Sony profits from Xbox physical game sales as it ends disc production for new PlayStation games

While Sony winds down disc production for new PlayStation games, other companies' discs keep making it money. Microsoft doesn't print Xbox game boxes itself — that job goes to third-party contractors like Technicolor, who operate under a license for Blu-ray technology. Royalties from that license get split among the format's patent holders, and Sony is one of the major ones. So for every disc sold for Xbox Series X|S and Xbox One, the Japanese corporation takes a small cut, regardless of who owns the console or the game.

Journalist Stephen Totilo dug into how a game actually gets from a studio onto a disc, talking to industry sources — though none of them could speak on the record. The key difference between the platforms is that Sony manufactures its discs in-house in most regions, while Microsoft has to go through contractors who end up paying its competitor anyway. Totilo sent the picture he pieced together to Sony for comment, but the company declined; Microsoft has stayed silent too. So there's no official confirmation of this story yet.

The contrast with Sony's own plans is almost comically ironic. Sony announced that starting in January 2028, new PlayStation games will be digital-only, and the factory in Thalgau, Austria, that has been pressing its discs is already being converted to produce optical microlenses instead. Right now it stamps out around 600,000 blank discs a day, roughly half of which go toward PlayStation games, but by 2028 production there will drop to about a tenth of current levels. Publishers will still be able to print additional runs of games released before the cutoff — the line isn't being shut down entirely. That hasn't reassured players: a petition against the decision has gathered more than 348,000 signatures, and a week-long boycott of the company's services is planned for the end of August.

There's a particular irony in the fact that Microsoft once fought against Blu-ray, pushing HD DVD instead, and used plain DVDs on the Xbox 360 — meaning it paid no royalties at all back then. Sony's format won that war, and ever since the Xbox One era, the green platform has been running on its competitor's discs. The longer Microsoft holds onto physical editions, the longer this arrangement keeps working in Sony's favor.

Where these royalties go from here depends on which direction Xbox takes. Insiders claim the company will unveil a system called Positron as early as August 2026, which turns a physical disc into a digital license tied to that specific disc: sell the disc, and you lose access. It's said to be aimed at Xbox One and Xbox Series X owners with a disc drive, while Series S and the digital Series X are left out, and the feature won't work with every game either — it'll require publisher approval. There's been no official announcement yet, so all of this remains a leak until Microsoft actually presents it.

Do you think Microsoft will follow Sony's lead and drop discs too — or will physical editions actually become its biggest advantage next generation?