Xbox disc-to-digital service hits snag as Sega, Ubisoft, Square Enix, Bandai Namco games reportedly opt out

Xbox's disc-to-digital service, announced last month as a way for players to convert physical game libraries into digital licenses, has hit its first snag. Xbox Insider members report that games from Sega, Ubisoft, Square Enix, and Bandai Namco return a message saying they are "not participating in digital licensing" when users insert disc copies and try to add them to their digital libraries. Kotaku's Ethan Gach received the message while trying to play a Ubisoft game on his Xbox.

Most games convert without issue, according to fan testing, but multiple titles from each of those four publishers have given players trouble. Xbox said the feature would roll out gradually, so the affected games may simply not be on the list yet and could be added later. But the "not participating" wording, repeated across several publishers, has some fans worried the companies are opting out entirely. If so, a physical copy of a game like Kingdom Hearts III would not be playable on a discless device without a separate digital purchase.

Kotaku has reached out to Xbox, Square Enix, Sega, Bandai Namco, and Ubisoft for comment.