This makes perfect sense to people my age.
Starting with the fifth generation of game consoles, console manufactures began transitioning away from cartridge based game distribution, to optical discs. The sixth generation solidified the optical disc as the only medium on which games would be distributed.
This worked well, first CD-ROM, then DVD, and finally Bluray have all very compelling price to storage ratios, allowing for more, and more detailed game content with each generation.
But what we have now, with bluray, are games that may occupy up to 50 GB of storage (or more if the content on disc is compressed), with very poor random access performance. As a result, video game consoles (Xbox One and PS4) require games to be installed to an internal hard disk before playing.
It's possible for a player to run out of space, and have to choose to delete infrequently used game content. Playstation users can opt to upgrade the internal hard drive themselves (which I've done; it's simple).
So what possible advantage would returning to cartridge-based distribution have?
It would solve the following problems with the current generation: space and performance.
Imagine a console that used SSD cartridges for games. It could use a standard SSD hard drive that one might find in a laptop, with all of the game content pre-installed. It could even provide any necessary scratch space, if the game requires it. Consoles would no longer need internal storage, since any necessary storage would come with the game itself.
It would also solve the performance problem inherent to bluray and other optical solutions. The SSD cartridge game could be executed directly from the cartridge; no need to install it to faster internal storage.
All of this would make consoles simpler and cheaper to produce.
But games would probably be more expensive. Bluray media is dirt cheap (consumer BD-R discs are about $1 each). SSD storage is going down, but it's not quite there yet.
Maybe by the ninth or tenth (PS4 is eighth) the cost of SSD storage will be low enough for it to be an attractive option for game publishers.