In response to a Twitter user noting that Microsoft blocked emulators in the Xbox store front, Azure Developer Alyanna McKenna has replied with an e-mail from the Xbox QA team. According to the official message, the main reason for the ban has to do with Nintendo. Though emulating itself is not illegal, players can emulate games “from consoles that are still under copyright protection without permission,” which Nintendo is not happy about.
The full e-mail is available on Alyanna McKenna’s Twitter as an image. To summarize, aside from the legal issues with Nintendo, there is a security risk involved with emulators. Microsoft only banned emulators in retail mode. As for why Nintendo has issues with a Microsoft console, you could install Dolphin onto your Xbox Series X or One. Dolphin is a Wii and GameCube emulator. You will still be able to use emulators in dev mode. Since Microsoft considers it safe, it does not plan on changing this any time in the future. However, Microsoft is in the process of bringing “safe and legal” emulation onto the Xbox. More information on that will appear in the future.
I’ll copy and paste my email from a friend at the Xbox QA team :
Thanks for getting in touch with us about the recent ban on emulators on the Xbox store front. We appreciate your interest and concerns.
To answer your questions, the primary reason for the ban is…
— Alyanna McKenna (@AlyannaMcKenna) April 6, 2023
While emulating is legal, there are some gray zones around it. Using emulators is fine, but downloading or uploading ROMs that you do not own are not. That would fall under pirating. When Nijisanji terminated VTuber Zaion LanZa, one of the reasons she broke her contract was because she “expressed her will to perform streams using illegal games,” which could mean that she wanted to play emulated games using ROMs that she had downloaded from the Internet.
Xbox is working on bringing “safe and legal” emulation onto the Xbox but until then, emulators are only on dev mode.