it went from 1 to 5 =P

I assume you think this means good things for the PS3 but ...

Taking advantage of a highly popular product, to drive sales of your brand new and highly anticipated product is quite a bit different from taking advantage of a moderately popular product to drive sales of your old and struggling product.

500%?........that means its 1% closer to replacing DVDs...lol.
lets face it, DVDs will never be replaced with Bluray.
too many people are downloading movies these days. when DVDs came out in 1998, nobody was downloading films.
but in 2008, the credit crunch means people are cutting back on entertainment.
movies, music, its all downloadable now. and we all know it.

I don't download movies aside from Porn on limewire. Mostly you can blame movie downloads not being as popular as MP3 downloads on the atrocious trasfer times from itunes to ipod.

There will be a need for disc based delivery systems for decades to come. For the next decade Blu-ray will be that delivery system. As more manufacturers market and produce Blu-ray players the cost of the PS3 will drop substantially. At launch it was estimated the Blu-ray drive cost roughly $350 now you can buy an internal drive for $150. Sony will make money on Blu-ray and they are in a position to capitalize on movie downloads as well.

Actually, if you took the time to actually read the article or this thread, you'd notice that it actually gained 8% on the overall movie sales when compared to DVD. Even if the entertainment sales were dropping (and they really aren't, especially movies), then it would hurt DVD sales just as much as Blu-ray. That does not stop Blu-ray from gaining ground. Videogame sales as also up, btw. Finally, downloading hurts DVD sales more than Blu-ray, because the quality isn't the same as Blu-ray.

You do realize not everyone in the world (or even in western countries) live in a highly populated area that gets super fast reliable internet for reasonable prices right?  In fact only a very small percentage are able to, and because of that downloading isn't nearly as popular or accessable and some on this site seem to think.

i wonder if this will help ps3 in the long run

Even in the US many places only have access to dial-up, and the places that have access to broadband are usually charged exorbitant prices.

Japan gets over 10x our average internet speed and they pay less on average!

It'll be years before broadband penetration is high enough for digital distribution to take over.  Even if the speeds were available, they'd have to be at low enough prices for people to consider adoption.  And even at current broadband speeds 720p films take hours to downloa, let alone 1080p films.

So Heres my choice. Buy a Disc based Medium movie ( blu-ray) that I can pop in to my PS3 and watch straight away. OR. download Gigs of information on my 2MB broadband Speed. Even tho blu -ray is more expensive Id rather take it as Its nice to have a collection of Physical entertainment rather than virtual which could be accidently erased from your Hard Drive. When 100MB download speed is common place Movie downloads will start to really take off. Until that time I and most people will stick to a disc based Medium.