Fuck 'em....if and when this news is confirmed; I am going to do 2 things:
1) Refuse to ever buy it (my PC rig will get the cash instead of consoles)
2) I will pirate the shit out of every single XB360 I own - I have 5 consoles in my home now, and they will ALL get chipped and flashed and made ready to run copies and non-official code - and I will also pirate every game from my back log - I'll snap the discs that haven't yet been played but that I own in half and download illegal copies of them just because I can, and any game that I MIGHT have been tempted to buy in the console transition years will strictly come from the black market as well.
These money grubbing control freaks can suck my balls if they think for one minute that I have any intention of supporting ANY product that tells ME how I can CHOOSE to use it or place draconian restrictions on me as part of the deal for using said product. Its time these fuckers wake up and realize that the only thing that gives any of their product value is the desire of people to experience it. Start dictating how that can happen in such ham-fisted ways and its game over, pun intended.
I dare them to be this stupid.
Piracy apology is a very fast way to account suicide.
People here is overreacting A LOT.
Not even the devs, with their devkits will know for sure what MS will do. Even if the devkits are able to detect somehow second hand games, or even if the devkits require internet connection, they CAN'T know what will be MS policy about internet connection and second hand market. And those are also options that can be disabled with a simple firmware upgrade if the result are not
I don't see a mandatory internet connection to play physical games because that will leave a good chunk of their userbase out. Maybe they will require a mandatory connection each time that you play a digital game, or each time that you play a physical installed game (to allow complete installations without requiring to add the physical disc anymore, but preventing the installation of retail copies in several machines). But the regular "buy retail game, play the game on the console" won't change.
I don't see also a "ban second hand games". Those games generate money in DLC form, so I don't see them banning you to play a second hand game. But maybe that can introduce some kind of "generic online pass" (or even a "generic offline pass", to get a part of the benefits of the second hand sale). Or maybe they will simply ban the second hand games that have been tagged in a lot of different machines, to prevent the game rentals.
But we don't know. The devs don't know, they only can know the possibilities of the machine, not how MS will use them. Probably even MS don't know yet, because it will depend of a lot of factors that are not clear.