On Tuesday, Toshiba, HD DVD's main backer, dropped the format. And on Wednesday, Amazon announced it will feature Blu-ray, although it is not yet discontinuing HD-DVD products. It joined Wal-Mart, Best Buy and others in favoring Blu-ray. Universal Studios, one of the few major Hollywood producers backing HD DVD, also switched to Blu-ray.

No Champagne Yet

Sony "better not be drinking any champagne yet," warned Yankee Group analyst Mike Goodman. He said they now face a possibly more formidable competitor -- online or over-the-air digital distribution.

In fact, his research firm projects that in five years video on demand will account for 30 to 50 percent of movie rentals and sales via cable, satellite, telco or the Internet. "The majority of that marketplace will be high-definition fare," he said.

Source: http://news.yahoo.com/s/nf/20080220/bs_nf/58454;_ylt=AiUIoAZm0ylnurL0skMhj34jtBAF

Sure, but even if that happens...PS3? People will always want hard copies of their disc. If they don't, Sony has a device that hooks up to the internet, has a HDD and has a store.

Blu-Ray will have huge sales this winter, and people will still buy Blu-Ray on a whim at retail stores. Owning is better than renting.

I have well over 500 DVDs in my collection and invested in both Blu-Ray and HD DVD (Probably about 20 of each).

It will be interesting to watch what happens. I have tried a few downloads of movies and have found the experience to be excellent. So, much so that I am rethinking the need to purchase any formats and continue taking space in my house with media. I was going to go gung-ho on HD formats with a plan to replace all my DVDs within 5 years until I tried the downloads.

I agree with what you said, however, the general consenses is the exact opposite. That is why Netflix has made so much money.

This coming Christmas should be a major test for Blu-Ray. They will have no competition from HD-DVD, and the prices of players should come down to a more reasonable level.

As far as the download services go, I can rent recent release DVDs for about $1 each from Netflix/Redbox. This is for physical media. I would maybe pay $2 for a instant online rental, but that is about my limit. The Apple TV/Pay-per view rentals are about twice that cost.

People who buy will want physical media. I do not see that changing for a while.

Drink champagne now. Worry about it in 5 years.

 Owning is only better than renting if you are going to watch the movie ~4 times. I almost never buy movies because I typically only watch them once. If I really liked a movie, I can still rent it 3 more times before I should have bought it.

 But better yet. I have netflix and pay ~$1 per movie I watch. Now I can rent a movie ~20 times before I buy it.

My wife on the otherhand loves to watch movies over and over again, so those movies she really likes I tend to buy for her.

How about DVDs, and upscaling DVD players? I'd imagine many, MANY more people use those than online VOD.

Either way, Blu-Ray is in troubled waters.

That's exactly with iTunes never had any success. Everyone wants their CDs (and SA-CDs).

I have netflix as well. Since doing that I have bought maybe 1 dvd. Used to buy 1 every week or two. They upped their video on demand now to unlimited. Which means I actually have not sent back dvds for awhile I just keep doing the ondemand thing.