What MS is doing is greedy as all hell.
While I *do* think that month-1 used games are a problem (they actually are a huge problem) and are actually worse than piracy (I'll explain), this method of doing things is certainly not the right way to go about it.
Essentially they're just attempting to own the market for used games so that they also make a cut. I hadn't thought of this before, strangely, but MS/Sony also lose when used game sales are made, because they get a cut of everything (through licences/etc). So it's only "normal" that MS is trying to make money off used sales, mostly because they are also losing money.
For the used games problem, here's my take on it (and this is from a developer point of view):
Most games are very top-heavy in sales. They'll sell most of their copies within the first month or so. Very few titles have legs - Nintendo's games being the huge exception here (casual games also have much longer legs than most titles but that's a different type of market).
A massive problem arises when GameStop (and others, I'm not pointing fingers) sells used games, within the first month, at 5$ off the price of the new copy. *THIS* is worse than piracy. Why?
When someone pirates a game, it's impossible to tell if it's a lost sale. Someone downloading a movie could have paid to see it, but also could have went without paying and seeing it. It's not 50/50 either. A lot of people download stuff compulsively. They pirate games for whatever reasons they want. They just want to see what the game is like, etc. This happens QUITE often. Pirated games are not lost sales in a lot of cases.
5$ off used games are, at a ratio exceeding 90%, a lost sale. Why? If you pick a used copy for 5$ off instead of paying full price, you were most likely willing to pay full price. Willingness to pay full price is what constitutes lost sales. It's a lost sale for the publisher/developer, not for the store, obviously (who make bank off it).
So there it is now - Microsoft and probably some of the world's biggest publishers have been complaining about it for a while. Their solution to combating used sales in the past have been online passes, which at least gives them an alternate revenue stream. So now they've probably managed to convince Microsoft that it would be good for them also to have some sort of system in place to control how much stuff gets into the used market and to make money off it.
One last thing I want to address is I seriously don't want to see more comparisons to the car industry, or the book industry, or the movie industry. (The movie industry is a bit closer, but also works very differently).
Used cars are not a problem because car companies make a lot of money off maintenance, parts, etc. Nobody can say "but cars!" because car companies have alternate revenue streams that are incredibly huge.
Books are a different beast altogether. The main difference is books don't have 12 million dollar budgets, so margins are much, MUCH higher on them. A book that sells for 40$ (and those exist quite a bit, especially when it's first-run hardcover versions) makes a ton of money for the book publisher (and hopefully the author). There is also the fact that there doesn't seem to be (in North America anyway - I know they exist in Japan) massive franchise stores that specialize in selling used books that came out the week before. The book industry also has an alternate revenue stream in the form of cheap softcover versions of the books, where they can still make money on the books when they come out on cheap paper, with really cheap covers, so the cost to produce the book is ridiculously low. Finally, books deteriorate much faster than digital media (disc-based media does deteriorate, but not that much) so it creates a need for new copies of books.
The movie industry is different in that it has 2 distinct products it offers: theater viewing and home viewing. Nobody complains about the fact that you pay to see a movie in a theater but can't resell the experience to someone else after the fact. These purchases are non refundable and non transferable. Home viewing has a used market that mostly deviates from video rental stores because the value of a movie on DVD or Blu-Ray really takes a massive nosedive after a short while, so it's not that worth it to sell them back to other people unless they're really rare stuff.
Every industry is unique, and comparing them is doing an apples to oranges comparison. It never really holds up.
All that being said, I do feel that MS is actually going WAY too far with this. Their whole system is centered around the concept of controlling the used market, then it looks like they tried to paint over it with features so that it wouldn't show too much. Bullshit like cloud processing (this is only actually useful for multiplayer stuff as they can now host game servers themselves, which is great because these can greatly scale - the problem before was that everything was P2P and not server-centric, so you had limits on how many players could be present in a game), TV stuff, etc. It's all a shiny coat of paint they hope will hide the nasty underneath.
Before people flame me to death, let it be known that I don't hate used games. I think that they are typically fantastic for lower income people, people on a budget, kids, whatever! Especially if you buy them once the game is no longer being produced (which happens quite fast!) and such it's really, REALLY not a problem. Person to person sales account for such low numbers that they don't count either - nobody cares about those. I personally try to always buy new, but that's because I prefer them new to used. It's personal preference really.
