Microsoft Kills The Game Disc

video game girl

Microsoft’s (MSFT) new Xbox 360 “Natal” motion-sensor controls look cool, but the biggest game changer the company announced today could be its new download store.

Specifically, you’ll be able to download full retail games for the Xbox, including “Sonic, Call of Duty 2, Crackdown, and Bioshock Mass Effect,” according to Gizmodo.

If this takes off, it’s going to change a lot of the video game industry. Discs won’t die immediately, but they will eventually.

And while that’s good news for Microsoft — more revenue, maybe less piracy — it’s bad news for a huge part of the game industry. Especially retailers and rental services, and especially used game retailers, like Gamestop (GME), which is down 1.1% after hours today.

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