Capacity of physical media has not been a bottleneck for a long time.
The issue with optical media is the read/write data transfer rates. Post-PS2 era, the seek times for optical media became so prohibitive that the consoles started downloading everything off the disk onto the HDD. And now even the HDD read speeds are too slow, that we've moved to SSD and custom I/O interfaces to maximize bandwidth and minimize latency between the execution cores and the mass storage device.
The only way physical media comes back in a big way is if some miraculous solid state media with ridiculous data transfer rates emerges. That's not likely to happen.
If anything, the more likely technology to take-over from the mass storage device's function will be cloud storage. As internet speeds get faster and faster, it becomes possible to stream data on-demand right from the cloud, with only a small pool of local storage needed for buffering data.
We're basically already there with cloud streaming of games, but what I'm proposing differs slightly, in that the games still run on your local HW. It's just that the game install is located in the cloud and streamed from the cloud as needed. Meaning that there's no need to ever worry about local HDD/SSD capacity any more, because all your games are stored in the cloud.
If Sony offered this as a pack-in to the highest tier PS+ service, I think it would more than make-up for the value proposition and would entice way more PS gamers to subscribe.