Next-Gen Xbox Protection Rumor Raises The Question Of Always-On DRM

According to an Edge report, the rumored next Xbox will have a game registration system that will prevent the 50GB Blu-ray titles from being resold on the secondary market. The Edge writes:

Sources with first-hand experience of Microsoft’s next generation console have told us that although the next Xbox will be absolutely committed to online functionality, games will still be made available to purchase in physical form. Next Xbox games will be manufactured on 50GB-capacity Blu-ray discs, Microsoft having conceded defeat to Sony following its ill-fated backing of the HD-DVD format. It is believed that games purchased on disc will ship with activation codes, and will have no value beyond the initial user.

I am at once skeptical that this is true – it sounds wildly far-fetched to me, even given the horrible decisions made by CE makers in the past – but it also points to a focus on a networked console with loads of storage space more akin to a Steam box than an optical disk player.

My problem with this rumor is that it makes no economic sense for Microsoft. It immediately alienates buyers, game resellers, and even game rental outfits. While there are instances where you must license a game in order to play online, always-on DRM that negates the value of optical media sounds ridiculous and has been proven again and again to be unworkable.

This story could have come from a grumpy developer who used a feature made available by Microsoft for next-gen console developers but it sounds less like a possibility than an alternative, terrible future.

And yet… if you had told the 2001 version of myself that in a little over a decade I’d download all of my music and never buy a paper book again I’d have laughed you out of the Internet cafe. It makes perfect sense for Microsoft to focus its efforts on downloadable gaming. Optical media is an obvious attack vector for console pirates and although the DRM will be hacked in the end, this gives Microsoft a head start against piracy for newer games. I can definitely see a day when I will no longer want or need a stack of game disc cases near my television set – but I’m loath to believe Microsoft (or at least its gaming division) would do something so ham-handed.

We are entering a fascinating stage in gaming. With consoles like Ouya and the aforementioned Steam Box, manufacturers are slowly training consumers to accept the possibility of a console without physical media. While we, in our mental models, find the concept to be abhorrent, I would say that the future will bring an Xbox without a disk slot at all, thereby rendering the thought of used game sales moot. This, I’d wager, keeps GameStop executives up all night in a cold sweat and, in turn, upsets the kid in us who still wants to borrow his buddy’s copy of Demon’s Souls.