More alleged leaks are pointing to the console having an always-connected format with games to be installed directly to a hard drive From Techradar:

A supposedly leaked document from the Durango XDK dev kit outlines that the console will also have a Blu-ray player and a high-fidelity Kinect Sensor that will be needed to operate the console. However, once games are installed there will be no more need for a disk, with all gameplay happening via live internet connection.

 Latest Xbox 720 leak suggests always-connected gameplay, hard disk installs