Microsoft is reportedly testing a disc-to-digital feature that would convert physical Xbox One and Series X games into digital entitlements tied to the specific disc. The capability could become critical if the company's next-generation console launches without a disc drive.

Physical discs remain fully usable after conversion, with the digital license revoked only upon loaning or selling the media.
The company has yet to decide whether its upcoming console, known internally as Project Helix, will include a disc drive.
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Sony will stop producing physical discs for all new PlayStation games starting January 2028, making them digital-only while still allowing retail sales without discs. The shift reflects consumer preference for digital and follows similar moves like Rockstar's GTA 6 box with a download code.
IO Interactive has laid off an undisclosed number of staff after ending its relationship with an external partner on its fantasy game project, widely believed to involve Xbox publishing. The move is unrelated to the successful release of 007 First Light, though it forces the studio to adapt its plans while pledging support for those affected.
Microsoft is preparing Xbox layoffs next week that could close at least five studios, including the team behind Marvel’s Blade, and scrap the troubled project as part of cost reductions. The changes belong to a larger reset under new CEO Asha Sharma while the division contends with slipped schedules, overspending, and an unsustainable operation.