There are two reasons.
The first reason, which is probably the biggest reason, is that optical disc drives are much slower than hard drives installed in modern consoles — at least about 10 times slower and maybe even worse than that. The data on the disc *may* (see reason 2) actually be all of the data that is needed to play the game. However, it’s on the disc, probably in a substantially compressed form, and the amount of data that needs to be loaded per second to provide modern graphics and interactivity is more data than can be read from the optical disc in real time. So that data has to be copied to the much faster hard drive, and perhaps decompressed, for you to be able to play the game.
The second reason is that the disc itself might not actually contain all of the data required for the game. It’s not unusual for new consoles to basically just use the disc as a tool to distribute a unique license key that lets the console know you’re authorized to download and play a game. You still have to download it and install it, because the only data on the disc is a small amount of data that proves you have the right to do that.
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