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HappySqurriel on 01 November 2009
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Soundwave said:

Nintendo signed a deal with Panasonic to use DVDs in Project: Dolphin. They modified the format to be a propietary mini-DVD format later on. Panasonic gained rights to make a DVD player version of the GameCube.

But the GameCube discs are still basically DVD (albiet mini-DVD). Pirates have burned GameCube games on DVD discs that run just fine on a hacked GameCube. The system can read DVD discs because really it is a DVD drive, they just tacked a few modifications onto it. If it was a truly, completely propietary format, this would not be possible (ditto for the Wii "disc drive"). 

Nintendo could do something similar with Blu-Ray ... yes saving $10/unit in licensing fees is great. But that doesn't stop Nintendo from offering a $30 dongle for to "unlock" the movie playback (they come out $20 on top that way). This was the original plan with the Wii, but I guess by 2006 it became pointless with DVD. That way they actually stand to likely make a profit off anyone who wants to play movies on the system. 

For the flash memory idea ... why not just reserve a 4GB high speed pool of flash RAM onto the system itself for game data? That probably makes more sense than making every game use flash. 

You're not very well informed ...

The Gamecube disc was Panasonic's proposed DVD format that was not accepted by the DVD consortium, and it had a fundimental difference from DVD that made it very well suited for videogames; it was a Constant Angular Velocity (CAV) disc which meant that seek times and latency were dramatically reduced, and developers could get tiny load-times without putting too much effort into it.

There wasn't a massive difference between the Gamecube drive and a DVD drive because Panasonic produced a modified DVD drive that read their proprietary format. The thing everyone who owned a modded Gamecube will tell you is that burned Gamecube games had loading times that were 3 to 5 times as long as the original game, and games that loaded on the fly (which there were quite a few of) were practically unplayable.

 

Now, what Nintendo may or may not do isn't really important, and many people will simply point out that over 3 generations of handheld systems and 5 generations of home consoles Nintendo has never seen value in converting their game system into being a media hub. Today they could create a DVD channel and sell it for $10 to cover the cost of licencing fees associated with it, and they don't because they don't see value in it. Whether that changes in the future is up to Nintendo, but they would have to see value in adding Blu-Ray ... And (for Nintendo) the piracy protection benefit of "spitting out" any format that doesn't look like their proprietary game format may outweigh any benefits from playing movies.