I realize I'm probably a little late making some comments, but here's my 2c
As for Ed talking about taking the current champ, standard DVD, I'm reminded of an article in either
New York Times or Washington Post the other day where someone was saying if High Definition DVD is a 10, then standard DVD
is a 4 and upconverted standard DVD is a 6.
The difference is drastic enough on a quality HD TV set that we won't have a choice, just like most of us didn't have
a real choice but to use Windows XP soon after it came out.
IMO, that's really overstating the situation. The picture quality from Blu-ray is better, but it's not that much better. A videophile sees the difference as that drastic and feels they "must" have it. But certainly it's not such a major upgrade to Joe six-packs everywhere, and J6P defines the market. We need look no further than Laserdisc as an example. Surely LD looked far better than VHS, everyone could tell that. But only a small percentage of the market, approx. 2%, felt that it was worth the additional monetary investment to buy LD. For the masses, VHS was sufficient. Blu-ray is facing eerily similar circumstances.
Furthermore, standard definition DVD's are not unwatchable on an HDTV, they look rather good in fact. Better than they do on regular 480i standard TV's. Starting with a quality anamorphic transfer and utilizing a good upconverter, the results can be absolutely stunning. On this claim I'm going to have to say the Emperor has no clothes. DVD is natively digital, it's not like connecting an old analog source. If we were talking about LD then sure, I'd say people with an HDTV really have no choice but to upgrade. Alas, this isn't the case.
So there simply isn't some massive built-in incentive to buy into Blu-ray. There's no mandatory or compulsory reason to abandon DVD for the sake of HD. With Windows, Microsoft basically has the power to impose their will on the world. Sony is not in that position. Trying to claim there is such a driving force is misguided.
More food for thought - the reality is that not many homes have even a single HDTV, and the majority of those that do have one only have just the one. Right there that tells you DVD will remain king of the mountain for the foreseeable future. 10+ years after release, HDTV's are still a minority product when it comes to TV sets in use. Consumers are only adopting them slowly. Furthermore, a large reason HDTV's are selling so well now is because of the form factor - not so much the improved picture. I've had a plasma for many years now, and when I first got it more people gave me compliments when it was turned off than they did when it was on! What struck them was how it freed up my family room. Look at how few rear projection models are manufactured now. Soon I believe the only rear projection models left will be DLP based, and IMO those won't last long either. People love flat, and that's the main reason they'd want to upgrade their TV. Picture quality just isn't that big a deal.
Here's my final talking point - price. My supposition is that the primary reason LD never gained market share was because people couldn't afford it. The players were several hundred dollars and the movies weren't cheap. DVD is cheap, Blu-ray is not and Blu-ray is not going to be cheap any time soon. In fact, I just read two articles recently on AVSforum that talked about Blu-ray's high prices. As long as Sony and company maintain a high premium on Blu-ray, it will never be adopted by the masses. People are spoiled by $5 DVD's and $10 new releases. They are not going to pay $20 for old catalog movies and $35 for new releases. And they certainly won't pay $400 for a Blu-ray player when they can get an upconverting DVD player for less than $75.
So let's look at this point by point:
1. The market for HDM (High Def Media, which = HD-DVD and Blu-ray) is inherently small. It's primarily made up of videophiles and people with a relatively large amount of disposable income. Non-HDTV owners, which comprise the majority of the home video market, have literally no use for Blu-ray.
2. DVD is everywhere. In cars, in portable players, cheap hardware allows it in every room with a TV. Trying to overcome that level of saturation is nigh impossible (just ask SACD or DVD-Audio how things went in their fight vs CD and MP3).
3. DVD is cheap and plentiful
4. DVD is versatile. People can inexpensively burn their own, or discs can be ripped and stored on HTPC's or portable video players.
5. Blu-ray isn't the only HD game in town. PPV / on-demand HD (so-called HD lite) is one alternative. Download services are another. Solid state is an option with promise. The window of opportunity isn't looking so good.
Blu-ray has a major uphill battle, and it's one I don't think the format can or will win. I bought into HD-DVD because the price came down to a level where it could have started gaining real market share (let's face it, $100 players sell). As it turns out, Sony saw the threat and bought Warner Brothers support thus ending the HD format war. Now Sony is holding the line on price and hoping / praying that the PS3 carries the format to total victory. Sorry, I don't see it happening. Blu-ray has niche product written all over it. IMO, it will at best have the lifespan of LD, holding out as the format of choice for videophiles until something better comes along. At worst, Blu-ray could be the next SACD. For those that don't know, SACD was a high-def audio format that beat out DVD-Audio but in the end it didn't matter, and it's now a dead format itself... shunned by all but the most fervent of audiophiles.