Im open minded about digital downloads & would probably get more if I had a proper gaming PC and a bigger HD than my laptops & I could play & fit more games on it. I use Steam & I still buy physical copies of games. Downloading games can be a long process if you download them the minute they release & get caught in the download traffic but they also give you the option to preload them. Handy if you have a free night & you want the game the minute it releases but cant get to a midnight opening anywhere.
At the moment digital will always lag behind but soon it will become second nature for companies to release games onto these services & more & more of them will pop up. As Internet services improve & the digital services do, more & more people will opt for them. Steam gets
more popular every year (1 million+ extra users in 4 months) & the reliability of them continues to improve more people will opt for them. Easier to click a button and get games right then & there for some who live nowhere near stores.
They arent phasing out physical purchases & doubt they will ever fully phase them out. As even some XB arcade titles get physicial releases if they sell enough (The Walking Dead) and even some popular DLC (Undead Nightmare for Red Dead) amongst others. So often the digital release is a way to test the waters before a physicial release. With next gen consoles having you install the games to the Hard Drive its not that different from having to wait to download a game.
I mean everyone thought Blu Ray was a waste of time & now its killed the DVD format. Still not as popular yet but DVD will disappear altogether eventually as Blu Ray gains popularity.
Plus, if your console breaks or gets wiped, then your game goes and your game progress.
If your console breaks (Hard Drive) you will lose save progress regardless of format you have it on, however if disc breaks you have to buy another. Once ive purchased anything on Steam etc I can transfer it to any of my machines without any extra cost & can backup my saves on HD/Memory Stick & Cloud to prevent lost progress. So there are always saveguards there & if you lose the game off your HD you can simply redownload it free of charge. If you lose a disc then its gone, unless you get a no CD patch which is essentially like you having a digital version as you dont have the physicial copy. There are games I purchased on my old gaming PC before it died years ago that ive found in my library on my laptop & redownload them on it.