Or do people just really not care about it?

http://www.dmwmedia.com/news/2008/05/02/npd-report-indicates-blu-ray-players-still-slow-catch

Personally NPD's opinion has always been my opinion, but i'd be interested if people want to offer arguements for the opposite. 

and whats your opinion

Well, there's already ~12 million Blu-Ray players out there, so of course BD players aren't selling great.

i think that people are going to buy the ps3 over a standalone player because its the only one that supports 2.0 or wotever it as and is one of the cheaper blu-ray players at the mo, plus you get a gams console to

That people just don't care. And won't care until everything is close enough in price to DVDS and DVD players.

I don't see many people buying a PS3 as a movie player but are mostly buying it as a games console with any blu-ray playing being a secondary feature at best.

The Ps3 could stay the best PS3 forever and I think a majority of people would refuse to buy it as their blu-ray played just based on the stigma of it being a game console. 

yes, but till the price of standalones are 199 who cares

The home entertainment industry apparently.

"Sales of Blu-ray standalone players plummeted 40 percent from January to February, then rose only 2 percent from February to March in spite of winning the high def format war, according to a report by research firm NPD Group. This is bad news for the home entertainment industry, which has put its hopes into a drastic increase in adoption of the next generation high def DVD players after Toshiba dropped its support for the HD DVD format earlier this year in favor of Sony's (NYSE: SNE) Blu-ray format."

Blu-ray adoption is going much slower then anticipated.

The question is... is it because the PS3 is canabalizing standalone players?   Or is it because the industry set it's hopes high because of how much the PS3 has risen lately when the actual numbers of people using them frequently for blu-ray hasn't jumped equally. 

blu ray players are still TOO expensive.

i have one in my computer ($140) but i will not buy a stand alone player until it is down to under $150

Well the reason as to why I have always decided against buying BD players is because if I can always buy a PS3 instead. However, I don't feel like buying a PS3 right now, just not worth it for the games it has and a slim one might be nice. As a result, I don't have anything Blu ray and I'm perfectly fine with that.

Anyone in the market who does a little research or even gets reasonable guidance on the matter will choose a PS3 over a stand alone blu ray player. (for the time being of course)

I do have my doubts of how great blu-ray will ever become. While I doubt it will fade quickly into irrelevance like the UMD did, I think it will struggle until the vast majority of people have a tv and sound system capable of making them care... and even then, who knows?