No idea on the actual year, but it's probably safe to say a steep downward trajectory will start when the newest Xbox/Playstation no longer has a disk drive. I get the feeling that's closer than we think too, with the disc-less PS5 and Series S already being a thing.
There will probably be some stragglers for cross-generation games that still show up on the PS5/Series X, but that probably won't last past a couple of years.
No idea what Nintendo does in that vein though, I stopped trying to guess a long time ago. But the digital incentives they already offer (TotK was conveniently cheaper with the digital vouchers, huh, wonder why.....) indicate they dislike physical games as much as the other guys and gals on the block.
They day I can't hold games anymore is probably the day I finally stop playing them