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Microsoft bans 1 million Xbox Live users, boosts economy
By Ryan Burns
Last week, roughly 1 million Xbox Live users started up their Xbox 360s and discovered that their systems had been blacklisted due to terms of use violations. Specifically, users have been banned for modding their 360s in order to circumvent DRM protection, thus allowing the downloading and playing of illegally downloaded games.
"All consumers should know that piracy is illegal and that modifying their Xbox 360 console to play pirated discs violates the Xbox Live terms of use, will void their warranty, and result in a ban from Xbox Live," Microsoft said in a statement to Information Week.
This ban hammer was most likely swung in response to the fact that hundreds of illegal copies of the highly anticipated Call of Duty: Modern Warfare 2 were distributed before the game went on sale. This may be because Microsoft learned from the similar Spore torrent debacle last year, and decided to take action this time around.
Banned systems are unable to access Xbox Live, but still function normally otherwise. They are perfectly usable, as long as the user is happy playing offline. Apparently this is not often the case, as gamespot.com reported that several modded and banned Xbox 360 consoles have been posted onto the San Francisco Bay Area edition of Craigslist.
In fact, so many modded Xboxes have appeared that the price on these consoles has dropped considerably. At first, sellers were asking around $150, but now most banned 360s are going for between 75 and $100. The most basic 360 Microsoft costs $200 new.
"If you purchase a modified console second-hand, the warranty is not transferable and the purchaser assumes the risk for any previous modifications," Microsoft said in a statement. "If you purchase a console that has been previously banned, you will not be able to connect to [Xbox] Live."
It is important to note that Microsoft has banned the modded systems, not the users' accounts. According to CNET News, one gamer with a banned system said that after buying a new 360, his account was still active and he still had all his achievements. All he was missing were his saved games, which are rooted to his old system's hard drive.
It was not that simple, however. The gamer, who said his name was Kevin, first tried to buy a pre-owned 360, but discovered that that system had also been banned. Kevin will most likely not be alone in selling his system to buy a replacement, and all those sales could flood the pre-owned market with banned systems.
The only way a consumer could be sure that he or she is buying a fully functional machine would be to buy a brand-new box. If each Xbox Live user that was banned bought a basic new 360, Microsoft would see a $200 million profit for the holiday season this year. Way to stimulate the economy, Microsoft.
"The health of the video game business depends on customers paying for the genuine products and services they receive from manufacturers, retailers, and the third parties that support them," Microsoft said.
Originally Published: Issue 824 - November 18, 2009
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