Yes, there are costs involved with physical "delivery" - creating the packaging, safely packing, shipping, time delay while it is shipped.... then if it goes to retail...the whole putting into warehouses, managing inventory, getting to the retail shelf, pricing, (theft off shelf), getting checked out, then folks returning...etc.
major pain...and costs that are eliminated..
Still need to create the "media" and market it, and have the exchange mechanism but the physical handling costs are virtually eliminated.
Where RIAA went wrong was trying to manage "how" one could use what they bought...number of copies, number of times put on a system..etc... and people groaned.
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