UPDATED: Publishers to receive cut of Xbox One pre-owned sales at retail

Ben Parfitt
UPDATED: Publishers to receive cut of Xbox One pre-owned sales at retail

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.

UPDATE 2: Microsoft's Major Nelson has at last offered a direct (although not direct to MCV, incidentally) reply to our story on his website. It reads:

“Over the past few days, we have been reading comments and message boards following the Xbox One announcement. There are a few questions regarding used games. I wanted to clarify and provide this official statement:

“The ability to trade in and resell games is important to gamers and to Xbox. Xbox One is designed to support the trade in and resale of games. Reports about our policies for trade in and resale are inaccurate and incomplete. We will disclose more information in the near future.”

Is this a dismissal of the rumours? That's up to interpretation. “The claims that Microsoft is changing the pre-owned games model at retail are false” or “users will not have to pay a fee to play pre-owned games on Xbox One” or “there will be no change to how retailers sell pre-owned Xbox games in the future” would have been a denial.

That the “reports are inaccurate and incomplete” is as frustratingly vague as every comment on the subject from Microsoft has been so far. The report could be “inaccurate” for an assortment of minor reasons, none of which affect its central claims.

And more to the point, if the claims are inaccurate then why not tell us when we shared them with you prior to publication?

Again we're left in the situation of craving nothing more than a concrete response to what is fundamentally a very simple question: Under what circumstances will users be charged for playing a game that has previously been registered on another user's account?

It sounds like we want the same thing, Major – some clarification. We eagerly await.

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Tags: Microsoft , Retail , pre-owned , Xbox One

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