Developers, naturally, would like things to be easier for them in having a larger storage capacity. However, those who work on the 360 either do not need it now, or have to work with what's there.
They deserve credit for this achievement.
But anyone who implies that DVD is enough for this generation is delusional. Although the sheer size of Blu-Ray is not justified, 9 odd Gigs in itself will not be enough for future games, assuming the developers want to make bigger and better games.
Having said that, compression technology is continuing to improve so the need for a higher capacity media may not be as soon as people think.
However, compression in itself means the loss of certain quality aspects that could be related to "High Definition next-gen experience" such as the 7.1 uncompressed sound we are coming to see in certain PS3 titles.
Do not forget Microsoft refused to include a HD-DVD drive into their machine for cost reasons and the fact that of data stream from the drive not being fast enough, resulting in slow loading times. This would mean they'd have to increase their HDD unit space to compensate, seeing a large cache for developers to use in relation to loading times, and would have led to the demise of the Xbox 360 Core idea.
As a result, they have responded to Sony's claims by saying DVD is suitable for next-gen games, to justify their decision. And although this may be true for now, you cannot deny that if the price was right for them - they would have included some kind of larger format drive into the design.
All in all, so far the DVD camp are holding their ground but I question for how long.
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