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@Sorrow: That's one thing that I feel the HD DVD camp keeps forgetting. Not many ps3 owners buy Blu-Ray because not many ps3 owners have HDTVs. As HDTV adoption rises, so will the percentage of ps3 owners that buy BRD.

Toshiba's going to have to sell a lot of players this holiday to counter the influx of new ps3s, the rising number of ps3s being used as Blu-Ray players, and the increase of sales of Blu-Ray standalone players with the price drops coming soon. They're going to drop to $400, possibly lower. It may have nothing on $198, but they will sell better than they were before.

If HD DVD doesn't catch up to Blu-Ray in software sales, I'm not sure what chances they'll have of getting Warner to go exclusive.

Also, I'm not sure Warner will even want to go exclusive HD DVD, even if they do level the playing field. With the current studio set-up, an HD exclusive Warner will only prolong this war, causing both formats to fail and the entire HDM market to stay niche forever.

If Warner went HD-exclusive, it would be 4 studios vs 3.  Disney, Fox, Sony, and Lionsgate vs Universal, Paramount, and Warner.  Prices on Blu-Ray players would drop, and it would be an inevitable stalemate. However, if Warner went Blu-exclusive, the war would be over.  It would be 5 studios vs 2.  Disney, Fox, Sony, Lionsgate, and Warner vs just Universal and Paramount.