I respectfully disagree on the net neutrality issue. The "preferential treatment" scam is just an anticompetitive move on the part of the major transit suppliers so they can restrict competition and provide their own (overpriced) services and extort a cut from those who are already charging the recipients of services (i.e., membership website owners) but are not owned by the major transit provider.

There is still plenty of money to be made on providing transit. Customers on the receiving end (those viewing sites and reading email) pay for transit, and customers on the supply end (those with webservers, mail servers etc) *also* pay for transit. The transit providers pay each other (or barter) for peering arrangements. So the major transit providers are making money on both ends already. And as bandwidth needs increase, such as for video services, so do the revenues. Plenty of money to build out new services. It's worked for over 12 years since the Net became commercial in 1994 at a time when the "backbones" were mostly T-1 and T-3 lines and are now nearly 100% fiber. It will continue to work if net neutrality is imposed.

The loss of net neutrality will near-eliminate the level playing field that now exists where small providers, small webmasters, individual blog owners, can all know that their content can be viewed by anyone with a Net connection. You can bet that a "decrease in priority" of traffic from those who refuse to be extorted will eventually become an "elimination of service" to those same folks.

Now... about physical DVDs: Pretty much everyone I know says the physical product will eventually die out or become a tiny fraction of sales. Most people are saying 3-5 years, and the smart distributors are already starting to line up their ducks to be involved in the electronic download shift. Of course, widespread acceptance of Blu-Ray or HD-DVD may slow the demise of digital delivery for a while, until enormous bandwidth is available to the majority of homes, but I think it's a near certainty that physical sales will eventually slow to a trickle, just as physical CD sales have slowed drastically other than through chains like Wal-Mart.

Most of the distributors are reporting that small bricks-and-mortar adult stores are struggling badly. Many have gone out of business or been acquired by one of several mega-chains of 100+ stores. And I think that's just an early sign of what's to come. At the moment, online retailers of physical product are growing in the marketplace, but that, too, is probably a limited life business.

Of course there will always be some people that want to own something physical, which is why books and magazines still sell... but I do think that any company producing DVDs that isn't thinking ahead to the age of digital delivery will probably not be happy in a few years.