And you are correct to point out the cd vs. downloading market. Yes cd's still sell millions, but the argument should be that it is actually dvds that will continue to sell millions during the period of the physical distribution's decline. The decline is already beginning. Look at the video rental stores closing left and right, the vast bargin dvd bins in most stores. I think the dvd industry is just grasping at straws in hopes of avoiding what the music industry is going through now. I am sure 10-15 years ago, very few, myself included would believe the state the music industry is in right now. I thought when I first starting hearing about music downloading that it would be a fad and who would want to give up the liner notes and album art. The movie industry doesn't even have that going for them - it is just a matter of time.
The HD formats are never going to be as popular as DVD, no. But that doesn't mean there's "no future" for them. A significant number of high-end consumers are going to want hi-def movies, and when prices drop to the level of DVDs over the next few years and HDTV penetration becomes total, many casual consumers will make the move too. 25% of the home video market is realistic, I would guess, and they may well do better than that in the end. That would be a huge success, and everyone involved would profit. Remember, laserdisk was considered a successful (if niche) product, and the HD formats are already more mainstream than that ever was in terms of things like retailer shelf space. They have nowhere to go but up.
And DVDs aren't in "decline." Not even close. Yes, DVD sales in the US in 2007 dropped a whole 4.5 percent after plateauing for the last few years, but that's easily explained between the drop in the US economy and the shifting of sales to the HD formats. DVDs being available in every store and in bargain bins for cheap is a sign of their success, not their decline.
As for downloadable solutions, they're coming, but not as fast as you imagine. I expect downloadable movie rentals will become the norm before long, but for actual purchases, most people aren't ready to give up their physical format. We like to have a piece of plastic to hold and read and put on the shelf. That won't change in the foreseeable future -- at least a decade, probably two. BluRay will have run its course by then.
Now, about WB's payoff, I seriously doubt it. 500 million is a ludicrous amount of money, which the bribers would have little hope of ever recovering. And why bother, when BluRay already seemed to be on course to win this war?
Actually, that's half a thousand dollars. That's an amount I'm more inclined to believe, come to think of it. But this mistake, and the generally childish, tabloid-esque writing style of the post confirms that I shouldn't put a lot of faith in this source.
This wouldn't be an illegal transaction if it happened. WB aren't criminals, they're a publicly traded corporation, meaning that hiding a deal like this would be illegal. 500 million dollars doesn't just show up in a major corporation's bank account without anybody asking questions.
