This is just a guess, of course, but I expect the marginal cost of providing you an online version of TurboTax - a few minutes of very cheap server time - is way less than the marginal cost of cranking out another CD, packaging it, shipping boxes of programs to retailers and so forth.
Plus, and here's the hidden kicker, with the purchase of one CD you can produce income tax returns for everybody in your extended family. Alternatively, TurboTax can sell an online version to every member of your extended family. No wonder the online version is pushed so hard!
