Microsoft Corp. is planning to sell an Xbox videogame machine that doesn’t use discs or cartridges, a first for a major console maker and a move that brings the industry a step closer to an all-digital, streaming future.The new device, due May 7, will have the same hardware specs as the lower-tier Xbox One S model — Microsoft MSFT, -0.23% sells a higher-end Xbox One X — minus the slot for physical media. It will come with a terabyte of storage for downloading games and cost $249, about the price of a discounted Xbox One S model over the holiday season.
Fewer people are buying games at stores, putting the media on the same path as movies and music. Downloads are a boon for publishers, yielding fatter margins since they sidestep packaging and shipping, and giving retailers a cut of the profits. Electronic Arts Inc. EA, -4.11% said 47% of console-game unit sales in 2018 were downloads, up from 37% a year earlier.
Downloads are seen as a stop along the way until people can just pick up a controller and start playing any game instantly. Alphabet Inc.’s GOOGL, +0.44%GOOG, -0.07% Google in March introduced a Netflix-like service called Stadia that aims to let people stream games from web browsers, phones and other devices — no download required. Microsoft plans public testings of its own game-streaming initiative later this year.
Microsoft Corp. shares fell $0.16 (-0.13%) in after-hours trading Tuesday. Year-to-date, MSFT has gained 19.41%, versus a 16.61% rise in the benchmark S&P 500 index during the same period.
This article is brought to you courtesy of MarketWatch.