The good, the bad, and the ugly of an all-digital disc-less Xbox One S

Xbox One S
Xbox One S (Image credit: Windows Central)

Rumors are circulating that Microsoft is set to unveil a disc-less Xbox One S (opens in new tab) console in 2019, aimed at becoming the cheapest Xbox console yet. The removal of the disc drive will help Microsoft reduce the manufacturing costs of the console even further, making the Xbox ecosystem even more accessible.

Microsoft attempted to foster a digital-focused future with the Xbox One back in 2013, creating a significant backlash. The Xbox One was supposed to be an always-online console with regular online DRM checks, where physical games came with a license attached, limiting the repeated resale potential of the title in question. Only participating retailers would have been able to "unlock" the disc from your Microsoft account for the sake of resale. Microsoft kicked its plans into touch after the community rejected Redmond pushing too hard on digital, contributing to the lead Sony has now with PlayStation 4.

With the past behind it, Microsoft is once again exploring the prospect of a digitally-focused console, but is now the right time?

NPD compares the physical games market to the digital online one over time.

NPD compares the physical games market to the digital online one over time.

It's no longer forward-facing to focus on digital games, because we're already at a point where digital gaming is the norm. The vast majority of gaming revenue across the board comes from the sales of digital games and associated digital purchases, with physical retail seeing its market share wane. Last year, Activision revealed Destiny 2's sales were more digital, than physical, and that trend has only continued as we head towards 2019. Anecdotally, I can say that I've used the disc drive inside my Xbox One consoles fewer than twenty times total since 2013, and that was almost entirely for Blu-ray.

Building a disc-less SKU is a total no-brainer, and Microsoft will have telemetry data to suggest few people are actually utilizing the drive. The issue has always boiled down to upsetting brick and mortar retail stores, which remain a powerful force for the distribution of game sales and, indeed, consoles. Gamestop could turn around and boycott the disc-less Xbox One S if it chose to do so, as they can't scrape extra cash from reselling digital versions of games.

It sounds as though Microsoft may be offering them an olive branch with a disc-to-digital program, via participating retailers. The writing has been on the wall for some time for brick and mortar outlets like Gamestop (and GAME in the UK), which have seen declining revenues from boxed sales for what feels like forever at this point. As global internet speeds increase and bandwidth caps grow, the convenience of digital is winning over millions of gamers.

Additionally, cutting out the middleman, in this case, brick and mortar retail should see more profits go back into the creative aspects of the gaming industry. More money for publishers and more money for platform holders like Xbox and PlayStation would, in theory, lead to improved quality across the board. Or perhaps they'll pass on the savings to the consumer, as we've seen happen with the shift to digital on PC where digital games are far cheaper. Or, execs may just use the savings to buy themselves a new yacht or two, who knows.

Disc-less should be an option, not the new rule

The main criticism from shifting towards a digital future is that it ultimately trends away from consumer agency. If Xbox holds all the digital chips for its games, there's less competition, and thus, less capacity to shop around and find a good deal. This is also looking away from the used games market, which also allows you to get games far cheaper in some circumstances.

The disc-less Xbox One S would be an option, not the rule.

If (and it really is an if) Microsoft's vision is for a fully digital ecosystem, i.e. Steam, Google Play, and the iOS App Store, they'd have to sell some of us on the value that brings. For some, simply owning physical games is part of the hobby, having a collection cycling back generations on display can be fun (and one I participate in myself).

Thankfully, the disc-less Xbox One S would be an option, not the rule. Microsoft isn't going to stop producing physical games in the near term, or even the long term, for the reasons outlined above. Some simply don't have access to good internet packages to switch to all-digital, some simply don't want to for sentimental reasons, and some prefer to buy games used for less. All are valid, and in a way, Microsoft has an opportunity to explore ways to add value for these sorts of gamers as well.

Microsoft has already vastly expanded its refund program for digital games, for example, to offset some of the limitations inherent with digital purchasing. And as vinyl record sales defiantly continue to grow despite the downtrend in physical music retail, there's certainly a thriving market out there for people who simply want to own a thing and not a packet of data.

It should be an X, not an S

Perhaps the most annoying aspect of this reported console is the fact it'll be an S, not an Xbox One X (opens in new tab), and that's something we've verified with our own sources. The S is the weakest console of this generation disregarding the portable Nintendo Switch, and as we move throughout the generation, it is increasingly starting to show its age.

This is a play to improve accessibility to the Xbox ecosystem.

Fallout 76 and Battlefield V both suffer immensely on their Xbox One S version, compared to other platforms, with squished level-of-detail, and crushed textures. As the console SKU with the smallest footprint, it feels increasingly as though developers are ignoring full QA testing their games on the S, instead opting to place their resources on the far more powerful Xbox One X.

Ultimately, it boils down to price. I have no idea how much cash Microsoft intends (or is able to) shave off the RRP by simply removing the disc drive, but clearly, this is a play to improve accessibility to the Xbox ecosystem. The cheaper the box becomes, the wider your potential audience becomes, particularly when you throw in Xbox Game Pass (opens in new tab), which comes with around 200 high-quality games for just $10 per month. A disc-less Xbox One X would provide a better experience for newcomers into the ecosystem, and that's where I'd focus my efforts on driving down costs personally, but perhaps we'll see a discless Xbox One X in the future too.

Weak digital media store


Blu-Ray (Image credit: Windows Central)

A disc-less Xbox One console could compete with the likes of an Apple TV, Amazon Fire Stick, and other smart home digital media devices, depending on how small it becomes as a result of losing the drive. And while the situation is improving, Microsoft's digital media offering remains weak compared to the competition.

Despite pushing 4K the hardest with a UHD drive in both the Xbox One S and Xbox One X, Microsoft's own movies and TV store remains barren for 4K content. The US store has the most 4K shows and movies, but the UK has, quite literally, two movies with a 4K option. Users opting for an Xbox One S without a Bluray drive are effectively sacrificing the ability to ensure they'll have 4K movies available to watch, with little commitment seen on Microsoft's side when it comes to improving the situation, particularly outside the US.

It's a minor gripe though if you don't use Microsoft Movies & TV as Prime Video and Netflix can often more than make up for it, but it's a far cry away from the offering Apple consumers enjoy through iTunes.

More questions than answers

Xbox One S

Xbox One S (Image credit: Matt Brown | Windows Central)

Ultimately, the way Microsoft positions the disc-less Xbox One S, if it even comes out, is unknown for now. Its popularity will hinge on its price, its design, and the policies surrounding it. People are still sore about the way Microsoft attempted to push an always-online console into people's living rooms, despite the fact hardly anyone has their Xbox One consoles disconnected from the internet for any serious length of time. There's no reason to think the discless Xbox One won't follow the same protocols as the current consoles, with a local license available to use offline, and a cloud license available to use on other consoles while online, but who knows?

It seems likely that Microsoft will unveil the discless Xbox One S before E3 2019 in June next year, where Redmond will instead probably focus its efforts on the quality of its first party games lineup. The earliest evidence we've seen of the disc-less Xbox One S dates back to summer 2018, so it seems like it's been baking for quite a while.

Microsoft is focusing hard on expanding the reach of the Xbox platform, exploring things like cloud streaming to phones and tablets, pay-per-month contract options for consoles, and as we can see here, cheaper, more affordable versions of the existing boxes. It's safe to expect to see further innovations aimed at improving access to the Xbox platform as time goes by.

Jez Corden
Co-Managing Editor

Jez Corden a Managing Editor at Windows Central, focusing primarily on all things Xbox and gaming. Jez is known for breaking exclusive news and analysis as relates to the Microsoft ecosystem while being powered by caffeine. Follow on Twitter @JezCorden and listen to his Xbox Two podcast, all about, you guessed it, Xbox!

  • I have an xbox one x, and I've never used the optical drive on it. Don't even know if it works. So as far as I'm concerned I'd be more than happy with a discount for not having the drive bundled in with the hardware.
  • My son made me use the UHD-Blu Ray to watch Spider-Man homecoming because it was HIS Christmas gift, even though I have a digital copy on the network. I've used mine that one time. Other than that I've been purely digital from Day One, and all the console iterations in between.
    Luckily I have an ISP that doesn't data cap.
  • But a disc movie will always be better quality than a digital copy. Uncompressed, lossless audio for a start
  • You also need need the hardware to match
  • A disc movie is a digital copy! It's all down to bandwidth. There is nothing stopping the online streams from being the same quality (and better even) than a disc. Ultra HD 8k has a "pure" uncompressed video bit rate: 144 Gbit/s. Clearly no consumer disc will manage that and so streams will always be compressed down for home use. The highest data rate a Blu-ray UHD drive supports is 128Mbit/s. Home internet speeds are above that in some places and so you could in theory stream the absolute best UHD Blue-ray online today (in some places). But you are right that digital online streams are currently typically much lower than a UHD disc, but are still great for instant access. I'm sure as Internet speeds increase the streamed quality will grow and perhaps in 30 years surpass what the same disk can provide. So a digital purchase today could in theory turn into a better than disc quality in the future. Digital today does of course adapt to network bandwidth... and are invisibly portable (mobile/big screen) and fireproof. Loaning, quality and surviving death are definitely in the discs favor for now though.
  • Well... exclude phone and PC, in US, console digital is still bigger than console package.
    Console (digital + package) is bigger than phone and phone is bigger than PC.
    2017 figure.
  • A discless consolde is a great idea. They should try to make it as small and affordable as possible.
  • I like this idea. Most of my game collection is digital-only now. In fact, when I get the hankering to play a game and it requires a physical disk, it's kind of a let down. How much do I want to play this game to get off my comfy couch and put the disk in? I would say that to get around the possible shortcomings would be to offer external blueray drive compatibility. It would effectively negate the cost benefit of going disk-driveless, but would still be beneficial for those of us that do not need a BD drive. As long as there is an option for a xbox with a disc drive (at least for the foreseeable future). Eliminating the BD would not only get rid of that hardware cost, but also the licensing cost associated with using a Sony-owned technology. With regards to "digitalizing" a customer's existing physical media. I am not sure if each game disk has some sort of unique identifier number (I imagine it does as a part of preventing pirated games), that a user could tie to an xbox/MS account and render the disk useless for resale. That would be the bigger hurdle, I think.
  • I blame the situation of the barren Movies and TV section to the shutting down of the xbox entertainment studios, total lack of foresight. They could have so much leverage points and organic growth points in terms franchises, profits, merchandising, another anchor point for marketing and mix reality - if XES was not shut down. Plus with the advent of voice services they could had alot more accessories tied together by Cortana, such as the Surface Headphones which could have worked in tandem with Xbox and the Windows ecosystem + home automation making for more fluid and cohesive experience instead of the current disjointed experience. Can you imagine walking into your home with your surface headphones, once Cortana detects your Wifi SSID she automatically connects you to your home network. Now, you have access to your home automation products this way you don't have a quintillion always on microphones listening for commands. So now your surface headphones become the nexus point, which they could have replicated with the microsoft band (+ windows phones) and can replicate with andromeda. This solves your contextual awareness issue as well as privacy issues. I am hoping Phil Spencer is given the resources to rectify that mistake because disk less One X or One S will need entertainment value to make smooth the transition to a disk less future allowing them to further grow the xcloud service and it's accompanying ecosystem. Personally, I love having that option of digital or a phyiscal disk as for instance right now my family members are playing RDR2 and once they've finished playing, I'll pick up the disk play it on my console. I can't do that with digital onless you work around it which is a hassle. Also some places have bandwidth caps or may not have broadband connectivity therefore a diskless console wouldn't really help expand the replay value of that console. The biggest issues I see with only a digital console are the following:
    1) We have seen paid apps leave the windows store along with games that people would have sunk hours into as well as money. 2) What happens when a game studio is shelved and revokes all the digital licenses of the games instead of patching out server access? 3) With the elimination of competitive pricing, digital content pricing may not even go down it may go up - especially in the US due to the none existence of consumer protections. 4) What happens if you lose access to your account and lose the financial information such as the card associated to that account so you aren't able to reset your login details? Currently that is an automated process unless you have access to Microsoft store (which most of the world doesn't have access to) and it hardly works... therefore the loss incurred would be far greater with digital only console. Also does that mean you lose access to the account tied to the console therefore all your games and content on that console?
  • In Australia, currently any game you buy digitally is about $30 more expensive than buying it in the shops. So, for us, cost has already gone up in the switch to digital. It's ridiculous
  • Not to mention that games are getting damn big and Australia generally has crappy data plans and connection speeds.... I know you can pay for unlimited data but it costs an arm and a leg on top of already inflated prices.. As for costs, this is where Steam sales and humble bundle on PC are a godsend.
  • That sucks, I was aware the price increase on electronics but digital too? That's just messed up imo
  • Yep, and the issue is that digital games are priced at the RRP, whereas most stores price games more at a direct currency conversion (if you go into target or JB or the like you can generally get brand new games for around $69, digitally over here they are $99). There has been the odd occasion where my housemate and I have gone halves on a digital title that we know we'll both play, which works out well for us (we do the home console thing to ensure we can both play), but usually I buy brand new games as a physical disc, and maybe upgrade it to digital (and sell my physical copy) once it's really cheap.
  • We have an original Xbox One. I preordered the disc for NBA 2K14 with it. That's the only disc I ever bought because I immediately felt like I cared more about the convenience of disc-less than about any of the drawbacks of digital (you really only own a license, not the game; might take longer to install; can't re-sell or lend it out). We do use the drive occasionally to watch Blu-ray movies, but that's about 5 times a year. Most of what we're watching is from some digital streaming service or another. I don't think we would completely give up having a disc drive yet for that reason (whether in the Xbox or a standalone Blu-ray player), but we're definitely moving in that direction.
  • Why?? The new "family" of Xbox consoles is due in either 2019 or 2020. Why buy another Xbox One? Why bother creating another SKU? It's a waste of time and money and it's only going to piss off the less knowledgeable consumers (read: parents, a VERY important part of their consumer base). Just make at least one of the new Xbox's diskless. And include ******* Mixed Reality support. And support for Steam VR games too. ****.
  • Forget generations/families. Since Xbox is backwards compatible now its more like evolution than revolution. Microsoft will not release something totally different in 2020. It will be more like an Xbox X2. Some new features and performance improvements. Games will for sure run on the Xbox S/X, just in a ****** quality (which today is known as normal quality).
  • Personally I highly doubt the S/X will be forwards compatible with whatever is available on the successor. Developers are already talking about upcoming titles on the new systems that aren't possible on the current generation.
  • This is as much a test run IMO. Scarlett will be discless from the start. The console makers and the publishers want this. It’s just legacy and stores like GameStop holding back, until now. As pointed out disc sales continue to drop. This will let them start the clock on the death of the resale market. Something the publishers have always hated.
  • Plot twist: it could be also portable like the Switch :)
  • All I want is digital games to be cheaper than $60
  • Given that the CD ROM drive (BR etc) always go wrong, this will be a good thing. Units can be smaller, cheaper and more reliable (hopefully) with it.
  • Blu-ray is not CD.
  • Because Hard drives never fail, right?
  • As long they aren't cheap brands or cheap ssds... seen a few cheap no brand ssds fail pretty darn quickly lol..
  • I mostly use my Xbox One S as a dvd/Blu-ray player, as I did with my PS3 before. Consoles are better Blu-ray players than dedicated players and they don't break like dedicated players. Just have to buy the media remote control because handling movie navigation with the joystick is frustrating. So no a diskless Xbox wouldn't be for me.
  • As long as it brings down the price to the s land as long as there is an optical drive in the x version for those willing to pay a premium for the ultimate model then there’s probably more pros than cons. MS is the new king of cloud after all. Makes sense that all my titles sit safely out there in cloud world.
  • More and more people are buying digital content. The last time I actually bought a physical game disk, was for my son's birthday and when I bought my Xbox one X last year. The only thing I would say is, they need to go ahead and increase the internal storage to 2TB min and a 4TB max. I appreciate being able to expand the storage, but most people don't think of that, when they first buy a game system.
  • This is another thing, if they want people to go digital only, you need an internal drive to support that, because even 1TB is pathetic nowadays. And given the fact that they don't even use high end drives in these consoles, the cost factor is negligible.
  • Or make it so you can swap out the internal drive yourself without needing two ifixit tutorials. And make it so you can use a 3.5" drive so if you want a 10 or 14TB drive in it, you can have one, because eventually the 4-5TB max capacity of current 3.5" drives won't be enough.
  • It's not that easy to replace the hdd in the xbox one series... which is a major leg up that Sony has with the ps4 (ps3 as well, even the ps2 supported hdds via the modem adaptor) over the xbox one series at present. I got a broken and janky ps4 from my older bro who bought it at £50 for my birthday as a present - I love fixing things and a challenge. It needed a good internal clean and a new hdd... hey presto it's working pretty damn fine with a seagate 1tb 2.5" hdd that cost £36. So for the price of £86 and some elbow grease... I got a ps4... I was on the verge of buying an xbox one x then I thought about the storage issue.. with 1TB you get about 960 odd Gigs... that's roughly 7-9 games in 4k... without any DLC... that's not enough space. Plus I have no space to connect a USB enclosure unless I wall mount the damn thing lol as I am not running a usb enclosure with a several meter long usb cable.
  • With some games, physical is the only way to get them due to various issues. This would make a discless Xbox One a poor value proposition in that respect.
  • Microsoft needs to integrate the Windows 10 game bar with a virtual machine running the Xbox system.
  • The sole purpose of this is so people buy Game Pass, it's not to sell digital games, it's to sell digital subscriptions because people would have to be insane to buy games new digitally. Whether that is a good or a bad thing is up to the individual. As an aside, anyone who thinks this is going to improve the quality of games is delusional.
  • Well, the visual quality of games is no doubt going up... but all these hi-res textures means alot of storage space. The quality of story lines and campaign modes... well given the advent of battle royal games and mmos... that's sadly being left in the dust as of late...
  • Oh, by quality I mean bug free. Digital only won't magically make Publishers give Developers more time to polish their games. Visuals will certainly improve, and my data cap will slowly weep when it does.
  • A disk-less Xbox is Microsoft's way of getting into the set top box market
  • It is ok as an option but if you want a digital only future you are a fool. Take any company. That company's goal is to make money. That company will do whatever they can to make money. Next, look at any digital service. It involves a license and if they choose an internet mandate. When the servers go offline they can choose to revoke your licenses. It's happened before and can again. There may be a future where the money you put into games can be taken. Never give up your rights for convenience.
  • It's too late. The S is too old and weak for an impact. Sure, if they could sell it for $99 with a Game Pass sub it might sell some units. But TBH in Germany the console doesn't even sell for $150, I don't see it selling better at a lower price. And in the US the price is supposed to go down to $199 with the digital console. For whom? For a product that will exist for barely two more years until next gen arrives? If they want to go all-in with a Netflix service they should do just that. Offer the box for free (not free to own, free to use) and sell a mandatory Gold/Game Pass sub for $100 a year. That would make them actual money.
  • Gifting is a problem with digital that I'm currently having problems with. The kids want something to open on Christmas day and not an email.
  • I've never tried but, can you gift the game to yourself (2nd account or something), print the code out and stuff it in the box?
  • I think the main thing they are trying to do here is not cut the price of an optical drive or so save little money.
    They are trying to kill the physical disk market. And at the same time kill the used games market.
    For me, their goal is clear, just like in 2013, they want total control of the platform (like steam). They want everything to go through their stores so that they can control the market. Control the price of games. We'll need to see how much cheaper they make it. Because here they are removing a feature.
    Here it looks like it's only MS that'll benefit by this move. The chart in the article doesn't actually represent the actual demand of physical vs digital games.
    The digital format include subscriptions (which is massive), digital add-on and microtransactions which makes billions and most of these are only sold digitally, mobile and PC which is mostly digital now.
    Also there are many games that only release digitally. It would be interesting to see how many people buy digital version vs a physical version of a game. For example how many people bought RDR 2 on disk vs digitally.