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My two cents for this discussion.

1) I think the inclusion of Blue-Ray was important for the success of the PS3. Remember that back in 2007 there were basically no sources for HD content except Blue-Ray and HD-DVD disks. Dedicated HD players were almost the same price as a PS3. The price tag of the PS3 was huge (600€ in Europe, which was roughly $800 at the time), and without the Blue-Ray player it would probably fall to 450€ or something; but the idea that you could get an HD player for so little extra cash was attractive.

2) I ignore whether Blue-Ray is dead. My instinct tells me that many people prefer having hard copies of their movies rather than an elusive right of streaming something. If you have your own hard copy of a movie, you will be able to see it (or lend it) whenever you want, whether your digital content streamers want it or not. Personally, I rent Blue-Ray disks online, which are then sent to me by mail. I have access to digital movie streamers but I think they have worse content and are more expensive; also, the online video club's interface and features are so much better.

3) The same as in 2) goes for games. I always prefer having a hard copy of the game instead just a download. (With the PS Vita this is truly vital because games rapidly eat up all disk space.)

As a conclusion, the Blue-Ray player of the PS3 was undoubtedly a decisive selling point for me. I, my wife and especially our kids have watched hundreds of movies in our PS3 since its launch.