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RSEagle said:
I'm a very avid supporter of physical media as well, so I'll naturally oppose services like OnLive. However, the future doesn't look good with digital distribution continuing to grow stronger. I'd say in a generation or two, physical media for new release games will be phased out completely.

This approach seems like a natural to me, if you are going digital download, and also games that are subscription-based.  There is issues with not having physical copies of games and the company sticking around though.  Like, why wouldn't this technology benefit a game like World of Warcraft?  Do an MMO and you can have a game that will be able to work on any system out there, and all you do is sell a simple plug-in.  If this approach works, then OnLive ends up being a servicing company for companies that want to run MMOs.

The industry is moving away from physical media at this point, because they don't want piracy to exist, and they also hate the used game market.  They will try to phase things out, if they can.

One can hate a business model but still like a given technology.  It is important to separate thw two.