The initial quality of video downloaded from iTunes was terrible. It was easy to find illegal downloads of better quality which was about when I stopped buying shows on the service after the initial novelty wore out.

It's improved since then, but now the issue is paying $36-40 for a season of shows vs. the same or less (depending on sales) for the same season on DVD. Optical media has the extras and still, slightly better quality on average (comparing standard def downloads to standard DVDs). The only disadvantage to buying optical media is storage if you're the type of person who owns/buys hundreds of movies and shows.

720p video looks fine on a typical computer monitor. It will look fine on a typical 32" display or smaller. But for home entertainment systems with larger displays, the difference is undeniable.

what you all forget is that MOST people buy big HDTV to enjoy movies on it and in most of the households the PC is not connected to the TV(they are mostly even set up in different rooms),,and also most ISP have max size download of 50 GB per month,,it will happen but not for another good 5 -8 years

What are some of the movies you can download from xbox live?  Does it have a good library or is it just the tv shows that you can download from the network websites? 

By the way, average "broadband" download speed in the US is 1.9 Mbps, http://arstechnica.com/news.ars/post/20070529-survey-average-broadband-speed-in-us-is-1-9mbps.html

Also, doesn't look like Virgin Media is getting high marks with its customers .  This is from the link you included.

Its somewhat ironic since Sony is banking on this digital form of distribution to be the format of choice for the PS4. One generation they make us buy Blu-Ray, the next they make us download our HD movies. Oh well, maybe Blu-Ray is just their idea of the physical alternative to downloads for people that want to own a physical copy?

I have to say 'forget about it!' I've seen Virgin service in action at friends with 20 MB and its terrible. No reason to assume 50 MB will be any less restrictive. This isn't going to materially affect physical media sales in the near, medium and probably longer term.

There are too few people interested or able vs those who want to just rent a physical disk or buy a physical disk.

Even if the tech was fully there its an unknown what the percentage split between physical vs digital would be as its not a given that the majority want digitial even if they could easily have it.

I found the title to this thread and the actual topic to be pretty funny. Sure, I don't doubt things will be moving to digital downloads, but that's going to take some time and there is no way I'm going to be paying a crap load just for an internet connection to download a movie when I can go to the rental store and rent one.

i'll stay with my dvd's... but thanks/.