“With the next Xbox, you supposedly have to have an internet connection, and the discs are watermarked, whereby once played on one console it won’t play on another… So I think the generation after that will be digital only.”
Which is all well and grand if you want to ‘protect’ your IP, gain revenue etc but there would be many situations where a genuine xbox user was frustrated by this situation:
1. Where a console dies (who’s to say Xbox wont screw up with another round of RROD?) and a new one is required.
2. Someone sells their Xbox for whatever reason and gets a new one down the track
3. LAN Parties where people bring their disks
4. Someone steals your console but not your games
5. Your dog eats your console but not your games
6. Someone wins a 'novelty' Xbox from a gaming studio etc as part of a promotion.
That’s just off the top of my head, I’m sure there are more ways that such a policy would hamper legitimate uses of games.
Off course this is will moot for when the console industry goes fully digital however, does Sony or Microsoft really want to piss of their communities in the mean time?