Can I use x box and playstation games in a video game play arena?

When you purchase an xBox or Wii you purchase not only the physical hardware but also licenses to use the software that runs the product's operating system and to run the video games themselves. Microsoft and Nintendo aggressively enforce those licenses.

I don't know if either company would object to a business buying many of its products and making them available for others to play for a fee. I don't see why they would. And I don't see a basis for an objection assuming that all the products and games are lawfully purchased and the software is lawfully used pursuant to its license.

On the other hand, I can clearly envision objections if you were to swap the product's software around between products and/or when upgrading to new products or even to add-on products. You would end up with a Gordian knot licensing mess. Before you open for business you should have a copyright attorney review the Microsoft and Nintendo licenses that are issued with their products.

I can also envision objections if you used any Microsoft or Nintendo trademarks to promote your business. If you do use any of those marks in your advertising, you need to have a trademark attorney review the advertisements to ensure that you're not infringing any of Microsoft or Nintendo trademarks. Speak to a trademark lawyer before you advertise.

See the responses to a similar question: http://bit.ly/26Bxul