I don't think all of those 40+ million PS5s are all for very dedicated gamers, and as the generation progresses further, further sales will probably skew more heavily towards less dedicated gamers. Among that crow, mobile devices are probably a stronger contender than among more dedicated gamers. It's not as much of competition as, say, Microsoft is, but it's something. Additionally, I think phone prices have gone up, which I would expect to correlate with more processing power, and there seem to be more traditional games for mobile devices, so mobile devices are probably a more viable alternative than they've been in the past. I'm sure the big three are wary of the situation and factor it in their decisions.

I know PCs are also priced differently, but like you said, game prices help offset the difference a bit. Additionally, for older games and many smaller games, even more affordable hardware suffices. Again not necessarily in as direct competition as, say, Xbox, but it's something, and if you're willing to pay more, it's pretty direct competition due to the larger number of games your more expensive PC can run. Again, this is probably something the big three have to factor in to stay competitive.

I know the alternatives to the main consoles aren't exactly the same thing, but they do restrict how much space the big three have to maneuver. Dumb down games for a larger audience? Now you're competing against mobile devices. Increase prices? Suddenly PC seems like a more tempting option than before. And there's definitely more things to consider. The alternatives, as different as they are, help keep things competitive, perhaps to a lesser extent than other consoles though.

Yeah, pretty much.  Been digital on books, movies, music and games for over a decade...  I've had zero problems.  I'm so glad my house doesn't look like a hoarder horror scene because I'm afraid of some magic person who is going to wipe my storage drives.  

And thanks to the digital age my laptop is a NES, SNES, N64, GC, Genesis, Saturn, DC, ps1, Neo Geo, Turbo and arcade all in one.  

Physical>Digital.

That's a fact. Don't even @Me. It's fact.

Until the disk drive breaks.  For me that happened on the dreamcast, Xbox, Xbox 360, ps1 and ps3.  But we can pretend opinions are facts I suppose.  

Like I said in another thread, optical discs are shit. But one category of physical media being rubbish doesn't mean all of them are.

Physical > digital.

My consoles all work. Even if one breaks can just find another and still have my copy. Copy breaks can still be found 30 years after the fact. HDD dies and the service is shut down. Can't get it back. I have Wii War games I can't get back. Xenoblade X only exists physically now. Enchanted Arms on 360 only physical copies exist. You do not want the butchered PS3 version. Plus more and more FPGA and Clone consoles are being made. Won't be long until PS2 and DC get one I bet. Ownership is better. That's not an opinion. It is fact. When you can control your own media consumption without it being removed or butchered to be erased in some way. Boils down to 3 words. Han shot first.

One word -> emulation 

Hoarder horror scene? Ever heard of shelves? If thats how you treated your games, then yes, you are better off going all digital. 

So you're preaching illegal downloads? 

Better than buying chrono trigger for 5th time.