This week, Xbox 360 underwent a dashboard update that, among other features, added the ability to download select Xbox 360 games right to your console hard drive.  Loop out the game retailer and sell directly to the customer, right

How well has this been working out and is marketing doing what it should?

ArsTechnica outlines some pros and cons of the system in their look at the new feature, but one thing struck us:

In many ways it would have been easier to sell new games via Games on Demand; we’re used to paying the standard $60 price for new releases, and not having to worry about a game being sold out would have added to the convenience factor. Older titles face fierce pricing competition from stores getting rid of stock, used game sales, and borrowing the game from friends.

The problem with a day-and-date release on Xbox Live and retail is you risk angering your biggest point of distribution, but you also under-deliver on the potential a system like Xbox Live can give you.

Can marketing allay some of those fears by pinpointing digital distribution as a low-cost, convenient way to play a full retail game   Right now we ve seen very little advertising of this option except on a small panel in the Xbox 360 dashboard, and we wonder if that s mainly because of fear based on retailer perception.

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