Datel Sues Over Xbox 360 Memory Expansion Downgrade

Datel Max Memory (SD Card for XBox 360

Datel, a UK-based maker of “game enhancements” (somewhat more accurately described on their site as “videogame cheat products”) have filed an antitrust suit against Microsoft (PDF), alleging that the company abused its market position with a recent downgrade that rendered Datel’s 2GB and 4 GB Xbox 360 storage devices inoperable. Now, that only memory expansion products that work with the Xbox 360 are Microsoft’s own, where Datel’s Max Memory cards used to offer four times the memory at the same price.

Datel will be represented by California law firm Howard Rice.

“[Datel’s] Max Memory card plugs into the Xbox 360 and allows a user to store games, characters, and similar information. It permits a player to transport game information between Xbox systems. The Microsoft memory card does exactly the same thing—with the difference that it offers only one-quarter the memory while listing for the same retail price,” said Datel founder Mike Connors, in a statement. “Datel engineered the Max Memory card to be 100 percent compatible and over 50,000 Max Memory cards have been sold without a single report of harm to the Xbox console.”

Datel alleges that Microsoft’s recent Xbox 360 dashboard upgrade removed the system’s capability to recognize memory chips with more than 512 MB of storage capacity, effectively making Datel’s products incompatible and leaving Microsoft the only player in the Xbox 360 memory card market. Datel’s Max Memory cards use removable SD cards for storage.

Datel’s 2 GB Max Memory card carries a suggested retail price of $39.99; Microsoft’s 512 MB memory card also retails for $39.99. Microsoft used to charge $59.99 for the 512 MB card, and reduced the price once Datel’s products came to market.

Microsoft has said only that the recent Xbox 360 update only supports “authorized” Xbox 360 storage devices. Microsoft is apparently the only vendor of authorized storage devices.

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