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DroidKnight said:

I would think it's mainly the older peeps that are being alienated in the move to digital.  There are a ton of them, and are likely doing a majority of the spending.  Many of the older gamers are doing the purchasing for the below 18 years old crowd.  I predict a major contraction in the gaming industry will be occurring for Next Gen. 

60% are still below 34 years old and not to be morbid but the older crowd won't last forever, so it would be understandable to look at the spending habits of the younger audience, as they are the future market. The "older crowd" may do the purchasing for the below 18 crowd but the below 18 crowd still decide what they want and how they want it, a lot of teens will just say "Hey I want this" and their parents will pay for it without a second thought, Lol.

But this graph really needs a breakdown too, what is PC's % in this graph? PC Gaming is the biggest and fastest growing market, bigger and faster than all the consoles, but physical essentially does not exist on PC, it's like 99.9% digital on PC. Therefore a contraction as a result of digital vs physical would only apply to Console Gaming but I'm not really sure that would be the cause of a contraction, consoles as a whole have stagnated for multiple generations now, once the older gamers are out of the way, it will be more about how you convince younger gamers to go with console over mobile/pc/laptops/tablets, etc.