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Corey said:
It's cheaper for me to buy retail than it is digital, games released for $79/$89 are often $99 on the PSN, which makes no sense since digital is similar to buying straight from the factory, you are cutting out that middleman so therefore it should be cheaper, also the fact that it doesn't cost anything to make or take up any shelf space should make it even cheaper.

Perhaps a way to benefit the retailers?

Yea I think it is to help out retailers. It's also a good way of advertising. People walking by in malls can see an ad in a video game store for a game and maybe go in to check it out but if retailers were eventually killed off because of a digital future you cut out that advertisement because then the only way you would see ads for a game is through the online store which you would need the console for. Of course I'm only talking about retailers advertising but companies also have different way of advertising a game ( TV ads for example).