Turning to digital media allows you to clear out your life and save cash at the same time, writes Danny O'Brien

THIS YEAR two of my friends are giving each other a negative Christmas gift. They're going to the other's house and spending a day helping them throw out stuff.

They're both delighted. Their houses are full of paperwork, clutter, kitchenware and clothes that they don't want, don't need, but don't have the stamina to throw out themselves.

I've just moved apartment in San Francisco and I've done the same thing.

Call it another kind of economic downsizing: I'm living in a smaller place to save money, but I'm also enjoying cutting down the amount of physical detritus I've built up over time.

There's one exception for my friends and myself, though. We're all splashing out on expanding our hard drives and other digital storage like USB keys and memory for cameras.

It makes sense: some of the space I've saved comes from scanning in old paperwork and ripping compact discs into MP3s.

Which leads to another decision. I don't want Christmas gifts that take up any more physical space.

In these recessionary times, of course, money is fine, thanks. But digital downloads are good too. I'm happy to give or receive digital movies, music and books now they don't take up any more of my precious room.

I'm not sure I want to overgeneralise this into some great universal trend (even though, as a columnist, that's surely my job description).

Nonetheless, I do feel that we are leaving an age when we could spend as much as we wanted on all kinds of amazing mass-produced curiosities, when we stocked our lives with giant TVs and ice cream making machines, and mowers and juicers.

China powers up, and American consumer values power down, and the working and middle classes are not going to be able to afford such conspicuous consumption any longer.

But what does that have do to with the inconspicuous consumption of bits and bytes? Hard drive prices, driven not by demand but by technological innovation, seem set to tumble while capacity continues to shoot up. And we really don't need much more than that to take advantage of the next five years' digital content.

When you look at hardware, we're at a sweet spot for consumers in both the console and PC world.

There's really nothing on the horizon that compellingly requires more speed or power for us for the next few years, no new generations of hardware that simply must be bought to keep ahead.

The X-Box 360 and Playstation 3 are here for a few years, and already dropping in price.

Many of us are moving from desktop PCs to laptops or even the smaller "netbooks", and are showing a willingness to lose power and speed for convenience and price.

This all fits with what seems to be standard recession practice in the technology-entertainment sector.

The hardware development slows down a notch, but the entertainment economy stays as historically recession-proof as it always has.

But this time will be different. This will be the first recession where purchasing will have so firmly shifted to entirely digital products.

My friends and I and our disorganised, download-loving lifestyles may not represent a wider trend: but what if we do?

Cutting back on physical purchases would have economists who want us to spend our way out of this recession turning pale (and it's even worse if we're just giving those goods away to other people. Even less general consumption!).

Shifting that consumption to digital consumption is even more of a random factor. If I'm looking to save money in entertainment, I can already download more legal free material than I'd have time to ever read or watch.

I can spend days on the internet keeping myself amused. And that's not even taking into account those who might download infringing content for free.

When it comes to digital content versus the physical world, the last criterion anyone really judged the competition on was price.

We like our physical artefacts, our thick books, our shiny DVD posters, our sense of ownership. A folder on a screen with a set of files in it just doesn't have the same appeal.

And until now, we've been willing to pay a little extra for the physicality of those entertainment and information products.

But in a recession like this, pricing will be paramount; and it looks like physicality might be more of a burden than a benefit.

Kids don't like inky newspapers around; economising families don't want the upkeep of a satellite TV box or that second car; there are even people who currently have possessions kept unseen in semi-permanent storage that they'll be happy to get rid of.

Physical items cost compared with the cheap and cheerful YouTube video, or Skyping with distant relatives, or flicking through the news online.

The digital world has looked like a threat to physical media for a long time. Now it's going to be an actively cheaper replacement.

The car industry in the US is asking for a bailout because car sales have plummeted. Other consumer items look set for a similar collapse.

What if part of that collapse isn't just because we're worried about our income? What if part of that collapse is that, in a digital world, we just need these items less?