Installing the XDK opens up access to the help documentation and a page titled “Durango Hardware Overview.” Now this document is marked as preliminary and subject to change, but goes into detail about what to expect the Xbox 720 hardware to include.
The key part of this document is in paragraph 6, which states that every Durango console will include a hard drive big enough to hold a “large number of games.” The machine will also not support “play from the optical disc.” The next paragraph details how games will ship on Blu-ray discs, must be installed, but will allow play to start as the installation is happening (similar to the system Sony is using for the PS4).
The fact games don’t use the optical drive and media post install would mean you could give the game to someone else to install. Microsoft won’t accept that so it looks pretty much guaranteed you’ll have to activate your game online and therefore tie the copy to your account. In other words, no game trade ins or a used game market.
Goodbye Microsoft, hello PS4.