There's no doubt that online purchases are attractive, but they're not there yet and won't be for many years to come.
They are already eating huge market share of Blu-Ray and other optical media... There are more and more providers available in the internet and things like PS3 have/are getting a video service. Unless you are living in a cave (you are the Cave Man
For getting the benefit of Blu-Ray you need something better than 500$ 32" Samsung. Blu-Ray version ain't any better on that setup than a streamed movie off the Internet. Unless you have great home theater, it doesn't really matter. I have 37" 1080p TV in my room. Upstairs is my dad's home theater, 100" 1080p projector with 7.1 sound. In my room, I can't see much difference between Blu-Ray and streamed film. In HT, I do and prefer BR, but how many have a setup like that?
Fiber connection is coming more and more popular at least in area where I live. 100Mb/s for 40€/month is a deal-breaker. 1Gb/s is being tested atm and should be available later on this year. I have 8Mb/s and 720p streaming works just fine.
Sure, keep buying Blu-Rays if you find that great difference and are ready to pay more. I don't. I find it more comfortable to open the website, enter to my account, select the movie and click play. I don't want to go and get the Blu-Ray to watch it, it's already taken an hour to do that. I can live with the quality loss as the movie is still the same