I think that the companies producing digital media think that "it's the way of the future", but if the PSP Go! is is any indication, they should know that people aren't ready for it right now as the only means by which to make game purchases.
Plus, I imagine that'll put some hurt on holiday game purchases. That's when retail makes at LEAST 50% of their sales. What Grandma is going to want to buy their grandchild a card that has a redemption code for Xmas? If they can't buy the game in physical form at retail, then it's likely that they won't buy the game at all. Again, I refer back to the PSP Go!
I understand that vapor software is much more eco-friendly than their physical counterparts, but it's not like the vast majority of games end up in the trash. People keep games because, in general, they don't stop working. And even if the original owner doesn't, there's a really strong likelihood that games will end up with another owner, then possibly another, and so on. Not like our planned-obsolescence appliances. Microwaves that last 2 years then end up in a landfill. That's super awesome. I better stop before I go too far off topic.