At first I disagreed because I use Blu-Ray discs all the time, but then I realized that the only reason I use Blu-Ray discs is because there is a lot more selection on Netflix for Blu-Ray compared to the available titles on demand from Nextflix. If the same movies were available for HD on demand I wouldn't be getting the discs either. It seems to me, though, that currently the publishers are doing a pretty good job of keeping Blu-Ray alive because of aforementioned availability compared to on-demand titles.
However when it comes to games, while it is convenient I don't think I would ever want to shell out $50 for a "virtual license" that I can't resell. And then there are those rare things that you always want to have on hand (for me, it's the Planet Earth series on blu-ray...only Blu-Ray movie that I own).