You know the three Rs: reduce, reuse, recycle. It's good to recycle, but it's better to reuse if possible and far better to reduce by not generating products in the first place.
According to recent news, 48% of the PC games purchased in 2009 were sold online rather than at retail. If one can assume that those games would have been purchased at retail in lieu of digital distribution, then digital distribution has allowed the PC game industry to achieve a nearly 50% reduction rate!
That assumption, of course, is faulty. Because digital distribution increases convenience and enables impulse shopping, many of those sales would likely not have occurred at all at retail. Furthermore, the decline of PC games's retail presence over the years forces some sales to be digital anyway. So let's slash that figure in half. Even a 25% reduction rate is great. That's a 25% reduction in the materials and energy used to publish, distribute, and sell PC games.
The console games industry may still rely mostly on retail sales. But consoles' memory size grows to allow more games to be stored in memory rather than on disc. Also, consoles' online shops offer new, download-only games that are quite popular and increasing in sophistication. Perhaps the next generation of consoles will achieve parity between online and retail sales.