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Games Entertainment

Legality of Renting Video Games? 97

Posted by Cliff from the starting-your-own-renting-service dept.
Scott McChesney asks: "Where I live seems to be filled with Gamers but there are almost no places that rent console games. This got me thinking about opening one of my own but I have no clue about the licensing of such a thing. X-Box games all say on the back that buying the game does not give you the ability to rent it. I'm wondering what one has to do to be able to legally rent out video games?"
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Legality of Renting Video Games? More

Legality of Renting Video Games?

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  • Blockbuster (Score:1, Redundant)

    by krokodil ( 110356 )
    Ever been to Blockbuster? They have big
    section of Sega, X-Box and Playstation games.
    They even used to rent Gameboy catridges until
    recently.
    • Now this is even LOWER than usual...now we can't even read the whole /. writeup.
  • You have to strike deals with game producers and distributors, probably giving them some portion of the rental fees collected.

    P.S. Blockbuster rents games, don't you have a blockbuster nearby?
  • I'm not sure how it works, but my guess would be that rental places (Blockbuster, Holywood, etc) pay a large fee to the video game makers (buy the games for $1000 each or something) and the maker gives them the right to rent it out. Going and buying a game at Toys 'R' Us and renting it out is illegal.

    • Re:How to make it legal (Score:5, Informative)

      by Erect Horsecock ( 655858 ) on Tuesday March 25, 2003 @12:39AM (#5588910) Homepage Journal
      pay a large fee to the video game makers (buy the games for $1000 each or something)


      Nope. I spent well over 2 years in a blockbuster and we got all of our games for well below (about $20 less) retail from a company named Waxworks. As far as paying a fee to the production companies I know of only one license fee paid and that was to Blockbuster itself for the store trademark.

      I'm unsure and someone will be able to probably correct me but I seem to remember a court case in the 80s regarding rental of copyrighted material.
      • I too worked at a BB several years ago. I remember when Legenda of Zelda came out for the N64. We had a hugh demand for it at our store opening day and we went down to our local Wal-Mart and pickedup 10 copies of the game. We paid the regular $50 that everyone else would pay. I'm sure at the corporate level they get a price break since they buy for several thousand stores, but they weren't anything special.
        • We were franchise as well. And if the owner noticed a game had exploded in popularity unexpectedly like PSX "Driver" he would go pick up four or five copies for the weekend rush.
          • Actually this was a corporate owned store. Corporate told us to go out and buy the games since they were not expecting any more games for quite a while.

      • Re:How to make it legal (Score:2, Informative)

        by Anonymous Coward
        The Computer Software Rental Amendments Act of 1990 17 USC 101 is the law that was passed that you are referring to

        http://www.cni.org/docs/infopols/US.Comp.Softwa r e. Rental.html

        Basically Nintendo and others lobbied to get a law passed outlawing rentals, but a clause in the act allows game cartridgte rentals for consoles, but outlawed computer software rentals.

        "(B) This subsection does not apply to--
        "(ii) a computer program embodied in or used in conjunction with a limited purpose computer that is design
      • I remember when the movie 'High Fidelity' came out my girlfriend wanted it on tape ASAP, she ended up buying from a company that sells to the rental stores. The tape ran her $110, but she had it WEEKS before it was out en-masse, which is what she wanted.

        I would assume that rental games are sold in the same manner, it costs a lot initially but then you don't have to calculate royalties. Everybody wins!
        • This is what they typically do with video tapes (I don't know if it's being done with DVDs or games yet). They release it at a MUCH higher price, then drop the price down to a normal consumer price a few weeks later.

          With this, they know only the video store (and hardcore fans) will pay the $100 rate. Video stores will pay because they want to have the *newest releases*. After a couple of weeks, they have captured the sales to most of the rental stores, so then they drop the price to sell to consumers.

          W
          • I don't know if this is a common practice everywhere but rental video's always seem to be better quality. Some video's you buy in a store are only good for a few viewings without significant quality degradation. So better quality tape might be some of the price difference. Can anyone confirm this ?
            • Having worked at Lackluster for a few years....
              No the tapes they get are exactly the same as the ones that end up retail.
              All we do is unbox the movies, put them in the plastic rental cases with the printed slip covers.
              Then when they get sold as "previously viewed" we re-box them in the retail packaging.
        • You're right about tapes. They do cost much more than the retail tapes, but you can buy them with different kind of plans. Some plans are profit sharing, others are time lease, used, etc.

          It just depends on how you buy the tape and from what outlet. We got most of ours from Waxworks, but towards the end of my stay there Warner Bros stopped selling their tapes through second parties. By doing this not only did they get a bigger piece of the pie, but could bring a heap of purchasing options to the table that
      • I'm unsure and someone will be able to probably correct me but I seem to remember a court case in the 80s regarding rental of copyrighted material.

        This is what you're referring to:

        "For years Nintendo had been trying to stop the burgeoning industry of video-game rentals. It took the largest video-game rental company, Blockbuster, to court and worked with Hill & Knowlton's Massey to attempt to convince legislators to make it illegal. At the same time, Nintendo also attempted to stop video-game rent
      • Actually, the court case was filed by Nintendo. The courts had held up the legality of renting video games, so Nintendo tried to sue for copyright infringement regarding Blockbuster's practice of photo-copying the (copyrighted) instruction manuals. Since it's hard to rent a game without the manual, Blockbuster simply sidestepped the issue by paraphrasing the instructions on the back of the rental case.

    • Re:How to make it legal (Score:1, Interesting)

      by Anonymous Coward
      I believe it's around $100 per DVD. I used to sometimes see price sheets of rental movies at the local rental shop when I was back in the UK.

      I'm going to presume that games must be fairly similar - although $50 a pop would seem reasonable as it this would be around 100% profit to the publisher (although some fees on the back end - say $1 a rent to the publisher wouldn't seem out of the question). The hardest part would be hooking up with the retail distribution chain - I don't know how you would go about d
    • I'm not sure how it works, but my guess would be that rental places (Blockbuster, Holywood, etc) pay a large fee to the video game makers (buy the games for $1000 each or something) and the maker gives them the right to rent it out. Going and buying a game at Toys 'R' Us and renting it out is illegal.

      I worked at blockbuster for quite a while. :\ They pay about $60-160 per VHS/DVD to rent, as for video games, I am not quite sure, however I don't think it was that far off.

      Your best bet is to get a buisnes

      • I beleive that it was only that high if the video had not been released to the public yet. It was the discouragement for people going out and buying the "rental" videos before everyone had a chance to get it. Once the video had been released to the general public, the price was 20-30, the regular price that you see in a store.

  • First Sale (Score:3, Funny)

    by Lord Bitman ( 95493 ) on Tuesday March 25, 2003 @12:33AM (#5588879)
    If you own it, you can rent it. Isnt that how it works?

    May he rest in peace.
    • In Las Vegas perhaps...
    • If you bought it, you most certainly have the right to resell it, and I have trouble imagining how the law would view that as substantially different from renting it. So yes, I think you have the right to rent any copyrighted work you buy.

      Of course I also think the DMCA and the CTEA are unconstitutional, defendants have a right to see evidence used against them, and presidents are elected by the general population. So clearly you should not be taking any legal advice from me.

    • The problem is that you don't own it, but rather a very limited license that allows you to use it if the owner wants you to.

      Just look at Microsoft Office for example, you may only run it as long as you own a copy of Windows, thus wine cannot compete as you still have to pay your "taxes".

      • With a shrink wrap license? IANAL, but that is only enforcable if the UCITA has passed in your state. I doubt even microsoft uses a click wrap license in console video games...

        Then again, what do I know. I think it's fraud if you buy something, take it home and unwrap it, only to find out you supposedly don't own it...

        • Actually, I live in the state and countrt of Sweden, a part of the European Union. Here, it is not illegal (but perhaps imoral) to download stuff for private use so if I was a gamer I would probably not have any problems buying or renting games :)

          The above statement has not been tried in a court, so do not take my word(s) for it.

          • > Actually, I live in the state and countrt of
            > Sweden, a part of the European Union.

            In some European countries (notably Britain) it is illegal to rent or loan copyrighted material unless you are a public library.
      • Most console games don't have an EULA, and are sold on pretty much the same basis that DVDs and CDs are.

        The restrictiuons that they can place on what you can do with the software is quite limited. I don't know whether this includes rental. Logically, I don't see any difference between renting videos and renting power tools, but the media cartels see things differently
      • > you may only run (Microsoft Office) as long as you own a copy of Windows, thus wine cannot compete

        I did not know that. Another strike against Micro$oft in my book.
      • > The problem is that you don't own it, but rather
        > a very limited license that allows you to use it
        > if the owner wants you to.

        Bullshit. If I bought it I own it and can rent it or sell it at my pleasure.

  • Acts of Gord (Score:5, Insightful)

    by n1ywb ( 555767 ) on Tuesday March 25, 2003 @12:36AM (#5588894) Homepage Journal
    If you want to open a video game rental store, then Acts of Gord [actsofgord.com] is required reading.

    "Who is this Gord? Well, let me tell you about Gord."
    • If you want to open a video game rental store, then Acts of Gord [actsofgord.com] is required reading.

      Beautiful stuff! Where are my mod points when I need them? *sigh* Anywho, thanks for the link!
    • My ActsOfGord book will be coming anytime now. :-) I'm so excited!!! -> Fritz
  • I don't think I've ever seen a Video Store that didn't rent console games. Just about every town I've ever been in has a Blockbuster or some other chain-type video store, and even the local mom-n-pop rental places rent console games.

    Just out of curiosity, are you in the US or not?
    • Just out of curiosity, are you in the US or not?

      Heaven forbid that he should tell us what jurisdiction he lives in. He might, in some way, accidentally get an answer that might be in some way relevant.

  • Provided that you own the game, go nuts (Score:5, Informative)

    by cpt kangarooski ( 3773 ) on Tuesday March 25, 2003 @12:41AM (#5588917) Homepage
    17 USC 109(a) permits the owner of a copy of a copyrighted work to use or dispose of that copy as they like, including renting it. Subsection (b)(1)(A) makes an exception for computer software and sound recordings, but subsection (b)(1)(B)(ii) points out that (b)(1)(A) is not applicable to software used for a limited purpose computer designed for playing video games.

    So, provided that the owner of the particular game cartridge or disc wants to rent it out, and provided that it is for a console and not a general purpose computer, you can just go ahead and do it.
    • unless of course the poster doesn't live in the US. I note that he had trouble finding a blockbuster to suit a gamer's needs; where does he live, Canada? ^_-

      You can't walk past a Starbucks before coming across a Blockbuster in this great nation.
      • up here in canada too eh, we have block busters.

      • Re:(mod up, this explains it all) (Score:2, Funny)

        by Anonymous Coward
        Hey come on, if he didn't mention it, he obviously assumed that the entire world uses the law that applies to him. Ergo, he is american.
    • IANAL but given what you've said it sounds like this becomes a question of contract law. If the game has a warning saying that it can't be rented then the issue becomes whether or not that constitutes a binding contract between the buyer and manufacturer.
      • No, it is illegal for a contract to contradict the law. Since the law states that the right to rent console games is specifically given to the copy owner, this cannot be taken away by a contract.

        However, there's nothing preventing the copyright owners from putting whatever stupid clauses they want on the shrink wrap to scare people into giving them more power.
        • I'm afraid that you are quite mistaken in this matter. There are a small number of rights and priveledges that you cannot abrogate via contract (for example, you cannot make yourself a slave). Further, you cannot be forced via contract to commit criminal acts (such as a contract to murder someone).

          Licenses are a certain form of contract, and may include nearly any other sort of restriction you want, including removal of rights of speach, distribution, sale, etc (think about NDA's -- simple, common contra
          • All that is good and well, but if you buy the book or video game, it is yours, and what you do with it only is governed by copyright law, not by contract law. And we decided a long time ago that when you pay for a book in a store, it is a purchase, not a license. Apparently, the law considers video game purchases equivalent.

            So, yes, you can give up lots of rights via contracts, but you don't have a contract with the company that produced the video game. Therefore, it doesn't matter what conditions they

            • When you `buy' software, you're not really buying the software, as you probably already know.

              When you say ``we already decided'', you're talking about the doctirne of first sale (mentioned often in this topic). This will clearly apply to the MEDIUM of the software (manuals, CD's, box, etc), but MAY NOT apply to the *license* to use the software. Yes, this does lead to some startling situations, where someone pays for a CD containing software that they can't use.

              This is not, however, equivalent to losing
    • This is a really late reply, I should have jumped on this a while back...

      Set your browsing to +5, somewhere down the page I go into explaining how these licensing fee's are going to eat up my gamehouse profits. Now onto your comment :)

      is not applicable to software used for a limited purpose computer designed for playing video games.

      In a gamehouse enviroment, computers are pretty much a "limited purpose computer designed for playing video games" The stations are locked down, users cannot use them as "
      • Well to be honest, I have doubts that it'll work.

        First, you'd have to establish that you bought the games. I.e. you're denying that the EULA had any effect whatsoever, because if you only licensed the game section 109 is not applicable at all. I'd hope that EULAs can be invalidated en masse, but it'll pit the entire software industry against you.

        Second, I don't think that a general purpose computer becomes a limited purpose computer merely because it isn't being fully utilized. The law appears to apply mo
  • ...I mean really, the video rental places do it all the time, and I haven't seen the US Marshals at my local BlockBuster storming in when I walk out with some XBox game.

  • CLIFF! HEY CLIFF? (Score:5, Insightful)

    by fm6 ( 162816 ) on Tuesday March 25, 2003 @03:00AM (#5589407) Homepage Journal
    How many times does somebody have to point this out: asking for legal advice from random strangers is a very bad idea!

  • I asked this same question: Gamehouse Ref: (Score:5, Informative)

    by t0qer ( 230538 ) on Tuesday March 25, 2003 @03:20AM (#5589473) Homepage Journal

    Funny thing was, cliff took the time to personally respond. I'd paste the message in this post, but I deleted it from the inbox.

    Video game rental is a big issue for me because I'm in the process of opening up a gamehouse right now. Most game companies, with the exception of Bioware and Epic have just plain greedy licensing schemes that eat up any profit a game house owner might see.

    Here [slashdot.org] are my thoughts on this issue, posted on the story about the price of commander keen. My argument against these licensing fee's go along the following..

    Capcom, Atari, ect all provided more than just a cabinet when they sold you a game. You got a cabinet (physical security) Coin Mech (money validator) Access software (credits) Input Device (Joystick, buttons) Service contracts, monitor, and the game. Usually it was anywhere between a 50/50 to a 25/75 split for the quarters between the cabinet owner and the person that owned the property.

    Now with a gamehouse, I'm providing those first 6 items, while the game company only provides the game. After looking at paying off employee's, loans, and a lease, these fee's are going to be eating up enough of my profits to where me, the owner is going to be lucky to break even at the end of the month. On top of all that I have a machine that needs to be replaced every 2-3 years to stay current with the CPL standard so I can host CPL qualifyers at my place.

    Companies like Id, Activision, well, everyone except bioware/epic all expect a cut out of your gross profits. I could see them asking for a cut from the net, but the gross? That's just greed. No value added services, no special gamehouse edition, nothing.

    I took some time out to write Mark Rein of Epic, to thank him for his companies license free policy. Following is his response.

    Toqer,

    We've had this policy for a long time. Basically if people play the game at your location they might be encouraged to buy their own copy for home and to tell their friends about it. We feel it's a win-win for both sides. The only think we ask in return is that you legally purchase, and keep on hand at all times, a copy of UT2003 for each machine the game is being played on.

    As for images, you're welcome to use screen shots you create for the purpose of positive promotion of our game in your establishment.

    Good luck!

    Mark Rein

    Epic Games Inc.

    How fucking cool is that? Not only do they let you rent it as long as you buy a legal retail copy without fee's, they're more than happy to let me use their images/logo's screenshots for my centers motif.

    Bottom line is, these licensing fee's suck. Ford doesn't charge me for making money on a truck after I purchase it, and neither should game companies. It's unfortunate that for some games (counterstrike) i'll have to pay these fee's if I want to carry the games that will draw the customers. What makes it even less fair, is I plan on playing by the rules, and there are many many other gamehouses that completely skip out on these fee's. I would love to challenge them in court, but as a startup, i'm in no position to do so.

    • I could see them asking for a cut from the net, but the gross? That's just greed. No value added services, no special gamehouse edition, nothing.

      But you read slashdot right? MPAA, RIAA, and how artists get screwed because their take is tied to the net, and nothing makes money because expenses are padded. Same thing here.

      Gross revenue is the only number that means anything. Who's to say that you don;t have a umbrella company that actually owns everything and leases back to the gamehouse. And suprise s
    • (1) Just don't carry the games whose licensing conditions you find unacceptable.

      (2) Sponsor, or contribute to, the development of open source games.

      • (2)(a) Invite geeks to come and use your machines to code/test on. You could rope them off in a corner and put in vending machines so guests can come in and feed the geeks and observe them in thair natural habitat, like a petting zoo. .:)
  • I'll post this because it's not really legal advice but just stating a fact.
    Much like music, the video game companies sell copies of the game (at extremely inflated prices) that you can rent out. They cost in the $600-$1000 range. That's how the company makes money on a game that can be played by so many people.
  • Before I start this, let me just say that I'm not a Blockbuster 'insider' or anything. I read an article a *long* time ago about how this system worked and thought I'd chip into this discussion.

    Do you remember, long ago, when there was no Blockbuster? In my town, video stores were mostly mom and pop shops with names like 'Videoflicks' and 'At The Movies'. They'd have like 1 copy of a new release and you just had to be lucky to get it. If a movie was deemed particularly hot, they might buy two. They couldn

  • I am not a lawyer but my understanding when it comes to software it that you never purchase software, you only license software.
    Purchase implies you can do whatever you want with it because you own it.
    License implies that there are restrictions on the softwares usage.

    • you never purchase software, you only license software

      IANAL either, but I don't believe this is true. See Softman vs Adobe [linuxjournal.com], where Adobe's "not for individual resale" statement was found to be meaningless. Adobe tried and failed to argue that the defendant "licensed" the software instead of purchasing it. We're getting closer, but we haven't quite reached the point where the law is whatever a publisher says it is.

      This is separate from the issue of EULAs which restrict the usage of software, which I also

  • How'sabout this:
    You sell a used game at full-price. This is a lot easier to defend in court if it ever comes to that.

    Also do this:
    Buy games from customers at less-than-full price.

    Sale price minus Buy price equals rental price.

    It's like renting out a game with some extra assurance that they'll bring it back.
    If they dont bring it back, or damage the disc, or anything else that rentals usually have to worry about, you've got the money for a replacement.

    Obvious problems, yes. I'm sure there are ways to get
  • The difference between the two with play the most significant role in the global economy in the next ten years.

    Microsoft is well on its way to ensuring that no one ever purchases their software again and will continue to pressure for legislation that erodes consumers rights of fair use to ensure an annual revenue stream

    Read NO LOGO and you'll get a good idea were some of the big guns of consumerism are heading. Everything is a monthly payment... sure makes that global food and water credit easier to est
  • Gamers may prefer to buy a new game or second hand...but not to rent

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