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Microsoft confirms PayPal deal for Xbox Live

Microsoft has revealed a hitherto-unknown feature that is being released to Xbox 360 users in an update which starts rolling out today: PayPal integration.

Although the update, which is being gradually rolled out internationally starting today, is primarily aimed at getting the new firmware loaded onto the console's optical drive in order to support the enlarged XGD3 disc format, it comes with a couple of little extras for gamers to enjoy.

While one of these - the introduction of an optional auto-standby function that triggers after an hour's worth of inactivity - is somewhat dull, the other is of considerably more interest: the option to pay for Xbox Live content with PayPal.

"Once you’ve linked your PayPal account to your Xbox Live account on, you’ll be off and running to use it as a billing option," Microsoft's Larry 'Major Nelson' Hryb explained today, "allowing you to buy content such as Microsoft Points, Xbox Live Gold subscriptions and Games on Demand titles."

Previously, those who wanted to buy content from the company's on-line gaming service were forced to queue up for scratchcards containing a one-time code that can be entered into the system or asked for their credit card details - which are then stored on the account permanently, for future transactions.

The new PayPal integration means that users can simply fund their gaming habit via their PayPal balance - and won't have to share credit card details with Microsoft. As PlayStation Network users recently found out to their cost, this is to be considered a good thing.

It's not a perfect system, of course: you'll need to visit the website in order to link your PayPal account to your Xbox Live account - there's no way to do it directly on the console - while gamers in Brazil, Chile, Colombia, Czech Republic, Finland, Greece, Hungary, India, Japan, Russia, South Africa, South Korea, and Taiwan are excluded from the programme.

For those able to take advantage of the partnership, however, it's a welcome addition to the mix - and now that Microsoft has confirmed that the update shouldn't cause any bricked consoles, there's no real reason not to install the update when offered.