On last week’s podcast, we talked about what it would take to make OnLive a must-have service. One of the suggestions was to go the Netflix/Gamefly route, maybe in conjunction with an existing mega-retailer brand.

Now we get word in The Street’s interview with GameSpot’s CEO Paul Raines that the retailer is studying Netflix’s model for digital distribution.

We are looking at other successful multi-channel stories like Netflix. The technology is clear — what’s not clear is the chronology. We are getting a good picture of how to balance digital and physical content.

As digital distribution continues to chip away at the brick and mortar retail chains it is going to be exciting to see what companies like GameStop do to stay relevant.