E3 2013: Microsoft Defends The Xbox One’s Licensing, Used Game Policies And More
Microsoft’s Xbox Chief Marketing and Strategy Officer Yusuf Mehdi has defended the Xbox One’s policies and the company’s way of doing things, which makes me again wonder whether these policies will be dramatically changed in any way. Altered in various ways, perhaps, but I do not think they’ll be significantly changed. Not to mention Don Mattrick said get an Xbox 360 if you don’t have internet.
“This is a big change, consumers don’t always love change, and there’s a lot of education we have to provide to make sure that people understand.”
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That’s what Mehdi said, which is a diplomatic way of looking at it, if nothing else.
The massively negative reactions so far haven’t surprised Mehdi, as he said that the response has been “kind of as we expected.”
In an in-depth interview with Ars Technica, Mehdi talked about how this temporary confusion and discomfort will be worth it for gamers and consumers once they adjust to a world without discs.
“We’re trying to do something pretty big in terms of moving the industry forward for console gaming into the digital world. We believe the digital world is the future, and we believe digital is better.”
Mehdi brought up home movie watching as a comparison, where trips to video shops have been replaced with Netflix streaming on every TV-connected device. On Xbox One, the concept of having all games exist as cloud-connected downloads allows for new features, like the ability to access your games library at a friend’s house.
The digital “benefits” will be available at launch, but Mehdi hinted that the DRM transition might unlock more game access and distribution methods in the future. “In the future, you can imagine the capability to have different licensing models, different ways that people have to access games. This all gets unlocked because of digital.”
Mehdi didn’t go into more detail, but when the interviewer suggested things like “all-you-can-play” Netflix for games, or purely digital game rentals, he wasn’t shot down. Mehdi simply said, “Sure. It could be a variety of ways.”
Mehdi also claimed that the switch to a world of strictly downloadable and online-connected games would enable “a diversity of business models” for publishers to benefit from and take advantage of.
“As you go into a digital world, what’s happening is publishers are choosing to have different business models, and consumers are saying ‘Hey, if I can’t resell the title, provide me a different way to get value to get into your game.’ And we think the market will be efficient in finding good models that work for consumers.”
Mehdi also said that Microsoft wasn’t “giving in” to publisher demands with its new game licensing terms and restrictions. According to him, the company was trying to balance the needs of its four main “constituents,” which includes the consumer, who Mehdi said comes “first and foremost”, as well as game publishers, retailers, and Microsoft itself.
“Within that, we’ve tried to optimize, and I think we’ve found a great balance across all of those dimensions,” Mehdi said. “But there are tradeoffs. We do want to support everyone in that system, beginning with the consumer. But we want publishers to get paid for the great IP they work on. We want retailers to be able to drive and sell our products and make a profit. So we are trying to balance across all those.”
Mehdi pointed out that digital-only marketplaces like the iOS App Store have thrived despite having no physical media. Implementing a similar disc-free system on the Xbox One “may not [have been] the best thing for consumers, and it may not [have been] the thing they [would have] wanted,” Mehdi said, which is part of the reason Microsoft opted to keep discs as an option. However, he did concede that without discs, the licensing norms for the system “would be easier to understand.”
Mehdi spoke of the Xbox One’s sharing and transfering of games as a step up from other digital marketplaces, despite many seeing it as a step down or in the wrong direction from disc-based distribution systems. On the Xbox One, Mehdi said Microsoft has “tried to… bridge the two in a way that no one has done—to give you the power of digital and then give you all this power in physical. … We know we’re providing a lot more value to consumers, but in that comes a lot of need to clarify ‘how come disc, how come digital, how’s that work?'”
Currently, the internet is hateful about the way Xbox One removes the right to game ownership, as well as its use of online check-ins, and Mehdi said it was “hard to say” what the reaction from less attentive mainstream consumers would be. “I think it’s fair to say there’s a segment of consumers at this show in particular who really pay attention, who are very passionate about all aspects of gaming, and that we listen to closely. In a broader set of community, people don’t pay attention to a lot of the details. We’ve seen it in the research, we’ve seen it in a lot of the data points.”
Mehdi pointed to the success of the initial pre-orders for the Xbox One, which began once Microsoft ended its press conference on Monday. “Amazon basically says they are on path to sell out… Amazon is saying it’s one of their best-selling consumer products. We’re seeing the same thing from other retailers.”
In fairness, PlayStation 4 pre-orders were also a quick sell-out on Amazon after Sony’s press conference on Monday. Still, Mehdi said “it’s very clear there are a wide variety of other consumers that love to game that are excited about what we have to offer with Xbox One,” Mehdi said.
Mehdi also defended the fact that the Xbox One will sell for $100 more than the PlayStation 4, suggesting that the money spent will be worthwhile to consumers looking for the “best value” in their next console. In addition to exclusive titles and games, Mehdi said players would see value in the Xbox One being “backed by 300,000 servers backed by Microsoft that enable incredible game experiences.”
Mehdi also said that the included Kinect provides for better gameplay and “ease of use for the entire system.” Furthermore, features like live TV support and exclusive NFL and Skype partnerships will help show consumers the Xbox One’s “tremendous value.”
“We want to have our offering be differentiated relative to all others,” he said. “It has value that is in so many areas that is not in competing systems… That is a thing that each consumer will choose… and ultimately consumers will decide which is better. It’s a big market.”