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morpheusx said:
They are pretty much forced to use Blu-Ray as their physical media unless they want to make a console like the Wii that doesn't do multi-media. Because like it or not that is the format the movie studios have decided to adopt.
As far as portability, you could install your games to HDD and you would still have portability by being able to de-tach your hard drive especially if they made the new HDD as small as a standard iPod.

Isn't Microsoft having issues with some of their games taking up a number of DVD's currently?