Microsoft is working on the first major game console to lack physical game media, targeted at markets where downloaded content is prevalent. The console could be a variant of the existing Xbox One / Xbox One S, but will be slightly cheaper for lacking the roughly-$25 optical drive. For those stuck with physical copies of games, Microsoft could roll out a "disc-to-digital" programme that converts your physical disc ownership to a digital ownership.

The way "disc-to-digital" works is you take your physical games to a participating brick-and-mortar retailer, who will verify that the disc is authentic (you probably wouldn't need to provide proof of purchase). Once a disc is deemed authentic, the authorised retailer will keep the physical copy in exchange to adding the game to your Xbox account. To play the game, simply download it to your console's hard drive and play. You can also download to external USB storage devices if your hard drive runs out of space. For some regions, there could even be "mail-in" services. Microsoft could target very specific markets with the console, in which Internet access is both affordable and fast, and in which there already are many customers with large digital libraries. The company is unlikely to stop selling consoles with optical drives, but those will be slightly pricier.