Retail sales dying out? Unlikely in the near future, but we'll be seeing a lot more data being propagated through the Internet. The technology for mass-transfer of large files is already becoming more and more available (with a wider availability of high-speed fiber optics connections) making downloads much more appealing than retail sales. It also helps somewhat with the piracy problem, and at the same time will cause crackers to shift their attention to legally-downloaded versions of software (be it a game, an application, etc) over software bought from a store or something (since, as you say, the versions often differ).
EDIT: I'll go ahead and say one more thing: DRM will never do what it wants to do (stop piracy). All the games that are 'protected' by SecuROM? Yeah, they get cracked in about 24 hours after release. GTA IV has an anti-crack mode refered to as the 'drunk mode' to stop piracy of the game. You know what happened? Someone just cracked the code and made a crack for the original crack, and people can play the pirated version with no reprecussions. Same with Dead Space, same with Spore, etc.
In fact, people who pirate these games often pirate versions that have had SecuROM REMOVED completely. So they actually play a better version that what you would get should you buy the game (albeit, without online capabilities).
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