Furor Over Sony Patent (LA Times)

**Lzen** · 07-10-2006, 06:14 PM

Technology that could prevent resale of games and other digital goods raises speculation, fears.
By Dawn C. Chmielewski, Times Staff Writer
July 10, 2006

Sony Corp. has patented technology that would prevent its PlayStation consoles from playing used, rented or borrowed video games — raising questions about whether the electronics and entertainment giant may attempt to redefine what it means to own something in the digital age.

Sony has said little about the technology, patented in Japan in 2000, or how it might be deployed. But speculation over Sony's plans has sparked a furor online as game fans and consumer advocates fret that the company may incorporate it into the upcoming PlayStation 3 console, due to hit stores this fall.

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They worry that it would wipe out the $1-billion-a-year market for used games and could even prevent someone from playing their games at a friend's house.

It is not unusual for technology companies to patent innovations and then never incorporate them into products.

Documents filed in April 2000 with the U.S. Patent Office describe a method of copy protection by which the game system would verify a disc as legitimate, register the disc to that particular game console, then wipe out verification data so the disc would be rendered unreadable in other PlayStations.

"Since only titles for which legitimate software has actually been purchased and which have been initially registered in the machine table can be used, resale (so-called used software purchase) after purchase by an end user becomes practically impossible," according to the patent documents.

Although Sony has been vague about its plans for the technology, "I actually think they're toying with this idea," said Michael Pachter, a game industry analyst for Wedbush Morgan Securities.

Pachter said he thought Sony probably would not tighten the software locks on PlayStation 3 games but might employ bolstered copy protection on other forms of entertainment downloaded to the console over the Internet.

"Maybe they'll copy protect movies or music downloads," he said.

Whatever Sony's plans, the tempest illustrates the changing nature of ownership as millions of people accumulate vast collections of digital entertainment. Few people realize that when they buy software, music or movies, they are actually buying a license to use, listen or watch.

That's why it violates copyright laws for people to sell copies of their music collection.

Sony was attacked this year for including software on some of its music CDs that surreptitiously installed itself on computers playing the disc. The software was intended to prevent unauthorized copying. Sony later apologized.

Taking that sort of copy protection one step further would be, in the words of one analyst, "crazy."

"What does Sony get from that?" said John Taylor of Arcadia Investment Corp. "Sony gets a black eye. It doesn't make sense to me."

Several analysts said the patent appeared to principally be aimed at deterring game piracy. Indeed, Sony's patent notes that through the complexity of its copy-protection scheme "manufacture of counterfeit software becomes extremely difficult."

And it's not unusual for technology companies such as Sony to register patents either in anticipation of one day collecting royalties from someone seeking to license the technology or to prevent someone else from deploying it.

"These are all things technologically possible to do in any computing device," said one cryptographer, who requested anonymity. "In the video game business, it would be suicide for someone to do this. It's actually possible Sony filed this because they wanted to keep people from doing that."

Nonetheless, online speculation that Sony would use technological or other means to ban the sale of used PlayStation 3 video games prompted one analyst, P.J. McNealy of American Technology Research, to study its potential effect on the industry.

"While we believe it is unlikely that SNE will ban PS3 pre-owned games from being sold by the same chains that sell new PS3 games, we believe this issue remains under consideration," McNealy wrote in a research note issued June 23.

McNealy estimated that game fans spent about $990 million buying used games, primarily from GameStop or through EBay. Much of that spending — about $620 million — is for used PlayStation 2 games.

Were Sony to ban the sale of used games for its next-generation PS3, the effect on independent video game publishers would be negligible, McNealy said.

Used-game sales are a growing source of irritation for game publishers, which receive no proceeds from the resale of games. Executives privately complain that cheaper secondhand games are available for sale shortly after a new game's release; publishers, which give retailers marketing money to promote games, end up competing with discounted versions of their own titles.

Major independent game publishers Electronic Arts Inc., Activision Inc. and THQ Inc. declined to comment.

Meanwhile, used games are a lucrative source of revenue for retailer GameStop, which began reporting pre-owned game sales after its acquisition of competitor EB. Last year, secondhand game sales accounted for $930 million in revenue and $418 million in profit. The profit margin was 45%, compared with 21% for new games, according to Arcadia Investment Corp.

Analysts say used-game sales contribute to the overall growth of the video game market, in the same way that the ability to trade in a used vehicle fuels the new-car market.

"A used-car market creates currency to buy new cars. Same with games. Everybody acknowledges that," Pachter said. "The problem is if the used game is available a week after the new game is out for a $5 discount."

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Nightwish · 07-10-2006, 10:37 PM

How the hell are they gonna keep you from playing used games? I mean, if you buy the game new, then play it once, it's used! Does that mean that you won't be able to play your own bought-brand-new game more than once? I can't imagine how they're going to do that, unless they just start requiring product keys for everything, which is easy enough to get around.

Ultra Peanut · 07-10-2006, 10:58 PM

Yyyeah. Sony's just winning everyone over lately, aren't they?

SLAG · 07-10-2006, 11:04 PM

Quote:

Originally Posted by Nightwish

How the hell are they gonna keep you from playing used games? I mean, if you buy the game new, then play it once, it's used! Does that mean that you won't be able to play your own bought-brand-new game more than once? I can't imagine how they're going to do that, unless they just start requiring product keys for everything, which is easy enough to get around.

From what I have heard the plan is to register to the game to the system its self

therefore you could not take JUST the game to a buddys house to play on his/her PS3

Sounds like teh Ghey

**007** · 07-10-2006, 11:07 PM

Nothing like watching them shoot themselves in the foot. Even if they never implement it, marketing wise, they have already screwed themselves.

SLAG · 07-10-2006, 11:10 PM

hell they screwed themeslfs IMO when they set the Price for the console at 600 bones

Ultra Peanut · 07-10-2006, 11:12 PM

Riiiiiiiiiiiiiiidge Racer!

**007** · 07-10-2006, 11:22 PM

Quote:

Originally Posted by SLAG02

hell they screwed themeslfs IMO when they set the Price for the console at 600 bones

Well... I was leaving the obvious reason out of it.

htismaqe · 07-11-2006, 08:40 AM

And people want to bust on Microsoft...

First Sony embeds a rootkit in CD's, now this. **** Sony.

**the Talking Can** · 07-11-2006, 09:37 AM

how can a company misunderstand technology so badly...

offering your customers less than they get every single moment of every day from their technology? this is a winning business plan?

Demonpenz · 07-11-2006, 09:46 AM

this is good news maybe now those buy and sell game stores will close up

**Baby Lee** · 07-11-2006, 09:48 AM

If you come up with an innovation like this, I can see where you might not want to implement it, but why in the hell wouldn't you patent it? Unless you think you can keep it a trade secret for longer than the duration of the patent.

**Rain Man** · 07-11-2006, 10:08 AM

Quote:

Originally Posted by Nightwish

How the hell are they gonna keep you from playing used games? I mean, if you buy the game new, then play it once, it's used! Does that mean that you won't be able to play your own bought-brand-new game more than once? I can't imagine how they're going to do that, unless they just start requiring product keys for everything, which is easy enough to get around.

It sounds to me like they designed a system where you can replay the game on the original machine on which you loaded it, but not on any other machine. That would sure bite when that machine dies and you have to replace both the machine and every game.

htismaqe · 07-11-2006, 10:10 AM

Quote:

Originally Posted by Demonpenz

this is good news maybe now those buy and sell game stores will close up

and STFD

**the Talking Can** · 07-11-2006, 10:21 AM

Quote:

Originally Posted by Rain Man

It sounds to me like they designed a system where you can replay the game on the original machine on which you loaded it, but not on any other machine. That would sure bite when that machine dies and you have to replace both the machine and every game.

imagine a car that only you could drive....brilliant...

07-10-2006, 06:14 PM
Lzen Banded Join Date: Feb 2001 Location: Oz Casino cash: $-619308	Furor Over Sony Patent (LA Times) Technology that could prevent resale of games and other digital goods raises speculation, fears. By Dawn C. Chmielewski, Times Staff Writer July 10, 2006 Sony Corp. has patented technology that would prevent its PlayStation consoles from playing used, rented or borrowed video games — raising questions about whether the electronics and entertainment giant may attempt to redefine what it means to own something in the digital age. Sony has said little about the technology, patented in Japan in 2000, or how it might be deployed. But speculation over Sony's plans has sparked a furor online as game fans and consumer advocates fret that the company may incorporate it into the upcoming PlayStation 3 console, due to hit stores this fall. ADVERTISEMENT Click here to find out more! They worry that it would wipe out the $1-billion-a-year market for used games and could even prevent someone from playing their games at a friend's house. It is not unusual for technology companies to patent innovations and then never incorporate them into products. Documents filed in April 2000 with the U.S. Patent Office describe a method of copy protection by which the game system would verify a disc as legitimate, register the disc to that particular game console, then wipe out verification data so the disc would be rendered unreadable in other PlayStations. "Since only titles for which legitimate software has actually been purchased and which have been initially registered in the machine table can be used, resale (so-called used software purchase) after purchase by an end user becomes practically impossible," according to the patent documents. Although Sony has been vague about its plans for the technology, "I actually think they're toying with this idea," said Michael Pachter, a game industry analyst for Wedbush Morgan Securities. Pachter said he thought Sony probably would not tighten the software locks on PlayStation 3 games but might employ bolstered copy protection on other forms of entertainment downloaded to the console over the Internet. "Maybe they'll copy protect movies or music downloads," he said. Whatever Sony's plans, the tempest illustrates the changing nature of ownership as millions of people accumulate vast collections of digital entertainment. Few people realize that when they buy software, music or movies, they are actually buying a license to use, listen or watch. That's why it violates copyright laws for people to sell copies of their music collection. Sony was attacked this year for including software on some of its music CDs that surreptitiously installed itself on computers playing the disc. The software was intended to prevent unauthorized copying. Sony later apologized. Taking that sort of copy protection one step further would be, in the words of one analyst, "crazy." "What does Sony get from that?" said John Taylor of Arcadia Investment Corp. "Sony gets a black eye. It doesn't make sense to me." Several analysts said the patent appeared to principally be aimed at deterring game piracy. Indeed, Sony's patent notes that through the complexity of its copy-protection scheme "manufacture of counterfeit software becomes extremely difficult." And it's not unusual for technology companies such as Sony to register patents either in anticipation of one day collecting royalties from someone seeking to license the technology or to prevent someone else from deploying it. "These are all things technologically possible to do in any computing device," said one cryptographer, who requested anonymity. "In the video game business, it would be suicide for someone to do this. It's actually possible Sony filed this because they wanted to keep people from doing that." Nonetheless, online speculation that Sony would use technological or other means to ban the sale of used PlayStation 3 video games prompted one analyst, P.J. McNealy of American Technology Research, to study its potential effect on the industry. "While we believe it is unlikely that SNE will ban PS3 pre-owned games from being sold by the same chains that sell new PS3 games, we believe this issue remains under consideration," McNealy wrote in a research note issued June 23. McNealy estimated that game fans spent about $990 million buying used games, primarily from GameStop or through EBay. Much of that spending — about $620 million — is for used PlayStation 2 games. Were Sony to ban the sale of used games for its next-generation PS3, the effect on independent video game publishers would be negligible, McNealy said. Used-game sales are a growing source of irritation for game publishers, which receive no proceeds from the resale of games. Executives privately complain that cheaper secondhand games are available for sale shortly after a new game's release; publishers, which give retailers marketing money to promote games, end up competing with discounted versions of their own titles. Major independent game publishers Electronic Arts Inc., Activision Inc. and THQ Inc. declined to comment. Meanwhile, used games are a lucrative source of revenue for retailer GameStop, which began reporting pre-owned game sales after its acquisition of competitor EB. Last year, secondhand game sales accounted for $930 million in revenue and $418 million in profit. The profit margin was 45%, compared with 21% for new games, according to Arcadia Investment Corp. Analysts say used-game sales contribute to the overall growth of the video game market, in the same way that the ability to trade in a used vehicle fuels the new-car market. "A used-car market creates currency to buy new cars. Same with games. Everybody acknowledges that," Pachter said. "The problem is if the used game is available a week after the new game is out for a $5 discount." Link
Posts: 42,476

07-10-2006, 10:37 PM	#2
Nightwish 2006 Snipe Hunting Champion Join Date: Nov 2005 Location: A van down by the river! Casino cash: $10004900	How the hell are they gonna keep you from playing used games? I mean, if you buy the game new, then play it once, it's used! Does that mean that you won't be able to play your own bought-brand-new game more than once? I can't imagine how they're going to do that, unless they just start requiring product keys for everything, which is easy enough to get around. __________________ "Human tales? But human don't have tails, they have big, big bottoms that they wear with bad shorts, and walk around going, 'Hi, Helen!'" -- Batty (Robin Williams), in Fern Gully
Posts: 7,013

07-10-2006, 10:58 PM	#3
Ultra Peanut v^V^v^V^v^V^ Join Date: Aug 2001 Location: Holland* Casino cash: $10005177	Yyyeah. Sony's just winning everyone over lately, aren't they? __________________
Posts: 39,518

07-10-2006, 11:07 PM	#5
007 Shaken. Not stirred. Join Date: Sep 2002 Location: London Casino cash: $12170126 VARSITY	Nothing like watching them shoot themselves in the foot. Even if they never implement it, marketing wise, they have already screwed themselves. __________________ My dear girl, there are some things that just aren’t done. Such as, drinking Dom Perignon ’53 above the temperature of 38 degrees Fahrenheit. That’s just as bad as listening to the Beatles without earmuffs.
Posts: 65,734

07-10-2006, 11:10 PM	#6
SLAG Superbowl MVP Join Date: Oct 2005 Location: OOOOOOOOOOOOOLATHE Casino cash: $9910252	hell they screwed themeslfs IMO when they set the Price for the console at 600 bones __________________ Ad astra per aspera
Posts: 11,177

07-10-2006, 11:12 PM	#7
Ultra Peanut v^V^v^V^v^V^ Join Date: Aug 2001 Location: Holland* Casino cash: $10005177	Riiiiiiiiiiiiiiidge Racer! __________________
Posts: 39,518

07-11-2006, 08:40 AM	#9
htismaqe 'Tis my eye! Join Date: Aug 2000 Location: Chiefsplanet Casino cash: $8149900	And people want to bust on Microsoft... First Sony embeds a rootkit in CD's, now this. **** Sony.
Posts: 104,304

07-11-2006, 09:37 AM	#10
the Talking Can Supporter Join Date: Aug 2001 Location: street Casino cash: $9222208	how can a company misunderstand technology so badly... offering your customers less than they get every single moment of every day from their technology? this is a winning business plan? __________________ Clark Hunt: "Thank god for the Dominican pool boy"
Posts: 51,585

07-11-2006, 09:46 AM	#11
Demonpenz Woman should only make babies Join Date: Nov 2003 Location: Apartment "G UNIT!" Casino cash: $-353864	this is good news maybe now those buy and sell game stores will close up __________________
Posts: 54,952

07-11-2006, 09:48 AM	#12
Baby Lee Supporter Join Date: Aug 2000 Casino cash: $8028275	If you come up with an innovation like this, I can see where you might not want to implement it, but why in the hell wouldn't you patent it? Unless you think you can keep it a trade secret for longer than the duration of the patent.
Posts: 95,642