Public attitudes to intellectual property: insights from the Xbox One backlash

Intellectual property (IP) law, like any other area of law, depends entirely on public attitudes for its effectiveness.1  However, IP law is particularly vulnerable to public discontent in a way that other areas of law are not.  For example, with the proliferation of home computing and rapid advances in technology, private citizens can easily obtain infringing copies of copyrighted content in relative privacy and safety.  Further, as is evident in so many cases of infringement,2 many people have little respect for IP rights.  Recent events surrounding Microsoft’s upcoming Xbox One provide an illustration of the significance of public attitudes to IP.

The “Xbone” backlash

For the uninitiated, the Xbox One is a video game console which will be available in November 2013.  It is the latest device in a line of home entertainment systems that is expected to be enjoyed by thousands of people around the world.  The device was officially announced to the public in May 2013 and received a very mixed response; a considerable number of people were highly critical of both the new console and of Microsoft.3  The critical public sentiment was felt through the words of one commentator who described the Xbox One as “anti-consumerist”, saying that “Microsoft is trying to change the definition of [video game] ownership on the Xbox One and it’s failing miserably”.4  The critique of the console was directed squarely at issues of  IP law, and Microsoft’s approach to those issues.

The public was highly critical of two features.  Firstly, the device required internet connectivity.  Users would need to “check-in” at least once every 24 hours and if they failed to do so, they would not be able to play their games.  This was a departure from previous video game consoles, which relied on a model where once a person had purchased a video game (once, in the form of a cartridge and later, in the form of a disc), they could play the game at any time, unrestricted.  Secondly, Microsoft flagged restrictions on sharing, selling and purchasing games,5 undercutting what is currently a large market for second-hand games.

Microsoft proposed the first feature as one that made the device more user friendly, removing the need to spend time “updating” games.6  Many consumers saw it as more of an anti-piracy measure and one that would allow Microsoft to determine the shelf-life of a gamer’s licence to play a particular game.  If games require Microsoft’s servers to play, and if Microsoft withdraws that support, users will no longer be able to enjoy their games.  The second feature was an incident of the new model of “connected” gaming, but was seen as a means of curbing second-hand sales and encouraging more consumers to purchase a full-priced, “fresh copy”.

These features are not new to the world of games.  For example, readers may be aware of the many free games available on the iPhone through the iTunes App Store, which give users the option to purchase in-game extras.  The Xbox One was to take console gaming in that direction by treating the user’s experience as a service, in the form of a right to a licence, rather than as a good, analogous to a board game.  Microsoft’s move was entirely justifiable, but not well received.

Microsoft’s change of position: an insight for owners of IP

In June, Microsoft did a proverbial backflip and removed the controversial features of the Xbox One.  Don Mattrick, Microsoft’s President of Interactive Entertainment Business, announced that an internet connection would not be required to play games offline and users would be able to trade-in, lend, resell, gift, and rent disc based games.  The public criticism obviously resonated with the company.7

The Xbox One as originally intended was a novel approach to the protection of IP rights and to the commercialisation of ideas.  Its features were well-supported in principles of IP law.  Yet the public was overwhelmingly hostile towards those features.  Video gamers see their games like other pieces of tangible, personal property, even if the law does not reflect that view.  Further, many video gamers saw Microsoft’s measures to protect its IP as greedy; they responded with a noisy campaign and a flagged boycott.

The takeaway is that there is still a considerable disconnect between well-established principles of IP law and the attitudes towards those principles in the general public.  Although this case concerned games, it is directly applicable to other forms of digital entertainment and to copyrighted content in general.  Broader still, it illustrates a continuing problem for proprietors of IP.  Your IP rights will be respected only if people believe they should be respected.  It seems that in some cases, when it comes to exploiting the value of your ideas, effective marketing may be just as important as the legal enforcement of your IP rights.

1 Paraphrasing a school of thought known as legal positivism; see eg: HLA Hart, The Concept of Law (Clarendon Law Series, 3rd ed, 2012).

2 A recent example before the High Court concerned the counterfeiting of gaming machines: Aristocrat Technologies Australia Pty Ltd v Global Gaming Supplies Pty Ltd [2013] HCA 21.

3 As demonstrated by Microsoft’s response: Don Mattrick, “Your Feedback Matters – Update on Xbox One” (Media Release, 20 June 2013) <>.

4 Tom McShea, editor of GameSpot; see: Tom McShea, “Sony’s Triumphant Night”, GameSpot AU (10 June 2013) <>.

5 Many features were announced at “E3” 2013, also known as the Electronic Entertainment Expo.  See eg Derrik Lang, “Xbox One available in November for $599”, Sydney Morning Herald (online), 11 June 2013 <>.

6 See account of IGN: IGN, "Always Online Connection”, (20 June 2013) <>.

7 Don Mattrick, “Your Feedback Matters – Update on X-Box One” (Media Release, 20 June 2013) <>.

Disclaimer – the information contained in this publication does not constitute legal advice and should not be relied upon as such. You should seek legal advice in relation to any particular matter you may have before relying or acting on this information. The Lavan team are here to assist.