The problem with physical media is that
1. It breaks
2. Distribution is slow and expensive compared to digital
3. Every time we want to make advancements in quality, they make you pay again. This last one is my biggest gripe with DVD-->Blu-->Future
4. Also, the proprietary nature of Blu-Ray sucks
For those of you who talk about how you don't get alternate commentary tracks, etc with digital
1. That's possible with digital
2. Most people don't care