A Fedex truck full of DVDs delivers more bandwidth (Gigabytes/second) than your fiber-to-the-home ever will.
Reminds me of one of my professors from university who commented "never underestimate the bandwidth of a 747 full of cds".
An interesting article which more or less sums up my feelings, I could download music on mp3 but then I wouldn't have a pretty box to collect and no backup if my computer goes kaput. It also means that I can have a stack of cds to listen to on my discman at work.
I've just recently started buying cds again (after a 2 years absense of travelling/not having a home/being broke) and CDNOW does a good job of being cheap (and giving me $5 off per-cd in their free prefered member club) and shipping promptly.
I have DSL at home and a T1 (and a 1/2) at work so in theory I could download movies. Instead I am a member of NetFlix, and for $30 I can have 5 dvds at any one time. I prefer it than going to Blockbuster as it comes to my door and more importantly I don't have to worry about watching a film in 1 or 2 nights. They also now have a distribution center in MA so I don't have to wait for dvds to travel from coast to coast
I don't consider DVDs to be a good value for money purchase. They tend to be $15-$25 even by mail order, which isn't great for something I'm going to watch two or three times. This doesn't compare favorably to $4 to go to my local cinema before 6pm and seeing a brand new film. If they dropped to $10 I'm sure sales would dramatically increase.