Xbox's new disc-to-digital program, intended to help players transition their physical game collections to digital formats, is encountering significant hurdles due to the non-participation of several prominent publishers. Reports indicate that games from major companies including Sega, Square Enix, Ubisoft, and Bandai Namco are largely incompatible with the service.

Players attempting to utilize the program with discs from these publishers have encountered messages stating that the games are "not participating in digital licensing." Fan-compiled lists of compatible titles further confirm the exclusion of games like Far Cry 4, Final Fantasy 15, and Dark Souls 3 from the disc-to-digital conversion process. While Xbox has described the service as a gradual rollout, suggesting future publisher participation is possible, the current lack of engagement from these key companies is notable.

The potential economic motivations behind this publisher reluctance are likely significant. When games are traded secondhand or sold privately, publishers do not receive any revenue from these transactions. Converting a physical disc to a digital license through Xbox's service could potentially alienate revenue streams associated with physical media sales and resales.

This situation echoes concerns about game preservation and the future of digital ownership. Square Enix, for instance, has faced criticism for lacking upgrade paths for some of its titles to newer consoles, requiring players to repurchase games rather than offering a digital upgrade, even without save game transfer. The current stance of Sega, Square Enix, Ubisoft, and Bandai Namco on the Xbox disc-to-digital program represents a substantial portion of the gaming market, raising questions about the long-term accessibility and preservation of their extensive game catalogs in an increasingly digital landscape.