Companies like Sony don't make big money on a console by just selling to hardcore gamers. They make the big bucks by being inclusive of all sorts of customers including kids getting christmas presents, occasional gamers, and hardcore gamers that live in rural areas instead of urban ones.
They make the bulk of their money through game sales, and if those sales are limited to download only, it would severely drive down their sales by being impractical, undesirable, or impossible to a large portion of their potential customers. Game systems don't stay at $400-$500 dollars forever. Neither do games stay at $60; they hit bargain bins. Consoles in general are designed to target casual gamers, at least eventually.
I remember the days of dail-up modems and their rapidly increasing speeds, too. Connection speeds did indeed rocket up at an alarming pace back then. There were differences, though. Everyone already had a phone line, and the only thing required to increase speed was to personally own faster hardware - often available in cheap software modem versions. Speed increases were univerally available so long as a person was willing to make a one-time investment on hardware. That lasted until 56k, and then speed increases hit a wall while people awaited eventual broadband offerings in their area.
The situation is a lot different now as increased speeds depend on massive investments on infrastructure by utility companies. It's not like someone with 1.5MBs DSL can just got buy a new 150MBs DSL modem, plug it in, and have 100x the speed. It's not just a question of calling the utility company and saying, "Give me more speed, damn the cost!" Most people get an answer of, "Well, we can offer 1.5 or 5.0 in your neighborhood." Some people still get an answer of "no availability." My father-in-law lives in central Ohio…it's a rural area that's over an hour from the nearest major metro area, but it's not exactly the boonies, either. Ohio is pretty well populated in virtually any part of the state. The local retailers there sell out of new gaming consoles and such just like anywhere else. (I know because my brother-in-law tried unsuccessfully to buy an Xbox 360 there when they first came out.) He still has ZERO offerings available for broadband other than the possibility of getting gouged for horrible satellite service. He's been hearing, "We plan to eventually expand into your area" for years. I live in a suburban part of a metro area with over 1 million people and it was only 4-5 years ago that DSL became available in my specific neighborhood. Available connection speeds have changed little since introduction. I know people in slightly more outlying areas that still can't get it. Cable coverage is a bit better, but more expensive.
So, even a hardcore gamer can't just decide to spend extra money and automatically get a fast connection. We don't all live in the middle of big cities with the fastest available connections.
Connections are definitely improving overall, yes, but nothing has been quick about it so far. Unless some kind of great, new, low latency wireless connection that doesn't require huge investments by utility companies comes along, the pace of improvement probably isn't going to change much.
