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Xbox One's Offline Pass Is an Ill-Conceived Tax

Tom Mc Shea warns that Microsoft might be killing itself rather than the used-games market.

1645 Comments
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Microsoft spent an hour explaining why the Xbox One should be the centerpiece of your living room entertainment experience. However, in just one sentence, it may have destroyed its upcoming console's appeal as a gaming platform. Used games, an aspect of this industry that has thrived for decades, may come with an extra cost in the future. Apparently, you may no longer buy a dust-coated game or lend your favorite offering to a friend without throwing money Microsoft's way. The Xbox One is attempting to squash the pre-owned market, and if such a detrimental tax is implemented, it will have disastrous results for the sustained health of Microsoft's third console.

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In a statement to Wired, Microsoft stated that "on the new Xbox, all game discs are installed to the HDD to play." Once the game is tied to an account, if another person wants to play it on their system, they will have to pay an undisclosed fee. Microsoft did say it will reveal its used-games plan in the future, but examining the facts as we now know them, this policy seems inspired by the online passes that some current generation games require for connected play. Microsoft is essentially implementing an offline pass. And how could its unannounced plan alleviate this excessive burden? Maybe Microsoft will let you play off the disc for a limited time before you're forced to shell out money, or maybe every game will be required to have a demo. Either way, the used-game, rental, and lending markets will dry up.

The Xbox One is an entertainment curiosity rather than the next video game revolution.

This draconian policy has been slowly building for the last decade. As digital games have become more prevalent, so too have the measures to limit their post-retail distribution. Xbox Live Arcade and PlayStation Network games are tied to the accounts that purchased them, and Steam users have dealt with a similar barrier for years. And the mobile market, which has been heralded as the future by so many, is in the same situation. The idea of a game being playable only by the person who first spent money on it has existed long enough that such a move on Microsoft's part should be expected. However, this is the first time any company has tried to destroy the resell market for disc-based games, and it's that distinction that's so important.

People have long embraced the used market in all forms of media. Whether we're letting a friend read our copy of The Catcher in the Rye, browsing the used-CD rack for vintage Pearl Jam, or picking up a cheap copy of Jurassic Park III to see raptors talk, we've become accustomed to borrowing or cheaply buying once-loved entertainment. And this has been a core aspect of gaming for longer than most gamers have been alive. We like the idea that once we buy a physical product, we own it. So it's baffling that Microsoft would ignore years of consumer tenancies with this extortionist tax. As long as games are on a disc, people will expect to be able to lend them to friends without having to pay Microsoft for this privilege.

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Video games can be expensive, much more so than other media, so shelling out $60 for a dozen hours of entertainment is a tough pill to swallow. We've found ways of enjoying our favorite pastime without going broke. Borrowing some games while purchasing others has been a practice of many people for years, and there's no reason such a philosophy couldn't serve both consumers and publishers going forward. Microsoft is burning bridges if it decides to enact an offline pass. It will create an infrastructure that is even more punishing for new intellectual properties. People will be less likely to try an untested franchise if they have to pay full price for it, so Microsoft is just pushing the industry further into the innovation-be-damned mentality that has been a plague the last few years.

Ultimately, consumers determine the success or failure of any company.The importance of catering to people with money to spend cannot be overstated, and Microsoft is hurting that relationship, possibly irreparably so. There is no way to spin this extra fee so that it's more palatable for the buying public. This is unabashed greed, pure and simple, and the defining aspect of the Xbox One. Microsoft wants to be everything to everyone, your one-stop shop for television, music, movies, Internet access, and video games. However, such integration isn't worth emptying your wallet for. It's not worth giving up your rights as a consumer. A disc or cartridge is ours to do with what we choose, and until Microsoft acknowledges this fact, the Xbox One is an entertainment curiosity rather than the next video game revolution.

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cantonphantom

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What does this mean for Gamefly, RedBox, etc.?

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ElFlechero

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Microsoft already gets money from used games--at least games with multiplayer. If someone buys a used game, they're going to spend time playing it on xbox live, time that they have to pay Microsoft for. That won't stop Microsoft from double-dipping of course.

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cousinmerl

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Edited By cousinmerl

@ElFlechero fair point.. and people still buy DLC packs on second hand copies.

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tripwire73

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one thing this will very much encourage is "Freemium" games - games that cost nothing (so are free to download and avoid the used game fee) but that require purchases to unlock critical features.

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Metallic_Blade

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Keep what you are doing Microsoft because it's sure to attract alot of attention to the console hackers. You thought that the first two consoles were bad? Well, they're in for a rude awakening.

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neotheinstein

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Edited By neotheinstein

Microsoft will make a fool of all the rants at the e3.

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TigusVidiks

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@neotheinstein 15 exclusives, that no one has heard about, that may or may not take off, are not going to change the consumers views on their commercial strategies.

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neotheinstein

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the e3 will wake you up from your little big planet dreams.

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neotheinstein

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Edited By neotheinstein

how the heck in this world can you run a campaign against the xbox one and Microsoft when e3 is yet to come with 15 exclusive games, illumiroom and Kinect 2.0. how the heck in this world it is a problem if your console can do a lot more than games and replace your pc and tv for entertainment. everything except multi-tasking performance, exclusive games, illumiroom and Kinect 2.0 would be somewhat same for both xbox one and ps4 and you know who the real winner would be if you stop ranting and open your mind.

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Senior_Rosa

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@neotheinstein Dude, if i buy a console is for gaming. Not to watch tv. And think of Kinect as the new way of spying or controlling who's playing what, sending periodic activity info to MS servers, screens included imo.

Almost all games i own in my xbox360 were used games, because i won't pay 60+ for a game, no matter how good it is. One thing is clear now: i won't buy this console unless it gets hacked. No way i am letting MS go away with this policies.

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cantonphantom

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Edited By cantonphantom

@neotheinstein actually, my PC has replaced my tv, xbox, and ps3 for entertainment...

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cousinmerl

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@cantonphantom @neotheinstein but is it a Microsoft made PC?

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tripwire73

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@neotheinstein if you're expecting illumiroom at E3, get ready to be disappointed

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punksterdaddy

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@tripwire73 @neotheinstein

This guy is trolling comments by posting and reposting the same things?

Have a look at Kevin VanOrd's latest article about the XboxOne. The exact same posts there too?

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Overlord93

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I'll ask this again, how else can they do it? The system is based around having an instant game library that doesn't require a disk, the pass system is a result of that, not as a result of them specifically setting out to create a DRM scheme.

The system they are setting up is rumoured to be some sort of trading system, although if they don't create something like this it could be a big issue.

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minkbikini

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the whole "Kinect is always listening, you don't need an on/off switch" is very creepy.

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vajjala1986

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I think this article got it little wrong. There are 2 scenarios here.

1) If you buy a game, and your friend wants to play using same DVD. He has to pay the developer - same price of game (or at lower cost). It is the developer that is benefiting. It is not a tax. your friend is effectively buying the game.

2) If you want to sell a pre-owned game. You sell the game at whatever price. Offline Pass transfers from your live account to the buyer's live account. You get the money. May be there will be a small processing fee for pass transfer like bank transfer.

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cantonphantom

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Edited By cantonphantom

@vajjala1986 regardless of who the money goes to, the article hit it right on the nose.

1. People have been buying, selling, and trading media in various forms for decades. And, for decades it has never been a major issue. Once you buy a game, movie, or CD, it is yours. And, as the owner of that product, you should have the right to do with it what you want. If you have played a game, beat it, and moved on to another one, why is it okay for Microsoft to charge your friend/brother/sister/etc. any amount of money to play that game?

2. Perhaps you can sell the game to your friend, but that is your decision as the owner of that game. It is not for Microsoft to decide how much you sell it for, or how much your friend pays. Nor would it be fair for Microsoft to charge any sort of fee for the transaction.

If Microsoft sticks to this strategy, Sony is going to win in the gaming dept. Making the Xbox One nothing more than a powerful, slightly more gimmicky Apple TV.

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TigusVidiks

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@vajjala1986 what makes you think it goes for the developer? Sony said they would give Devs the possibility to do so at their own risk and choice. Microsoft said they are going to charge a fee for every used game. More likely, for themselves, giving a small percentage to the devs that require it.

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Mausolus

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There's something really ironic about Sony coming across as the 'good guys' in all this.

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RAGEofSTUNTS

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How am I suppose to sucker people for my used games when they always have to pay a tax now?

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joeboosauce

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Edited By joeboosauce

Thanks Tom for being a critical voice of reason! Extortionist tax indeed!


It's high time that consumers stand up against the slow chipping away of our rights:

1. OWNING what we buy. Digital has become a Trojan horse.

2. Always on-connection (or as MS says "it's not but you need to check in every day).

3. Mandatory spycam... I mean Kinect 2.0. You can say "xbox on" and it turns on? Cool but, its ALWAYS listening?!?!? This is f-d up. Always on camera? So, watch what you do with the girlfriend/wife while you are watching TV, movies, etc


Serious consumer and citizen issues. Privacy and ownership are being thrown out the door.

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Xx_Kares_xX

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@joeboosauce I'm not defending the Xboxone in any capacity.. and I find the kinect always on thing really f******** creepy, but if you REALLY want and Xboxone and don't like the kinect problem.. you could just... unplug the console when you aren't using it... it will also help your electricity bill out a little ^^

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xiaoyangguang

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Tom forgets to mention the one important point, what if you change boxes like socks but still want to keep your games, and what if you forget your account details.. then all those purchases are worthless.. If this is the direction Microsoft is going, then I will for sure not buy their "Xbox One". They should call it "Xbox No Thanks" instead. I've spent a lot on money on them but not this time. As a collector and gamer, this business model is just ringing "Theft" in my ears...

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cantonphantom

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Edited By cantonphantom

@xiaoyangguang Very good point... This reminds me of a similar issue I had with Steam, where they mysteriously blocked my account, and had no valid explanation for it. They told me to just make a new account. When I asked about transferring my games, they said it would be possible but only if I had the original activation keys for the games... games that I had purchased years prior to this fiasco. Needless to say, I don't have the Keys and those games are lost forever... Some of which, I had to purchase again.

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Senior_Rosa

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@cantonphantom @xiaoyangguang Dude, that Steam story is awful. You had to pay again?? I woudn't even bother. I would just pay a flight to their HQ and burn it down till the ashes.

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Edited By snowSHO

After watching the conference, the one thing I got excited about was the next article by Tom MchShea. Thank you for being critical of everything. We need it now more than ever.

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Errorcutive

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Jezz what ever, as long as we have pirate on our back the game is exchange able, LONG LIVE THE PIRATE

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Gamer_4_Fun

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Exchanging games among friends is a part of the gaming culture. I despise Microsoft and curse them for trying to ruin it!

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wizemanschaos

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When you think about it I rather my money goes to developers rather than the price gouging bastards at gamestop. While I feel that having friends borrowing games and having to pay to play sucks I haven't really let a friends borrow a game since highschool. I think it puts gamestop in a position to lower the prices of used games or maybe already provide the used game code at purchase. This seems like a bad idea but considering the actual studios will be making more money I am sure we will see the VG industry blossom as long as we support it.

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Xx_Kares_xX

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Edited By Xx_Kares_xX

@wizemanschaos You're kidding right? x.x It's not about helping the game industry, it's about lining the publisher's pockets. The developers won't see a CENT of the used game fees, it will all go to the greedy ass publishers. The industry has done just fine for years before now without putting these drastic (and stupid) measures in place... it's only about greed, not about support or need. Not only that but the industry is in the toilet either way... they don't need more money to be successful, they need to manage the money they have BETTER. It's hilarious to me that they are trying to fix the industry by making consoles that are just going to cost even more money to develop for.

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wizemanschaos

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Edited By wizemanschaos

@Xx_Kares_xX Id rather give it to the publishers rather than gamestop. Just saying.

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wizemanschaos

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@decepticondevil @wizemanschaos @Xx_Kares_xX I am a bit curious where people are getting this information from. I haven't really seen anywhere that mentions the amount of the fee but this is not the first time I have heard it. If anyone can supply me with the source of this that would be great, but this honestly sounds like it is a fabrication by people who are just sour about microsoft.

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wizemanschaos

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@decepticondevil @wizemanschaos @Xx_Kares_xX I doubt the fee will be the price of the full game. this is not the first time I have heard this though, but I would definitely be interested in seeing the source.

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Xx_Kares_xX

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Edited By Xx_Kares_xX

@minkbikini @wizemanschaos @Xx_Kares_xX

EXACTLY Minibikini. the game and license have ALREADY BEEN PAID FOR. I don't hate gamestop at all... I love them because I'm a collecter and I know what I'm buying. If you think they are ripping you off when you trade your games in (which they ARE) then Don't trade your games in there. When the price between a new and used copy of a game is only $5 dollars than shell out for the new copy. It's pretty simple really. If you don't want to be ripped off, spend the time looking up prices and selling the gsames YOURSELF on amazon. And as I've said before, as much as publishers like to bitch about Gamestop, they actually heavily rely on gamestop for their sales. Gamestop is far more important and useful to game publisher than it is bad for them.

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minkbikini

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Edited By minkbikini

@wizemanschaos @Xx_Kares_xX but it's going to the M$ bottom line not the devs. (Besides, for a game to be used it was bought new at some point in its life.)

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decepticondevil

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@wizemanschaos @Xx_Kares_xX I hate Gamestop and their greed as much as anyone... hell they give you next to nothing for a used game and them sell it for $5 off the price of a new one. I never buy used, and I have only traded in one game this gen (MW3, incidentally).... but this is not the answer. Especially considering Microsoft has officially stated that the fee is not a couple bucks, but the full price of the game. Gamestop can't "lower the price" of the used games because the price of a "used" game is now the full retail price of it new. Buying used? Renting? Borrowing? All finished under this plan. Have more than one Xbox in your house (as we do in mine)? Pay for every console you want to play it on... unless you want your roommate to use your account, and I'm sure one account can't be logged in on two consoles at once.

I would have rather given my money to publishers... in fact I always have. But if they're going to go overboard with greed to this extent, they can kiss off.

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Sam3231

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What a fucken piece of shit before you know it they will be charging $5 a piece for game pauses and quarters to turn on the console

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amdreallyfast

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Edited By amdreallyfast

Maybe the decision to not announce the used games policy is Microsoft's way of poking the gamer audience and seeing what it does. Hopefully they see the backlash and ease back on the DRM. I think it is inevitable though. The capability is there, and it will be too convenient to ignore eventually. Besides, if gamers hate the idea of DRM at launch, they can start slow and get people used to it one irritation at a time. After all, that's how you cook a lobster in a way that it doesn't notice.

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decepticondevil

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@amdreallyfast Call me a conspiracy theorist, but we've heard rumors of this scenario for months, and I've always wondered if the rumors themselves were started by Microsoft in order to gauge reactions and see how people responded. If so, they apparently felt like the backlash wouldn't be strong enough to hurt sales too much... but the thing is, most reasonable people didn't think they would actually be stupid enough to really do it. If we did, this freakout would have come much stronger months ago.

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FarginIcehole

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@amdreallyfast Poke 'em back with a PS4 pre-order!

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Ravenlore_basic

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This will effect Gamespot and people who can not buy/sell their games in other ways.

Game spot sells their games for a few dollars less than New games I have seen PLENTY of used games for $14.00 -$17.00 while the new game was $20.00. Buy a recent game and the cost is used $45.00-55.00 used and compared to $60.00 new.

HOW do you think GAMESPOT makes BILLIONS!!!!!!! They buy low and sell high.

WE can still buy from Ebay or crags list, for the same price or less that Gamestop sells its games for, and make more money selling the games.

It really DEPENDS on what the price Microsoft will charge. Knowing them it would be a lot and affect the business, but even with the GREED of Microsoft, someone must know that they can't charge too much or it will backfire.

Sony will do the same though I know they will charge less than, or IF Microsoft just charges $5.00 - 10.00 Sony will match it. IF Microsoft charges more I am sure Sony would be happy to undercut Microsoft.

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decepticondevil

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Edited By decepticondevil

@Ravenlore_basic I'm not sure if I can post links here, but Microsoft Corporate Vice President Phil Harrison told Kotaku that the fee will be FULL RETAIL PRICE. So, buying a game used will actually be MORE EXPENSIVE than new... because you pay whatever you're going to pay someone for the disc, then the full $59.99 or whatever to "activate" it. Makes sense, right?

Of course, in the face of the backlash they're dealing with, they have now backpedaled and said this is just a "potential scenario". Hopefully they're realizing we won't put up with this.... or they figured "Hey, we'll tell them it's full retail, then when we tell them it's only half retail they'll think it's a bargain!!"

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SmooveE

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@decepticondevil Harrison indicated that it would be full retail price for a "new game", which presumably means that the price will decrease once that game is off a new release list or is no longer popular. the link is posted a few comments down by @angellc .

I miss the good ol' days when we owned things that we purchased, or at the very least were allowed to believe that we did.

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Gamer_4_Fun

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@Ravenlore_basic GameStop or GameSpot?

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Yulaw2000

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This is an excellent post. Thanks Tom.

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angellc

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Read and take heed!!

http://kotaku.com/you-will-be-able-to-trade-xbox-one-games-online-micros-509140825

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Yulaw2000

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@angellc

I like to trade/sell my games as I see fit and not pay the person I already purchased it from for the "privilege".





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vajjala1986

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@Yulaw2000 @angellc Tell that to the banks first who take processing fee for every transaction.

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Cowboy-Bebop

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Smartest man alive!

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