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New technology may compress texture file sizes down 70% [update 1]

At the London GDC (Game Developer's Conference), Allegorithmic gave a speech about some new bits of technology they have been working on that can supposedly decrease the size of texture files by 70%. These programs, dubbed ProFX and MaP Zone 2, may become an industry standard if their lofty claims hold true, while not diminishing graphical quality of current texture files. The company showed a few demos and pretty much wow-ed the audience. An XBox Live Arcade game named Roboblitz used their technology and, in a 50MB game, the texture files were a whopping 280KB. Oh, the game runs on the Unreal Engine 3. That's impressive.

Think about this in relation to the idea of getting rid of the disc format. Many of you complained that you'd be able to get 3 games on the 60GB PS3. Now, however, you could get quite a few more, if this program catches on. Not only that, but the smaller games for download will become even smaller and download times will be cut into pieces. This technology may be just what e-distribution has been waiting for. What do you guys think? Would this make online content/games/demos a lot more appealing for our consoles?

[update: changed the subject line to better reflect the material presented!]