How much will game theft harm the Xbox 360?

Gaming is growing massively and will soon be bigger than television and film combined. This is because gaming has the technical advantages of interactivity, connectivity and non linearity. No other entertainment medium can compete with these. These 3 technical advantages have the added benefit of making anti piracy measures relatively easy to implement. In fact a game console’s main role in life is to act as an anti piracy dongle.

This anti piracy advantage is a great bonus for the games industry. The music and film industries are suffering horribly from thieves precisely because their products are impossible to protect. However the game industry is extremely complacent precisely because of these technical advantages. So everybody does far less than they should and could to prevent piracy. And with our guard down it is very easy to have a disaster. This happened with home computer gaming and PS1 gaming. It is happening right now with PC, PSP and DS gaming.

And now the Microsoft Xbox 360 could be heading for this same disaster. Basically it has become very easy and very common to chip the console to bypass the copy protection. And most customers would rather steal games than help to pay for their development. Microsoft’s only recourse is to close the Xbox Live accounts when they detect a chipped deck playing a pirated game. This is circumvented to a large degree by having two decks. One chipped for playing stolen games and one not chipped for using Live. An extra deck only costs as much as three games.

But how bothered are Microsoft? Free, stolen games will make the Xbox even more desirable over its competitors and so will give Microsoft a great USP in the console war. Also Microsoft are almost certainly making a profit on every console sold, even at the new low price points. It is such an elegant hardware design. And then they have all that regular monthly income from Live.

The real losers are the publishers. And via them the developers. If a game platform is pirated excessively then publishers can vote with their feet. There are plenty of other platforms they can spend their time and money working on. This is what they have done with the PC and PSP. And the stupid game thieves end up with no games being made for them to steal.

So the danger for Microsoft is that publishers abandon their platform. It no longer works as an anti piracy dongle. This was part of the downfall of the Dreamcast. In fact the bigger problem is publishers deserting the whole console business model. There are areas of gaming that are growing much faster and which are pirate proof, offering far better prospects. In fact a lot of the console game business looks like people doing it just because they are in the habit of doing it. You can all name publishers doing this.

One thing is for sure, Microsoft must really get their whole anti piracy strategy a lot better for the upcoming Xbox 720. It would be sad if the billions they have invested in console gaming became a dead end.


  1. Piracy is a problem, but I think you overestimate their effects.

    The original xbox could be modded to not only run copied games, but new operating systems and allow entire games and movie dvds to be copied to the hard drive.

    Despite that, I am unaware of Microsoft “losing” any cross-platforming titles from 3rd party developers. On top of that, many of the great original xbox games didn’t even hit the market until later in the console’s life.

    There will always be a small minority of people breaking the rules. Luckily for console makers, installing a mod-chip is a long ways away technologically from downloading Kazaa and clicking your way to free music.

    Until piracy is made easy, the videogame industry is not going to take a significant hit to alter anyone’s agenda. The scale of the problem is more like the kids who sneak into the movie theater. There will always be some who get caught and some who don’t, but there will never be so many people doing it that Disney decides not to make Pirates of The Caribbean.

  2. the 360’s attach rate suggests otherwise

    the PS2’s (easiest chippable console ever!) install base suggests otherwise

    sorry but whats the point in 2 rigs for pirate and original games? the original games worth playing on xbox live are most engaging just post release when the servers are full etc so do you suggest they buy original discs, pay for xbox live, but play games they otherwise would never own thus never paid for? – point is they buy the ‘worthy’ games and steal the ‘unworthy’ games? – well that’s no loss to MS cos firstly they own 2 rigs, and they pay for XBL and they still buy games to play on XBL.

    Everyones a winner

  3. One thing that MS do have in their defence bruce is the LIVE experience itself. Know a few people who have their 360’s “flashed” or chipped and They very rarely go online with their pirate games. I could never chip my machine. Going online with the 360 is now an intrinsic part of my gaming experience, and i couldnt take the rest and face the fact that option could be removed from me and i would have to buy another machine. Just my thoughts. I couldnt imagine pirating Fallout3 for instance, and potentially deny myself all the juicy DLC that is coming or download Call of Duty and not be able to go online with it . . . Espcially seeing as i pay for that online experience . . . .

  4. This is a very stupid argument only less than 5% of all xbox 360 owners have “Mod Chips” so Microsoft only looses very little customers. Don’t waste your time writting stupid articles if you haven’t looked at the facts.

  5. Just look at how well PC gaming is doing with reported 90% piracy ratings on some games

  6. And yet the Xbox 360 has the largest attach rate for games, which suggests that your assertion that “most customers would rather steal games than help to pay for their development” may be a little off base. I don’t know anyone personally or any of my customers that have a modded 360, which definitely goes against your “most”, as I am drawing from a pretty large pool.

    Also, a large part of the Dreamcast’s failure had to do with a lack of sports games from EA, who control that market. That, and Sega had built themselves quite a reputation for ditching their platforms with little notice. It would be hard for a third party developer to put time and resources into a project for a system that may not be around when the game is ready for launch.

  7. They dont just buy the “worthy” games, and steal the unworthy. They buy the games with multiplayer and steal all the single player games. For instance I would imagine they would steal games like Bioshock, Fallout 3, Dead Space. And buy games like Left 4 Dead, Gears of War 2.

  8. like alway piracy=scapegoat MAKE BETTER GAMES (7 hours of single in COD 4? Wahta aaa fugly!!!)

  9. this article is irrelevant. PC piracy has been an issue since PC games first started being made and PC games are still being made, but developers and publishers are all smartening up. Pretty soon you will no longer have to purchase games via a store, everything is soon gonna be done digitally and the best part about digital distribution is that titles cannot be pirated. Considering PCs have taken this route, it is only a matter of time before MS does the same… example being Steam which sells Valve products as well as 3rd Party titles.

  10. There will always be pirates. Like there will always be prostitutes,traffic jams,a qq in a bank ect ect ect….

    Game developers do feel the sales but thats why they have dlc to still make a profit of games and i find that ingenuis. If it original or pirated they still make $$$ of the downlaodable content available on xbox live so they still go home happy but as happy as they would of been if the game wasnt pirated to start with. IT wont effect the 360 in the slightest

  11. Why can’t developers just allow us to download a game via Marketplace, if we want to pay/buy a game, all we have to do is buy the serial code!

    Can’t remember, but I read some article that some company are doing it for PC games, people will buy the serial number instead and they will download thee full game online.

    Allow us to buy serial codes for a game at a shop or online, once purchased we can then use it on the specific game we downloaded.

    Only downfall for this is heavy use of bandwidth.

  12. Interesting article though it’s not called stealing. You keep making comments about being a thief and stealing games but that’s just not true. The game is never stolen. If you call it stealing then a friend lending out a game to another friend is stealing since that’s one less sale for the publisher.
    In-fact you should also go after the shops that rent out games.
    I don’t own a chipped 360 but I don’t feel sorry for anyone, especially those who charge ridiculous amounts for DLC and halt the online section of that game for those who didn’t pay(more!) to get the DLC.

  13. Yea, but xbox360 sells alot more games than any plataform, wii sell a lot of consoles but not games thas a really problem because of piracy,DS sell a lot of hanhelds but no games because of R4 types of cards, dont be a dumb ass PS3 is loosing, dont sell to many consoles and games too. You PS3 FANBOY.

  14. I have legally purchased over 40 games for the Xbox360. Sometimes I can’t believe myself. Help me with my addiction, Santa.

  15. In Asia, almost all PS2 games are pirated to play on a modded PS2. It didnt harm the developers, it didnt harm Sony (in fact, they sold more consoles because of that). The developers know this fact, that there will be people who pay for the originals and people who get the pirated and I think their sum favours the paying part. Just like the PC games. With multiplatforms games being developed nowadays, and franchise licences(figures, books, merchandises), I guess the devs are actually fatter not thinner. My view anyway…

  16. “Just look at how well PC gaming is doing with reported 90% piracy ratings on some games”

    I’m assuming that was an irony statement there???

    PC gaming has been in a tremendous decline for the past 5 – 10 years…….if you try to compare PC gaming to console gaming nowadays you’d get transported to an insane asylum.

    However if the level of piracy on the DS is really that high…….considering the DS’s sales figures i don’t think the 360 has too much to worry about.

    NES owns da PC!!!

  17. “if you try to compare PC gaming to console gaming nowadays you’d get transported to an insane asylum.”

    Right. Because the PC is still the platform with the single largest user base on the planet. And because the most succesfull game this year will be a PC exclusive (or, more specificly, an addon). Oh, and never mind the gigantic homebrew/causual-gaming scene.

    PC *gaming* is in better shape than ever. Now, the PC *games industry*…. that’s another story.

  18. come on, what will you say if a God of War cd costs as much a person lives, eats and supports himself for a whole month in India and other Asian countries.
    they need to cut down the prices to prevent this.

  19. Microsoft need to bring a budgetery Xbox 360 for Asian countries bcauz man spends his expenditure of 4 months on it and games are too costly in India so Microsoft should think on it

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