Pretty sure that’s why we hearing reports of launch stock overwhelmingly favouring the disk drive ps5

You would not see a change in RRP. Which retailers are going to drop them anyway? A new console brings people into the store. The games can also still be sold as digital redeemable vouchers, gaming peripherals and cards. Everything (including retail) is shifting to digital. An all digital future clearly benefits Sony. It currently does. They're booming in it.

The shift has been taking place since 2015. Digital is now 51% of their revenue. 

First quarter 2020 saw 71% of their first party games sold as digital.

Now they're releasing an all digital console.

But they fear an all digital future?

I think they did focus groups and research and found that most people still would want to pay extra for the disc PS5. And that's what I'm seeing online, most people talking about how great the aggressive $399 entry point is are probably planning on getting the disc one anyway, as if you do the math you save money in the long run.

You do make a small point.  If consoles get too high in price, then customers will not buy it.  However if console prices stay low then retailers will not sell it, not in an all digital marketplace.  Retailers make no profit from console hardware.  Sony will be caught in a catch-22.  Regardless of what happens the console market will implode.  PC wins, and therefore Microsoft wins.  That is the natural result of an all digital future. 

All retailers are going to drop console hardware.  Either that or the price will have to rise.  Currently there is no profit in console hardware for retailers.  Retailers benefit from selling games.  Cards are a stopgap and not a permanent solution.  The money for retailers is in actual physical games.  If physical games go, then so do consoles.  Either that or the hardware has to reach PC prices so that retailers can make a profit.

Really, every champion of the "all digital future" has not really thought through the consequences.  It may sound great from a convenience perspective, but retailers do not benefit from an "all digital future".  They aren't going to just mindlessly do what Sony wants either.  Walmart and Amazon could eat Sony for breakfast.  They need to make a profit in order to sell hardware.  With physical games it's not an issue because retailers make money on the games.  But in the "all digital future" retailers aren't making money from the games anymore.  The whole reason Sony is seeing an increase in revenue from digital sales is that they are taking sales away from the retailers.  Sony is competing with their own partners.  Retailers are not going to accept this.  At a certain point, hardware will either need a price increase or the retailers just won't sell it. 

Of course, Microsoft will be just fine.  Even without consoles Microsoft can still deliver Gamepass through other platforms.  Or maybe people use Steam more.  That benefits Microsoft too, because people will buy more PCs.  Either way Microsoft wins.  Microsoft has been pushing hard for an all digital future for a long time now, and it should be clear why.  In an all digital future, Microsoft wins.

I’m seeing the opposite. Twitter full of people who made their move to digital long ago but could only find the disc drive PS5 to preorder. Meh guess we’ll see. 

I love this laser focus on the difference of digital vs physical profits, and difference of 50% vs 100% digital, it's all so relative.
What's the relative difference of 2nd hand market giving Sony NOTHING, compared to mandatory digital giving Sony best possible margins?
2nd hand used market can re-sell single disc to MULTIPLE buyers, so it's not just 2:1 but potentially 3:1 or more that is being lost.
The existence of 2nd hard market doesn't even incentivize Sony to maximally drop prices, since 2nd hand can always beat them.
The most price senstitive consumers will always utilize that, so Sony's long tail sales are always dependent on prestige of not being used.
When 2nd hand is destroyed, they will at least be more incentivized to drop prices enough to maximize capital returns with increased sales.

And crying for loss of game retailers is fine, but Sony does not absolutely depend on them to move consoles.
General retailers sell TVs for similar amounts of money and shelf space, without follow on software business to prop them up.
They can just as easily sell game consoles under same business model, of course also having accessories and so on, unlike TVs.

Yeah neither of those things will happen. Of course there is profit it's just razor thin margins- typically 3-5%. It's all about getting people into their store, or in the case of Amazon clicking on their site. Once they have you in, you might buy something with a much higher margin. If they don't have you in, that's a lost customer. The buzz surrounding a new product launch can generate an enormous amount of foot traffic or views. If the retailer is specialized (gaming), they would actually stand to hurt their business even more, by dropping the product that draws traffic in favour of only stocking products with higher margins and lose those potential customers to places that will stock it. If they don't innovate they die.

They will accept it and if necessary change their business. There's a huge number of electronics products that are sold on razor thin margins- including phones and TV's. I think you're largely basing your ideas on the core gaming business'- like Gamestop and Game etc. They will either adapt or die out. Specialized retailers are the most vulnerable to market changes - see Blockbuster or Tower Records.

I presume you think Sony won't adopt a services approach? They won't see the writing on the wall and miss the train?

PS5de users are also locked out of the used games market, where sony makes $0 on each sale.

(referring to bold)  This is what I've been saying exactly.  They can sell hardware to make a profit, but if they do that then hardware will need to be priced near a PC of similar specs.  Retailers make a profit on PCs and that is why they are currently a lot more pricey than consoles.

I was gonna post it, but you are right, Sony never makes it right. At most they can copy others.