I saw this interesting graph from Business Insider that shows how movie renting has developed and more and more the Internet becomes the vehicle-of-choice for getting and watching movies.
As even for today the bandwidth becomes more and more an issue - everyone wants HD 1080p movies today - the future will see this trend reversed. At least in the medium term physical media will rise again when we switch to 4K resolution Video - movies at that resolution will make it almost impossible to stream to many Internet users in the foreseeable future. Will people choose convenience over quality - sure. But many will opt for getting a disc delivered to enjoy their 4K TV set which otherwise would be utterly useless.