Microsoft lobbed another artillery shell towards brick and mortar retailers on Thursday with the debut of its new U.S. online marketplace. Microsoft has been slowly expanding its direct to consumer sales channel over the past several months and launched its first pilot program in the UK and Germany back in July. Currently the online marketplace offers everything from Mice and Keyboards to Xbox games and consoles. Landmark PC software products such as Windows and Office will also naturally be made available.

A disproportionately large percentage of our readers have been shopping on Newegg and Tiger Direct for years. And the idea of buying items online isn’t all that unique to most of us.  Perhaps the most interesting new feature of the online marketplace however, is the option to download software and install it without the need for the physical media. Downloaded software can be burned by the customer to a DVD, but this process is optional. Microsoft will also allow repeat downloads of its software, and offer remote access to product keys. According to Microsoft’s Trevin Chow; "There is no longer any need to pay for shipping costs and waiting for the big brown truck to drive across the country."

We all know that online software distribution is hardly a novel concept, and people have been downloading productivity software and OS’s such as Open Office and Linux for years. Despite these facts however, this is still a huge step for the Redmond based software giant and a further reminder that internet distribution is here to stay. Let’s just hope they find new ways to compress this stuff. I’m not sure how much more of this my bandwidth cap will take!