Why are Digital TV Shows/Movies more expensive than Physical copies?

I love that I no longer have to buy CD's but why is it that in order to get the best price on a TV Show/Movie then I need to buy a DVD because Digital prices are always higher than physical?

With TV Shows it's pretty common to find a season on DVD ( 24 episodes) for about $10-15 but if you buy the shows digitally its $2/ep, $35/season or $50 for HD. Many times I find myself buying a DVD box set, wasting hours encoding/tagging it and then putting the physical copy in the garage ( I can't sell it because legally we're supposed to own the physical media).

With movies then if you buy the first week then they're on sale for $10-12 while the digital copy is released at $15-20. It's a bit better with movies because the physical DVD sometimes comes with a digital copy but once again its just far too much work and storage space for something that should've been a simple one-click purchase.

So whats the deal with digital pricing? Is it due to iTunes restrictions? Studios not understanding technology? I'm just looking for a way out of buying physical media.