I don't disagree with you but I also have to assume there are contracts / stipulations in place that prevent a publisher from doing this after sony/microslop/Nintendo agree to sell digital / physical copies if your game.

Death Stranding 3 will likely be lost in the stranding because it will not be stored on physical media. This will make Sad Discman really sad.

the right of first sale in the digital space just need to be created to fix this mess

That sounds nice at first, but if you think about it, the logical conclusion is that: rather than an artist making a sale per person who wants to experience their work, they would make sales proportional to the maximum number of simultaneous viewers. With digital ownership, it would be trivial to instantly transfer ownership, so the moment someone is done playing a game or watching a movie, they'll sell it instantly to someone else.

The only content that could benefit in such an economy is low production value slop that seeks to go instantly viral and issue licenses while there's still demand. Then by the time it dies down they're on to their next slop hit. That and live-service titles that try to keep people holding their licenses. Short single-player experiences, and games from small creators who rely on passive income from a few new people finding their game over time would sell a few copies at first, and then the licenses out there would just always undercut the purchase of any new license.

Also the exchanges would make a bunch of money by taking a cut of each sale. Which is arguably better than just Sony or Valve taking their cut.

I don't like it either, but we can't act like right of first sale for digital licenses would solve all problems and not create any new ones.

He pitched it, it was approved, he started working on it.

Then he received pressure to make it multiplayer (presumably to add microtransactions). He refused, so the game was canceled.

Yes, that Kojima. The same Kojima who never sold you a microtransaction, weapon skin, season pass, or even a paid DLC. The same Kojima who never compromised his artistic vision for a payday, the same Kojima who never bowed to studio pressure to make his game "more accessible" or "more marketable". The very same Kojima who had to be forcefully removed from his own studio before he'd allow Konami to have a say in his creative process; yes, him. That's the Kojima you're referring to.

The same Kojima who did not make a Stadia game.

But who is left? Nintendo?

And that's only because Nintendo tend to lag about 5 years behind everyone else. They're not sticking with physical out of their belief in physical games, that's for sure. Half their stuff is already a key and a download.

Realistically, it wouldn't really matter about discs at all if we had real digital rights. The rights to transfer games from one account to another, or even between stores. The rights to copy games to other devices, and copy them back again, or even from an online source if the original disappears for whatever reason.

Physical games could take the form of a keycard with a license on it, similar to a credit card chip. Scan it on my machine to attach to my account. Scan it on another to attach to someone else's account and remove from mine. Run offline by leaving the card in the machine.

Most discs still contain the full game, most physical releases contain discs of the full game

Some physical releases are just an empty case with a code. Some Nintendo Switch cartridges are just license dongles for the game download.

You’ve never owned a game. You’ve only ever licensed a game. This is true for all software. Removing the physical medium of distribution just allows the copyright cartel the control it has always wanted over something you paid for. But they have been hoodwinking consumers over what “purchase” and “buy” and “own” mean. Technically speaking, any game company could send you a C&D and tell you to stop playing their game forever, your license is revoked, and if you ever played it again they could sue for damages. Doubtful they would, as I doubt it would be worth their time; but this does mean they have the right to just decide their work is no longer available and vanish all digital copies; and they could also make all physical discs stop working through system software updates.

Sorry to kind of ignore your question, but I think it misses the point.

Even with only the partial game data on the disc, the disc still held the rights to the game. Therefore, the rights were transferrable. That is to say, you could still sell your disc and it would have value to the next owner.

When you are forced to buy the game directly from the PlayStation store, your game license is no longer transferable. You can't sell your old games, and you can't buy used games from someone else.

All of them contain the entire game. The only functional difference over the early days is that the game data isn’t read from disc while you play.

Not true for the majority of games, however there have been a few that have done this or something like this.

Been seeing this sentiment a lot in the wake of the news and want to stress, most games still come on disc these days. FF7 Rebirth, for example, is so big it comes on two.

Have you tried the death stranding series? I just finished 2 yesterday. It was fantastic. In both, you can tailor your experience - skip cut scenes, drop difficulty to 'story' for frustrating fights, etc. But those games tell a story in a way only video games can. And all the little flourishes that emotionally connect you to your character, like rocking the controller to sooth the baby sealed in your chest pod, are so charming and affecting.

Kojima originally wanted to be a filmmaker. When he couldn't break into the industry, he switched over to making video games.