[quote name='AHEADAMUS']There's definitely a question of whether or not spending on the VC substitutes (and does not add) to that on retail DVD games. It's not really obvious either way. I tend to think they're not full substitutes, though, because of the VC's impulse nature. It's far too easy to just add points, have left over ones that you want/need to add to, and the low prices invite reckless buying.
It's not a perfect comparison, but think about how easy it is to pick up Sonic at $8 vs. the whole collection for $20. I don't think people always think of them as perfect substitutes.[/QUOTE]
Unless we, as consumers, have access to sales data for VC, XBLA, or the PS Network, we'll have nothing but assumptions to make. You make some good points, and as someone who likes to analyze numbers, it's infuriating that I can't make any claims about digital delivery services, their sales trends over time, and their potential impact on "hard" software sales.
I will slightly disagree that these are "impulse" purchases, however. For some, certainly. Don't mistake "convenience" with "impulse." There are a number of people who are planning their purchases (someone mentioned buying Castlevania IV if "nothing good" came out today) in advance, or anticipating nostalgic titles to them, etc. An impulse purchase-based market wouldn't have people shitting their pants about Pinball and Urban Champion, and demanding Super Mario World or Ocarina of Time.
I'm not suggesting there isn't impulse purchasing going on, but that some people's tales here suggest that isn't the case. Take Scobie's "Daddy Warbucks" VC account, mentioned above, for instance. In addition, I have three titles and 5400 points I'm sitting on, and I'm not using them until I really want something, rather than buying Gradius for the hell of it.
[quote name='Scobie']Derf[/QUOTE]
The only ever person on this planet who I have known to say "derf" was probably the coolest person I've ever had the pleasure of knowing in my life. I hope you can live up to those high standards.