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MS Seeks Entrance Fee to XBox Accessory Market
pwnage writes "According to CNET, Microsoft's newest licensing model for the next-generation XBox will effectively lock out 3rd-party accessory manufacturers who don't enroll in Microsoft's licensing and royalty program. The new console will employ hardware security mechanisms to ensure that only products created by developers willing to fork over cash to Microsoft can connect to and work with the console. Is Microsoft shooting itself in the foot by making traditional 'approved product' licensing mandatory for 3rd-party developers? Or will companies line up by the dozens to tithe to King Bill? Finally, will Sony follow a similar strategy to eke additional revenues out of its PlayStation 3?"
So, for those of you old enough to remember, Nintendo charged exhorbitant licensing fees for anyone who wanted to make NES games. The way that they ensured that companies paid this fee was to build a lockout chip called 10NES into NES cartridges which only Nintendo could make. A few companies, most notably Tengen, reverse-engineered the chip, however, and made some unapproved games. Tengen actually cheated and used Nintendo documents to reverse-engineer the chips and ended up getting sued, but if this licensing fee is too high then what is going to stop accessory makers from reverse-engineering the chips and being done with it?
The NES "lockout chip"
Patent 1
Patent 2
Disabling the chip
There is another kind of evil which we must fear most, and that is the indifference of good men. -- Boondock Saints
After paying $50+ for the Everquest2 game, then $15 a month for the privelege of actually using the game, then finding out that Sony wanted a piece of the action on items sold in Station Exchange auctions...I got an idea of how Sony treats its customers. I'm sure they are elated that MS took this step, now they can treat 3rd party vendors the same way.
Am I bitter? Oh, a tad.
I've since moved to Guildwars. It's possibly the best RPG game I've ever played.
I'm sorry, but your opinion seems to be wrong.
"Seems perfectly legal"
it's not. Auto makers tried to this very thing, so did printer manufactures, and a hos of other companies.
All of which failed in court. So as soon as someone make an item that gets around the security(and they will) it won't matter any more.
Or someone will sue as anti competitive, and they will win.
The Kruger Dunning explains most post on
Never took an econ course, did you? In a competitive market, price is a function of two things: supply and demand. It is in no way a function of cost. (In a highly competitive market, price approaches actual cost.) Cost is merely a factor in determining whether the market will be entered at all. What Microsoft is doing is eating into the profits of accessory manufacturers, but the manufacturers can't pass that along unless they all collude to do so, because whichever one doesn't will capture most of the market.
If you don't know where you are going, you will wind up somewhere else.
yes, they did!