but now we're gonna have that feature!" And Microsoft can counter with some other feature. (And Nintendo can say, "Yeah, but check out this new Zelda game!") And competition between the console makers may once again concern itself with who is doing the most things that customers want, rather than the fewest things customers don't want.

(And hey, maybe now all of those companies can start to come up with reasons we shouldn't just buy a living-room PC or a Steambox. I'm waiting to hear it, guys…)

It would be hasty to say that Microsoft is out of the woods. It got itself into this mess, after all, and it did so fairly recently. The company seems to lack the sort of leadership that would have stopped this kind of clusterfuck from transpiring in the first place. From the moment the Xbox One was announced, its messaging has been a mess of corporate-speak, contradictions and vaguely menacing obfuscations, wandering around aimlessly and pissing off everyone it stumbles into.

Compared to Microsoft, Sony appears poised and ready, a company with seemingly strong leadership and a number of clearly defined goals. It has set out to win over developers and land exclusive games and content, it has a robust indie recruitment strategy, and it seems to take its customers very seriously. (Or, at the very least, it takes courting its customers very seriously.) Microsoft, with its bumbling TV-TV-Sports-Call of Duty announcement event, weird pre-E3 info-dump, and let's-not-mention-the-elephant-in-the-room E3 press conference seems to be more of a leaderless bureaucracy.

So I'm certainly not ready to start putting money on Microsoft just yet. That said, with a single press release, it has pushed itself off the ropes and gotten back into the fight. Maybe now it will start throwing punches of its own, telling us in clear language why its console is better than Sony's. (And will Nintendo get involved? Or is it content to stand outside the ring, doing its own thing as it has for almost a decade?)

It's been exciting watching Sony kick Microsoft's arse, but a fair fight will be better for everyone in the long run. Grab your popcorn, this should be fun.


    If the game sharing thing is true (they were basically demos) Microsoft saved itself from even more backlash. I think people would have rioted if they never let that information out.

      Very true, even though I always strongly favoured the Xbox, that family sharing thing really was too good to be true. Microsoft would have copped it hard for building up expectations like that.

        I always thought there was more to it. I could never see how the Publishers/Developers would agree to the idea you could share games with 10 people. The loss of potential profit is too much.

          Pretty much. I know people have been using that as a pro of the Xbox One before the reversal, and are subsequently attacking every article that says its a change for the better (where were they when Xbox needed it), but its a difference between 100 dollars for one person sharing it, and 1000 dollars for 10 people having to buy it, there is no way MS would give out that kinda money.

            100 dollars for one person sharing it, then $100 x 10 for Xbox Live Gold memberships so each person can play it, then $5 x 10 for incidental buys for a couple of months, then the next years gold subscription then, then 1 of the original 10 buy another game, but share it with 8 different people......

          It does seem incredibly strange to be fine with one disc equaling 10 licenses after they've gone through such great lengths to prevent a person with an online account from installing the game, linking it to the account so they no longer need the disc, then giving the disc to a friend with an offline account.
          Hell, they'd have to be insane to have the 10 copies thing up their sleeve and not use it when they were facing the massive 'but how does this benefit anyone but you and the publishers?' backlash.
          Now it's pure speculation people seem to be assuming the absolute best case scenario.

            Err, it was actually 1 license (could only be run on one machine at a time). Just like passing around the DVD, which they've now let you do - with more than ten people!

          Exactly, I cannot see EA or anyone infact, being ok with losing potentially 10 sales so 1 person can share with 10 others. It is purely illogical from any possible business standpoint.

            Oh, I had discussions with people (see: fanboys) on how this would maximise their profits.

            Last edited 21/06/13 3:56 pm

              Yea, because people can't now share their disks 20 times and no one loses profit!

            Isn't this happening right now?

            Publishers & Developers are see nothing from the sales of trade-ins. And yet the lions share of profits for retailers come from trade-ins. On top of that, if the game is has a multiplayer element, the publisher/developer is expected to carry the burden of paying for the maintenance only from digital and initial retail sales.

            I read a quote from CliffyB: "I have seen the number of unique gamer tags vs actual sales numbers and it ain't pretty."

            I don't know what actual figures are, but if the ratio is more that 10 gamertags per actual sale, then the sharing would make good business sense.

            I believe that trade-ins, while providing a minimal short term benefit to the consumer, is really an anchor around the gaming industries neck in the long run. This is what worries me.

              Indeed, noones saying used games are a safety net but lets look at the reality of things, the average game is resold what, 2 - 3 times? Ok lets jack that up to 5 - 6 times.

              5 - 6 = 100 in the hand for the company, 500 lost for the company potentially. (EB pricing lol)

              Share 10 games? 100 paid. 1000 lost when 10 people have it shared.

              It's the same method, just relabelled. You're 'trading' games with each other, but on a grander scale this time. I cannot in any way shape or form see how a company could recoup from this without ending up charging another form of online pass, sorry.

                I think you might be underestimating how often one can game can get traded-in. I can see it passing through 10 hands over the course of a couple of years.

                Especially when staff for retailers are encouraged to push the trade-ins over the full priced games. And frankly, who doesn't want to pay less for games.

                I'm really curious now about how many times a game will be traded in.

                FWIW. I've never traded-in any of my games. And I have purchased a few in my days.

                  Not underestimating at all. We've got family members who have worked in EB, I used to work in a shop called GAMES R US in Brisbane, we were one of the first shops doing trade ins for PS1 and N64 games, those averages are fairly accurate. Personally, asides from the entitled gamer aspect of 'But I wanted free games!' I don't quite get people being pissed at losing the 10 people sharing thing. Now, you can easily share your disc to 11+ people :P

                  @weresmurf Not sure why I can't reply to your post...

                  I don't quite get people being pissed at losing the 10 people sharing thing. Now, you can easily share your disc to 11+ people :P

                  Not pissed, disappointed.

                  Being able to digitally share disc based games with friends and family across state/countries is quite a useful feature. I don't get to share games with my friend, so I was looking forward to taking advantage of it digitally.

                  I don't know 5 people, let alone 11 that I'd trust enough to lend a game to. But digitally... have at it!

                  Except now its come to light it was actually loaning, it was more a demo service. Ah well. Had a feeling no publisher was likely to agree to such a financial loss...

          Although details were slim, my understanding is that only two people could play the game at once - the person who actually bought the game (registered it first?) and any ONE other person.

          It wouldn't be that much different to buying a game and passing the disc around amongst your friends.

            That was the plan (as far as I knew) but the difference in the sharing with friends and this is that, your friends can be anywhere in the world and access it at anytime and never have to give it back.

            I mean, how often have you ever shared a single game with 9 other people?

            Actually only one person would be able to play it. It would be a digital version of someone taking your disc home with them, just instantly, and no matter where they are in the world. While my buddy is borrowing it, I can't play it unless I take it back off of him.

            But I could have up to ten "family" members, and each of them could borrow the game in sequence, or be borrowing one of my games each - so Jose over here is playing my copy of Halo 7 while Pepe is enjoying some Fable 9, etc.

              I'm sure I read somewhere that the primary licence holder always had access.

              Anyway, my point was more about people saying Microsoft would lose too much money. With a physical copy, there is no restriction on how many times I can lend (or even sell) the game, and they still only get a cut from that initial sale.

              I don't think it would have cut into their profits that much.

                There was some confusion on that score. According to an interview with Phil Spencer at Penny Arcade, he thought it was 2 people, but wasn't 100% sure and urged them to check the licensing agreement. Both Penny Arcade and Ars Technica did, and concluded that their reading of the licence was that it was indeed only one person at a time - basically a digital version of sharing the disc between a group, but without the limitation of having to physically exchange it.

                Last edited 21/06/13 2:02 pm

        Agreed. I understand some people were optimistic about family share...but we have to be realistic when talking about big corporations, They were never going to allow such huge losses of revenue like that for nothing.

          Don't get me wrong, I was suckered in! I thought it was too good to be true but believed the hype anyway. I feel pretty let down that it turned out to be as not true as the too-goodness implied.

          But I guess that's in the past now, and I'm still sticking with Xbox. If both consoles are now basically going to be shiner versions of the current gen, then I still prefer my 360 to my PS3, so... that's just what I'm gonna do.

          I think their argument for the whole family share thing was that in the end the majority of discs go through around 10 owners or players (separate accounts) anyway. Obviously not all discs and games change hands that many times but some would change hands more. That's the number they put on it. 10.

          With the family sharing it gave the consumers more and easier opportunities to buy the product (GoD sales, sales weeks for publishers, you know, like they do now on xbl) license and then they could potentially get back some of the sales that the used game shops have made over the last couple of decades.

          Im not saying it was a good move for every consumer. I know for some people the ownership of games has always been a disc rather than a license, while others understand that there was no other way of getting that much content to people with world wide distribution. Back in 2005 it had to be discs. Saying that not everyone can afford reliable, unlimited net. Obviously there are tonnes of gamers that cant even afford a once a day connection, because they turned out as the vocal majority.

          I wanted the family share, even if it was just with one irl friend. The once a day check in and not being able to hand a disc to just anyone was a minor price to pay in my book. To me now the only reason to get the Xb180 is for the couple of exclusives that I like... And of course the ever reliable XBL servers. Never failed me so far. Ill get the sony also because they are supporting indie self publishing and Gaikai backwards compatibility will eventually mean I can buy my fav PS1, 2 and 3 games that Ive been missing lately.

            Actually what me and Matt were referring to was that family share "may" very well just be glorified demos, where up to 9 other people gets an hour to play your "full game", after which they will be kicked to the marketplace and prompted to buy the game.

            So its not as you describe. Essentially, family share just waves a piece of candy in your friend's face saying "ooo look at this candy! mmm its so sweet, look at the texture, you like it don't you?" then as your friend reaches out to grab it, FS quickly gobbles it up and says "well go get your own"

            EDIT: where I sourced it statement from

            Last edited 21/06/13 2:27 pm

              Ouch and goddamn... great link, thanks. So it's realistically just a glorified demo service. I can see benefits to that but can also see the drawbacks too. Either way imho in that case, not much is lost given the fact it's just a demo service essentially.

              When your family member accesses any of your games, they're placed into a special demo mode. This demo mode in most cases would be the full game with a 15-45 minute timer and in some cases an hour. This allowed the person to play the game, get familiar with it then make a purchase if they wanted to. When the time limit was up they would automatically be prompted to the Marketplace so that they may order it if liked the game.

      Thank heavens some other people around here see sense. I made this argument several times yesterday to just get absolutely dog piled by an angry mob.

      If they were only sharing "demos", why only let one person play them at a time?

        Yup — and why make the DRM check every one hour?

    I'm wondering if the damage has already been done and people who weren't going to buy the Xbox ONE still won't.

    It’s been exciting watching Sony kick Microsoft’s arse, but a fair fight will be better for everyone in the long run. Grab your popcorn, this should be fun.

    Should be fun? Both consoles have a camera, both consoles can use touch input, both consoles have near-identical hardware, both consoles share the vast majority of their game library — all that's happened is we've lost any real point of difference between Microsoft and Sony, and we'll spend the best part of the next decade in the exact same Sony vs. Microsoft (vs. Nintendo) circle-jerk between loyalists that we've had for the past 8 years.

    "Fun" would have been something new. "Fun" would have been letting Microsoft screw up in a colossal way, if that's what would have eventuated. This isn't "fun." :(

    Was a great move.

    Xbox 180 > Xbox One

    Microsoft fanboys were outraged when I suggested that it is doubtful the family share feature will let you and 9 of your friends play the same copy of the game (although not at the same time) and there is likely to be more to that story. HMMMhahahahaha ha!
    Edit: Now where are thetim and jerrys88... ^^

    Last edited 21/06/13 11:34 am

      You are probably correct. I was expecting it to be at the most, You and one of your friends playing a game at a time.

      You know this game sharing could have opened up sales opportunities. You get sick of competing with a mate trying to play another mates game, so you just buy it yourself. Or maybe all three of you want to play the same game together, so you fork out for a copy yourself.

    I still find this reversal a bit fishy. I think Microsoft knew Sony will outgun them at E3 so they needed something to get their box back into the spotlight after Sony's glory has died down. The reversal seems to be a while in the making.

    I love making conspiracy theories.... I'm still buying a PS4, Microsoft has always been dead to me

    Last edited 21/06/13 11:38 am

      From what I'm seeing, the consensus is PS4 for the vast majority of people. Although I think this has put the spotlight back on the Xbone, it's definitely left a bitter taste in peoples' mouths. No doubt loyalists will get ONE, but a lot of average people feel betrayed.

    I would never return to XBOX out of principle. It's like a battered wife returning to their husband because he says he's sorry and it will never happen again... only it it does happen again. You can't honestly think that Microsoft won't pull this crap again?

    The disrespect Microsoft has shown for gamers is unforgivable.

    Microsoft didn't listen to the gamers. They listened to the shareholders who were scared of losing all their money. Microsoft spent 8 years developing these ideas and concepts and implementing them into a working function, now 6 months from release they have to throw together a new licensing concept for their system which no doubt would have been incredibly powerful and useful for the large majority of us. Great. I hope they can get something sophisticated and strong rebuilt in time because i'm sure there had been A LOT of investment and research/implamentation put into their new OS.

    People are idiots. That's all I have to say. All their bitching and complaining have held back the industry from progressing and staying in this less digital stage of ownership. if you didn't like what the xbox had to offer then get a playstation, clear and simple. It's Microsoft's console not yours. Believe it or not, sometimes large companies change their ideals and principles to aim for a direction they see fit. Microsoft is STILL going to implement most of these options after they get their console released in minor updates. Their changes are inevitable. it was a very large change from our current generation and people got scared.

    Maybe in the long run it is better if Microsoft slowly implement their new platform features instead of throwing them all in at once on release day. It will alienate less people while they update the system.

      "If you didn't like what the Xbox had to offer then get a Playstation, clear and simple"

      I think that this is the main reason Microsoft changed tracks, because there was a large shift in the consumer base towards the Playstation after Sony capitalized on MS massive PR trainwreck.
      Microsoft are in this for profit, not to push technology boundaries, If the bulk of their potential customer base is unwilling to embrace their product then it is a failure no matter how innovative it might have been, remember the Dreamcast.


        You really think the "bitching" as is colorfully phrased caused the turn around? Gamers have been "bitching" since time in memorial.

        The difference here is that no one was willing to buy the console. Preorder numbers were horrible for XBOne and it's obvious what was causing it. All the "negatives" were too much of a deal breaker for the average gamer. Not the really loud "ZOMG! XBOX FAILS! SONY FER LYFF!". Where talking about people who saw what it was "offering" and saw only negatives and did not opt to buy. And guess what people went and "got a Playstation, clear and simple". So much to the point that XBOne's marketshare would have been insanely crippled this early in the consoles life. It might MS's "product" but it still needs to sell. Their marketing *should* have been ready to counter the evident backlash. Instead they were banking on the fact that because its MS we would be willing to "take the leap!"

        It's been mentioned far too many times already but gamers are willing to put up w/ inconveniences as long as they see a positive trade off. Unfortunately anything "postive" from XBOne was either limited (ie. worked only in US) or far too vague/speculation. People don't work off "maybes" when it come to comparing pros vs cons. Especially when its a luxury item.

    I for one did not mind the really minuscule drm for the benefit of sharing my entire game library with 10 of my friends. Not the xbone is just a less powerful ps4 with a camera I have to hide my paraphernalia from.

    The media:

    "Xbox is evil because DRM"
    "Hey guys, Xbox isn't so evil just because DRM"
    "Microsoft backflips on DRM because public and good"
    "Is Microsoft's backflip because of public and good REALLY all that good?"

    Meanwhile, in the PS4 court:

    "PS4 is good because not DRM"
    "PS4 beats Xbox because not DRM and nice guy"
    .. instead of:
    "PS4 is evil because court order for PayPal donations and website visitor IP addresses"

    Today, Microsoft did the right thing. It listened to consumers and finally acted like the good guy.

    No. There is a massive difference between "acting like the good guy" and "acting like not-a-bastard". Good that they've backed down, but don't give them credit for it. They've returned to the status quo, and had a small hissy fit with removing some projected features along the way.

    Still not getting an xbone

      I laugh at people who have to clarify this. Well done. You're making a choice. You deserve praise.


    Does Kinect still need to be plugged in and always watching and listening?
    Thats my biggest concern with the Xbone180.

      Totally agreed. I was against the DRM in principle but in reality it wouldnt affect me too much. That camera on the other hand, that has me worried.

    Why is everyone so scared of the future! Every wants next gen but no one wants anything to change! Now we are stuck with a minor upgrade instead of something that could of truly revolutionised gaming!

      How? By letting one other person play a demo of a game you own remotely?

      The cons far outweighed the pros. MS has made the right choice.

      Last edited 21/06/13 3:21 pm

        The changes go far beyond the cloud, or even the console itself... The changes that devlopers could of implemented in our games could have changed the way we think about gaming! Imagine game worlds that are constantly being changed adding new things constantly and all of this being done automatically without having to pull us out of the game world!

          But they can still do that. There's nothing stopping developers putting this stuff in their games.

      I could go into an insane hyperbole on your supposed great "future" here...

      But that would be counter productive. The main issue w/ MS on the "advantages" was as the reliable Magic 8 Ball says - "the future looks cloudy".

      If your going to remove a feature as a consequence of "the future" you damn better have something concrete and ready to convince the nay-sayers... obfuscation by pointing at the "new shiney stuff" (ie. TV) seldom works.

    "Microsoft Did The Right Thing, And Everybody Won" WRONG!

    That's the way I see it, too. Not being in favour of their approach isn't inherently anti-future, either. At worst, it's anti-Microsoft's vision of the future, which isn't automatically right or good and exempt from criticism. When your vision says that it excludes people based on where they live, how they use the Internet, and how they can share content, I'd argue it's not a very good vision. When your answer to the question of what happens to people who can't meet that future through no fault of their own is "buy something else", that's not great either. Particularly when you then cave in because they actually take that advice. Amazon's vision for eBooks co-exists with the way people share the printed word. Apple's vision for DRM-free digital distribution of music still hasn't quite managed to destroy the CD ten years on - they still co-exist. Microsoft over-reached, trying to dictate a future to consumers - some of whom were either excluded from or worse actively prohibited from participating - rather than convince those consumers that it was a future worth following. Instead of encouraging a change of approach by providing incentives, they demanded it by dictating terms. It would've been so simple, too - their future vision for content-sharing could've applied to digital content while leaving on-disc content with the same "DRM" that applies today.

    Update: Particularly now that there are claims that a Microsoft employee revealed today that the sharing feature would've limited gameplay to 15-45 minutes per game, with the friend then being presented with a "Buy Now" option and taken to the XBL Marketplace. Sounds like they would've then been able to go back to the game, but there were attempts to limit the number of times you could do it, making it basically a demo.

    Last edited 21/06/13 5:25 pm

    This is an excellent example of the market at work, companies tend to listen when people vote with their wallets case in point if you look at the pre-orders Sony was demolishing Microsoft and I feel that was the main reason why they did the 180.

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