They'll use a dual-format drive. HD-DVD for games & GruRay for movies.

@thismeintiel

Initial cost analysis of new technology is almost always hyperbolic. The same holds true for technical issues as well. Until challenges are overcome it is simply being assumed that they are insurmountable. While in development you have to see these things as being the result of unknown variables. I have read these same figures before they were applied to both the DVD and BluRay formats. Yet when they came to market while expensive were not prohibitively expensive. There is no realistic reason to expect differently from Holographic media.

Companies do not develop technology that will be impossible to sell. They obviously feel that they can make the product cost effective, and the media cost effective. Otherwise they wouldn't be spending the money developing the media. This all before the effects of mass production are made clear. You cannot underestimate those either. That is how BluRay went from eight hundred dollars a machine to a hundred dollars a machine in the span of a single year.

I am not saying it would all be out of the box profitable for Microsoft, but it probably wouldn't be absurdly expensive. Not to mention they follow a loss lead model. So if losing a hundred dollars on a new format gives them a hefty edge they will probably go that route. Anyway the entire storage issue is mostly for chest beating anyway. The truth is the vast majority of games fit onto DVDs. The PS3 didn't need the BluRay it was just equal parts trojan horse, and bonus feature. The games most assuredly didn't need the extra space.

Why would microsoft not go with blu-ray?

It's a well established format by now, disks are cheap to press. A new format or reviving HDDVD would require to retool factories again to press the new disks and make the drives again.

Why would Microsoft not offer blu-ray playback when Sony does. It's just one more thing you can advertise on the box. It won't take sales away from the Zune movie store, Netflix does that much better and they allow that on their console.

Microsoft might reserve a part of the disk again for drm, but making a whole new format doesn't make any sense.

What I can see happening is that they'll offer a cheaper digital distribution only sku next to a premium model including a blu-ray drive. It seems the right time to experiment with digital distribution of full console games on day 1 as steam does, but too early not to offer the option to go the old route.

It will be interesting to see what happens then. Will it go the same way as movies? So that you can download a slimmed down version of the game for less without extras, 1 language, and more compression on sound and fmv. Or buy a premium version on disk with uncompressed sound, high bitrate fmv, making of videos and other extras.

thanks, heres the cnet article i was talking about...

http://news.cnet.com/how-3d-content-works-blu-ray-vs-broadcast/8301-17938_105-20063310-1.html

I was not able to find any source that gave a similar estimate for new DVD or Blu-ray players before they were launched.  Do you have any?

My real point is it would be quite crazy for MS to do exactly what Sony did with the PS3.  Sony was losing ~$250 per system and has only started making a profit on each PS3 about a year ago.  If HVD proves to be even more expensive than Blu-ray, then MS could be looking to lose ~$350-$450 per console, especially if they want to have a graphical powerhouse that can pull off graphics like that seen in the Unreal demo.  And those losses would be incurred even if MS priced the 720 the same as the PS3 launched, $499/$599.  And MS wouldn't be able to to recoup any costs with movie sales or licensing, because this is GE's tech.  I doubt even GE would get any real support for this format, since Blu-ray is still picking up and is seen by most as THE HD physical format, with the vast majority of companies not even planning to release anything HVD related til 2019.  Also, I doubt game companies want to spend more money per game, as the price of the discs will most likely be higher than Blu-ray's initial cost. 

And if MS does go with HVD, they will pretty much be handing Sony next gen.  Sony has already announced they will not be making as huge of an investment in the tech of the PS4 as they did with the PS3.  This means Sony will most likely be going with the much cheaper Blu-ray tech (in 2013, Blu-ray will be incredibly cheap for companies to utilize), as well as a much more powerful upgraded version of the Cell.  I would be surprised if Sony prices the PS4 for more than $499 for the top of the line version.  I think the price would be closer to $399-$449.  And Sony would probably be either losing very little or making a small profit off of each console.

Since next generation every game will be 100% from HDD, why drop DVD? PC games have been using DVD for years, why? Since the games comes mega compressed on disc and then you install it to the PC it works fine, very few games need 2 discs. So yeah i don't think MS will go with Blu-Ray next gen and they will certainly not go with a new format nor HD-DVD.

Neither PS4 nor the new Xbox will play games from discs, i think thats the biggest design fault with this gen. Although 360 has fixed it now, there are still some games that does not have installs on PS3. Even a slow HDD is still at least twice as fast a Blu-Ray disc and imo next gen consoles should have SSD drives.

Only drawback with DVD would be that you would not be able to play Blu-ray movies on your 360. But Blu-Ray players are common now and more people stream than watch Blu-Ray discs, so it wouldn't be a big deal.

I don't think it will be 100% HDD. The best way to reduce loading times is to stream data from HDD and Blu-ray at the same time. Install the data that needs a lot of random access to the HDD and leave the data that can be streamed in large continuous chunks on the blu-ray disk.

Better even with a extra fast smaller SSD drive to be used as cache next to the main HDD. HDDs are still limited to 5400 rpm for laptop sizes. The only way to load GBs of data fast next gen is to get it from multiple places at the same time. Plus Blu-ray drives are a lot faster now then the 2x speed in the ps3.

Remember Halo 3, that was actually slower fully installed to HDD due to smart disk caching. And why wait a long time copying fmv sequences to hdd while they can play perfectly fine from the disk and are already combined with game data to load the next part of the game in the background.

Actually, given how fast Blu-ray can read data from a disc, next gen we will probably see less and less of games having to be installed to the HDD.  If Sony goes with a 6x drive, it will be almost twice as fast as the max read speed of a 12x DVD drive.  And if Sony uses a 8x drive, look out. 

Oh, and there are actually quite a few laptop HDD that are above 5400 RPM.  The one I have in my PS3 is actually a 7200 RPM model.

Ah true, my new laptop actually has a 7200rpm hdd I forgot.

7200rpm will give you 1030mbps max, 8x blu-ray 288mbps. HDD is still faster, and will always have better seek times, but using both at the same time will still be better then HDD alone. Especially if the game unpacks and/or caches data, thus also needs to write to the hdd.

Yeah that arrticle is pretty good, explains things nicely...

Sadly that 1080p@24hz 3D only applies to bluray 3D movies and is quite useless for gaming. Even when PS4 comes out, people who bought 3D TVs now won't be able to do 1080p 3D as the TVs don't suport it.

So those TV broadcasts in 3D using side by side, which is 1080i per eye, are still a better resolution that 360, PS3 (sub720p upscaled) and PC games (720p) can do using framepacking on these 3D TVs.