I can see it working tbh
I'm not sure the lack of a physical game box etc will be much of a barrier. People are getting very used to not owning a physical copy of copyright material. Look at music downloads, film subscriptions etc. Even Steam for a more relevant example.
I guess it'll work more like Amazon's Prime model. You buy in to the system (initial outlay) and you'll get a certain amount of inclusive content with that. Then you can pay extra to rent or 'buy' more content. You'll never actually own it.
As an owner of an XBox I know that even owning physical devices and copies of games doesn't mean instant access. Regularly the games will need significant updates before they will play. Younger gamers will probably be delighted at having no delays like that. Parents may like not having to accomodate large boxes of hardware in the house.
Bandwith and latency might be much more of an issue the same as it is now with multiplayer games. Single player games this won't matter too much.
But I can see this all happening quite quickly. The next generation of consoles might be the last.
Biting the hand that feeds IT
