What? Before Steam, brick and mortar PC sales were already down. Even stores like Gamestop and Bestbuy lowered their inventory. At the end of the day people just wanted to pop in a disc and have the game work without worrying about patches, drivers, and expensive hardware config. I feel that this was one of the main reasons for the downfall of PC Gaming back then, besides consoles catching up in terms of graphical quality.

While Steam doesn't solve everything, it makes the software portion of config way easier; not to mention the games are way cheaper than what normal retail stores would charge.