1.	There is presently 'price protection' around this gap between digital and molecular distribution channels. Brands do not want to destroy their traditional brick and mortar channels by cutting prices wildly online, so margins have an artificial protection for the time being. Brands which are unfettered by molecular distribution, however, have flourished. Witness the explosive growth of online business at companies like Cisco, Dell, Gateway. They have forced competitors to respond to their online convenience and/or intense price competition.
2.	In the consumer world, online sellers have their own problems connecting the consumer with the website, in order to generate these new electronic savings. There is a considerable new customer cost involved in getting people online to make a transaction with the merchant.
3.	Hence the rise of affiliate programs, which are a temporal solution to the problem. Affiliate programs are 'commission sales' programs by online e-merchants. Rather than incur the 'risk' of advertising for new prospects and turning those prospects into customers, e-merchants are enabling virtually any website to get a commission on actual purchases by referred customers.
4.	These affiliate commissions are less than the traditional retail distribution cost, which is fair, because the e-merchant is doing much of the heavy lifting, in terms of merchandising, transactions, stocking, transactional websites, and so forth. But the affiliates are also doing heavy lifting in terms of traffic and customer loyalty.