As for the complete disappearance of boxed games, I somehow doubt that. Games grow very quickly in size as the quality of their graphics improves, their size will become an issue since not all people have very high-speed, unlimited bandwidth, uncapped internet connections.
12GB downloads for a game exist, and they won't get any smaller anytime soon. I'd much rather just go to a store and buy it in a box than cripple my connection for several hours. (or longer, if the online store features a slow download, which is more common than you'd think)
Also the physical format continues to evolve, more and more data can be crammed on them.
This 16-layer 400GB Blu-ray disc [http://pioneer.jp/press-e/2008/0707-1.html] is a good example. I wouldn't want to even consider downloading 400GB for anything, the 27GB Age of Conan beta-client was bad enough.