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RubberWhistleHistle said:

that is an interesting take on the affect digital sales will have on the value of physical media. I dont think this digital takeover will be happening this generation though. i think the way physical and digital is being handled right now will be the way it is handled through the remainder of the generation. 

Nintendo is reporting its total software revenue and its digital software revenue every quarter. The digital share of the software revenue has climbed very fast:

One quarter of the software revenue is already digital, the digital profit share will probably be even higher: no packaging, no shipping, no middleman's cut (wholesalers, retailers), no used games market.

And Nintendo is late to the party of digital content (full games, digital-only titles, DLCs)... Sony's and Microsoft's digital share of revenue and profits is probably even higher by now.