I like streaming as an option... not as a replacement for anything.
I also hope physical media never goes away.
The first time your internet is down or their streaming server is down or they corrupt your account permissions or any number of things... and you can't watch a movie... when I can pull out a Blu-ray and watch... Also, the idea of all your movies being on hard drives.. I've lost count of the number of people just on this forum who have lost movies (including myself) from their DVR or hard drive when it crashed... but again my Blu-rays and DVDs are still right there on the shelf.
Now... I can see DVD/Blu-ray being replaced by something else... maybe even cheap (some day) SDROM... but not going away.
I'm curious to see what Dish/Blockbuster will roll out here. Part of me thinks it would be very smart to tie their streaming along with Dish so that each business helps the other.
Also nice would be if we could stream to our existing Dish DVRs... though I don't know if all of them would be capable of doing that.
I believe it will be a long while before we see anything beat the 1080p/24 from BluRay.