The dearth of demos is one of the reasons I see the rise of streaming services like OnLive and Gaikai as such a good thing - sure, their ostensible function is to be a full-blown content delivery system that exists alongside traditional digital distribution and retail channels, but some of the things you can do with those services has tremendous potential for how we look at demos.
Picture an applet on a blog that shows "[Author of blog] is currently playing [Game X]", that, if you click on it, will not only launch the game in question via your web browser, but actually drop you into the game with the author (presuming it's a multiplayer title where that sort of thing is possible of course). That's something Gaikai is capable of, along with embedding links in Twitter feeds, at the end of reviews for the game in question, you name it - if a title is on such a service, you can fire it up and play it for a set amount of time just by clicking on a widget/hyperlink; word of mouth advertising and other existing channels for disseminating information to your customers can be seriously augmented in such a fashion.
As for the usual barriers that arise to halt demo development (cost, time spent focusing on a demo in lieu of the product itself, etc) - none of that would even need to apply, as you wouldn't have to gin together a tailored "glimpse" of your gameplay, customers could/can simply sit down with your actual game and play it for an hour or whatever. Without needing to download and install anything. How cool is that?
Of course, the problems that make those streaming game services 'not quite ready for prime-time' still exist, most notably that the network infrastructure simply isn't as advanced or ubiquitous as it needs to be, but the possibilities technologies like these hold for the future are quite exciting.