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Report: Next Xbox will require online connection, not play used games

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A new report on Microsoft’s next Xbox is making the rounds today, and it’s not leaving many smiling faces in its wake.

Citing "sources with first-hand experience of Microsoft's next generation console," Edge Online reports that the successor to the Xbox 360 (Xbox 720? Xbox 8? Durango?) will require online connectivity to function, though games will be available in both downloadable and disc form. Specifically, Edge’s sources claim the new system will adopt Sony’s Blu-Ray format and that games will ship with one-time activation codes, effectively rendering used games unplayable.

The report seems to confirm earlier rumors about the system’s banning of used games. Sony’s next system has also been tied to that claim thanks to a recent patent application, though analysts are dubious that either system would really try to squash the used games market in this manner.

“It’s highly unlikely,” Colin Sebastian, analyst for R.W. Baird, told GamesBeat. “They may have the capability to prevent re-sales, but Microsoft needs retail support to sell hardware, and many of their core gamer customers trade a lot of games.”

Killing off used game sales would most certainly damage any console maker’s relationship with retailers like GameStop, who derive a significant percentage of their profits from used game sales. The retailer saw its shares drop sharply Wednesday in response to the report.

Edge also mentions some hardware specs for the next console as well as the inclusion of an advanced version of the Kinect motion-sensing camera system.

Microsoft has yet to officially comment on any of these claims, though they better act fast. Sony has already hopped into the driver’s seat with plans to formally reveal the next PlayStation system at a media event in New York on February 20. Both the next Xbox and the next PlayStation are expected to release by the end of 2013.

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