"We'd love to figure out how to bring that back. I still think it was a good idea. Maybe it was a little too soon for some people, but I still think there were a lot of good ideas in there. And we'll bring it back when the time is right."

Too soon? Earth to dumbass: it wasn't family sharing that people had a problem with.

There is already zero chance that family sharing worked like some of the more gullible folk around thought it would, and without always on DRM there is actually a negative chance that this thing will ever materialize. It's dead, Jim.

For goodness sake Microsoft, the solution is staring you in the face. Just apply all the benefits to games bought through the Xbox Live Marketplace, but not the discs. You would be adding value not restrictions, which is a better way to sell the concept.

Cool, hopefully people will understand it this time.

But VanGogh only sold one painting in his life. Most people have a hard time with innovation and innovators.

"But we want to stay in the caves" cried the cave people.

DRM has been done before, nothing innovative about it

Why is it so hard for them to just do it? Put it on DL only games and end the issue. This is some stupid joke. What is actually preventing them from doing it. I'd like to here some explanations. I don't find DRM inovative when my friend is locked out of his imported Saints row 4 US copy. Because steam was jerks and changed his US key to a australian copy. And steam support never replied to his problem. I call that not fair to the consumer. If the game didn't use steam. We'd be playing co-op.

Of course there is a car full of clowns of DRM in every HDMI device.  People hated it at first, but now everyone wants it. 

Please hated DRM Steam when it launched, but now people love it.

Now the DRM is either on your digital game or the disk.  What was innovated was how they were using it so that a digital purchase or a physical purchase could be used by the consumer in exactly the same way.

I think they should have offered two operating modes.  But now more people will just buy digital to have the best experience with instant switching, not having to hunt for game disk, or having your sweet but clumsy sister step and break your disk.

Sharing and gifting games should have never left for digital games policy. There is literally no reason they had to take it away.

It need the daily DRM check in to work they way they had it set up.  Otherwise one person could buy a game, and gift it to everyone.

Not understanding why they can't just do it for digital games. Give the option to allow for sharing of digital only games.

Technically you can already "share" digital 360 games.
The main person buys the game signed into their profile on a friends console.
Main person goes up and downloads it on his console.
As long as main person doesn't download the title one more time, the other friend can always play that title without the main person being signed in.
IE I buy DOA5 Ultimate signed on my friend's console, he can always play it as long as I don't download it more then once to my console.
It's how me and my wife have been getting multiple copies for years, mainly XBLA titles though.

Just do family sharing on digital only games. Give people the option to install their physical games permanently and treat it like a digital game for family sharing, but the process would require a periodic online check just like before. At the same time those who don't want to install can use/lend/trade their discs without needing to be online just like now. It's the best of both worlds.

The point is to give people the CHOICE and show them exactly why digital is better. Don't try to force people into digital. You have to give clear benefits that outweigh physical media for people to choose digital.