Do people know CDs get scratched, start to skip and go bad? I would say at this point essentially everyone knows that. Do people know hard drives go bad? Probably most at this point know that drives fail.

While I'm not challenging the notion that it would be great to be able to copy your CD and put the content in the cloud, the reality is that we own nothing digit any more no matter how it is delivered to us. The notion that we should have a copy in the cloud is exactly what Sony is offering.

Given the practical reality, I would much rather have a CD of my game that rely on Sony but like music, that is fading into quaint obscurity. The part of the situation that really irks me is with the CD there is no secondary market and when i buy a 5 year old game from Sony they charge me 60 bucks as if it was a new release.

This - games used to regularly drop in price so that if you were patient as a kid you could get more for the same money, and not rush as much. I love rummage sales to this day because of finding so many great deals as a child, but still would save if needed for one in the store. First game I ever got within a week of launch was Yoshi's Island from a second hand store. Physical copies will eventually deteriorate, but they take some time to do so.... Most of my Atari and Coleco stuff still works.