The increasing popularity of digital games won't dramatically affect sales of boxed releases, Xbox Live product manager Pav Bhardwaj has told OXM - some customers will continue to prefer buying on disc, particularly when it comes to those eye-catching special editions.

"I don't genuinely believe that there will be more digital and less physical product," Bhardwaj told us in an interview. "I actually think the entire market will grow. I think there's room for both - there's a certain type of customer who really wants a physical product, because who doesn't want those steelbook limited editions? I think everybody wants those. And there's a certain kind of customer who will also want the digital.

"So I think there's room for both, and it's our job to grow with the entire industry going forward, and offer people who want a certain product a certain way, that particular product in that way, and for people who want a physical product, to carry on buying that."

Xbox Live's audience is ageing, Bhardwaj added - buyer tastes are being shaped as much by this as by technological change. "I can't really talk numbers or actual detail, but we actually are seeing the entire breadth of the Xbox customer base growing. It kind of ranges from that young customer all the way up - we're seeing more families involved, core gamers are growing up and having kids, who are now enjoying the Xbox 360.

"So it's really moving on with the customers we had originally, they're carrying on - I think they're also going to buy the Xbox One, and keep the Xbox 360 maybe in a bedroom somewhere. We're just seeing it expand."

It would be nice to think that age corresponds to better behaviour, but anecdotal evidence suggests that the "adult" among us are just as liable to misbehave as the young 'uns. Microsoft is working to police Xbox Live's community more effectively via a new Reputation system, which stealthily pairs troublemakers with one another during multiplayer, rather than with respectable users. The manufacturer has also expanded and refined its Achievements system in time for the launch of Xbox One.

As reported by Gamespot, Xbox Live's audience currently encompasses some 48 million users, of which 40 per cent are women. This last figure apparently represents a "giant change" from when the service was introduced, in the words of Microsoft's chief financial officer Kevin Turner. Can you think of any other "giant changes" we might have skipped over?

http://www.oxm.co.uk/62871/microsoft-xbox-live-users-are-growing-up-digital-wont-kill-off-physical-games/

Disagree with the idea that the Xbox is like Nintnedo. A small minority will have brand loyalty for Xbox, but it's by FAR the weakest of the three. People aren't going to look back at the first Xbox 30 years after it launched and feel the same way people of my generation feel about the NES.

I disagree, I think physical media is on the way out, and the policy change people complained about, some who worked at the like of GameStop, will only hasten the shift.  As you have to stay digital to get some of the quick swapping features.  We shall see more if we can track digital sales. 

Think about Halo 5 having a significant ports of it's opening day sales coming from digital.

I took some family films, had them converted to digital, and given to my siblings and uploaded to the cloud. Now, if something happens to one, it will still be there. It also lets my parents watch their kids at any time without setting up the projector - as easy as sticking in a DVD. They do not degrade, get lost in a flood, or damaged.  And my nieces and nephews can make fun of their parents fashions from 20+ years ago.

Common Game stores that sell disk are one of the few physical medias left.

In remembrance of Music Stores:

You can see how 'Compact Disk Warehouse' was there, long ago.

HALO!

Xbox has created many fans, It took half of Sony's base, so not sure what you're talking about.

Look ps2/xbox sales, then Xbox 360/ps3. MS has come back extremely strong.

As far as brand loyalty, you are completely wrong. Games like halo creat loyalty. watch what happens when halo launches on the xbox ONE. you will see loyalty.  Hmmmm. what sony game sells like Halo? Oh, non.

halo has a following for sure but it's not what took half of sony's sales.  $400 vs. $600 is what took half of sony's base.

xbox 360, much like ps2, thrived on 3rd parties.  they don't have a ton of exclusives.  many of their early exclusives like bioshock turned out to not actually be exclusive.  and MS doesn't actually own their other big exclusive: gears of war.  i personally don't think there is any more loyalty to xbox than there was to ps2 when much of the market left for MS.  there are some loyal fans for sure but mostly just non-loyalists.  we'll see.   ..but to be frank, any platform that sells significantly more than 10M is going to be comprised of mostly non-loyalist as i don't think any of the platform makers have more loyalists than that.  most of the market just aren't going to be loyal to anything in particular. 

but sony does have it's halo, gran turismo.  that was their halo of the ps2 era.  today, i'd add whatever naughty dog makes to that list.

what a sick joke. "audience growing up" ? C´mon... the obvious audience for M-rated games are, basically, teenagers.

I plan on going mostly digital next gen. Hell, more then half my games are XBLA titles.

Actually I was going to go all digital on the launch titles but MS decided to release that awesome 3-some box art as posted in the OP, so I'm buying disc based versions of all those games. I'm getting Ghosts digital on the 360 so I can get the XB1 version as well for $10 more. If companies push digital benefits more I'll defenitely go more and more digital.

Only boxed game I bought on PC the last few years was the Diablo 3 collectors edition.

I wish Nintendo would push as hard with the digital front so I could buy most of their games digital as well.

SInce i hardly trade in games it makes sense. If someone were to ever steal my consoles/lost in the fire I could keep all my saves (cloud storage) and re-download every game I bought. It makes more sense to me.

Come back to me when it's the year 2031, and Halo is still on the top of the charts.

ehh not really a halo fan at all... but I'm greatly interested in the xone and will probably get what ever halo elite bundle is coming out as halo is a fun game especially for co-op and campaign on the early games I played.

The problem with digital distribution are the size of these games. When we get to next generation I predict the average game size for a AAA title is going to clock in at 35GB and I doubt people have large bandwidth caps or very high download speeds. The average download speed in the US is around 1 megabyte a second so the average time to finish a download is 10 hours.