Here’s some Xbox 360 news that may be relevant to Windows Phone users as well. The latest Xbox 360 system update, in addition to introducing a new disc format to fight piracy, will also add PayPal payment functionality to most territories. Gamers will now be able to purchase Xbox 360 software, downloadable content, and Xbox Live Gold Memberships with PayPal in addition to the existing options: credit cards, prepaid cards, and prepaid codes. The update will also bring an auto-standby feature that puts the console into a low-power mode after an hour of idle time (yay!).

Windows Phone users are still waiting for the option to pay for software with Microsoft Points, which has long been the standard currency on the Xbox 360. At present, credit card payments and adding purchases to the user’s monthly cell phone bill are the only ways to pay. As far as I know, Microsoft has never said anything on the subject. But even if Microsoft Points purchases never come to Windows Phone, PayPal is still fairly likely as it’s similar to credit cards on Microsoft’s end. Let’s hope they don’t drag their feet on bringing us more payment options!

Source: Major Nelson’s blog via Microsoft News.