Take a look at the Wii, do you think that most of the people care about HD? No way! DVd quality is Ok for most of the people.

Ps. I do care about HD and digital download is fine for me.

I don't think Amazon and Netflix would be investing huge amounts of money into digital distribution if they didn't see a future in it. If they thought that Blu-ray would be the only dominant media of the future, then there would be no reason to invest in digital distribution.

my final point is cost for HDTV's and players is not a real issue as several other posters have pointed out as an issue related to blu-ray.  I'm not selling anything to anyone, it is an example.  If you can't read into what I am saying, it is both formats are needed at this point, and for a very long time.  Global digital distribution is years away from being feasible as a stand alone source of HD material.  The only country with a large enough broadband network to support this is Japan.

I will revisit a few of my points:

Broadband availability:  I live in the DC metro area and there are TONS of large deadzones where a cabled broadband network is unavailable.  As for satellite, I am not referring to the latency issue.  I am rferring to the fact that it is largely plagued with issues.  I have a house with satellite becasue it's in the middle of nowhere, as do several of my friends and family members and all of us have issues with losing it all together.  The fact is, globally, broadband availability is not widespread enough to support digital distribution for HD content as a whole and a disc format(being blu-ray) is needed to fill in those gaps.  Add in the fact that the size of HD material and compare available broadband speeds and there is an issue with download times.

Corrupt data:  How many times have you downloaded anything and somewhere in the download the data was corrupt?  How many times have you downloaded a movie/tv show/ video and there were visual-to-audio sync issues?  I understand this issue is often refunded for purchased products, but it is an issue.  Disk rot, yeah it sucks.  Scratching a blu-ray, it is incredibly hard to do(but when you do there is no way to fix it).  Major flaws in both sources here.

Hard copy:  Yes most people should back up everything they have(and want to keep) multiple times.  You do it in an ideal manner but as you said they don't do it.  blu-ray is convienent and a large number of consumers enjoy having a physical hard copy.  If they didn't, cd and dvd sales would be non-existant.  Theft is not an issue that applies to the debate of blu-ray vs. digital distribution.  Security issues are up to the individual buyer.

Costs:  Ok I wont use evidence or pricing from anywhere since apparently I'm just pushing products to makes sales that mean nothing to me.  Fact is, price of HD products are coming down.  Most people will upgrade to HDTV's in the coming years as they are becoming increasingly affordable.  BRD players have dropped in price and are prices closely to DVD players with upconversion (referring to the ones that will upconvert closest to full HD).  The last price problem is the disc itself, much of this is related to the scratch resistant polymer.  I would suspect that as time goes by and sales increase these will become cheaper.  I remember paying $30 for a dvd movie when it came out.  Yes it was a more obvious replacement to vhs compared to BRD replacing dvd's and the price dropped fast, but BR's will eventually drop.

Conclusion:  Both BRD and DD can provide HD content to customers.  DD is mainly available to people living in hardwired metro areas.  The other can be used universally to those who can afford it.  DD is probably 20 years away from fully replacing a hard physical copy such as blu-ray.  That being said, blu-ray fills the gap between dvd to DD.  Is there reason for execs everywhere to be concerned about blu-ray? yes, and it is largely caused by the recession as was initially pointed out.  But doesnt this also affect DD just as much?  Aside from recession issues you have the relatively slow adoption of blu-ray.  It is still in it's infancy but with it finally prevailing over HD-DVD there will be less confusion to consumers and it can now move into a holiday season as the HD format of choice.  With appropriate advances in technology and the production of diodes and disks, it should result in lowered prices.  Lower prices with strategic marketing will yield higher gains in the movie market.  Hopefully by then broadband networks will be expanded and improved upon and DD will ultimately take over.  regardless, there will always be a market for hard copy media.

that sucks for Sony. They lose in Beta to VHS and now they finally win a video format battle, an they lose to a recession...

 You're probably not just naughty but also poor. People in New Zeeland are very poor lol. You said it yourself a while ago.

It think the market for HD media is really going to break down into those who want to do a single/limited viewing and those who want to "own" a movie/show/etc.

Time will tell what the percentage breakdown will be. Personally, I like to own my movies on disc and am waiting for Blu-ray players and movies to drop in price.

I don't view On Demand/DVR as comparable to BRD or DD.  I am referencing media which will allow you to have long term posession of the product you wish to view.  On demand/DVR from whatever cable/satellite provider you have, is a rental service.

I am referring to paying to download a copy of a program and storing on a HD or buying a copy of a program on BRD.

i can say, i have only had one corruption in the entire time i have used downloads (outside of font transfers, even from local servers). it was back when i used 36k modem and i was redownloading the original command and conquerer (I had deleted my first one for space reasons) we had a power outage and it killed the whole thing... reconecting did nothing and the thing was 98% downloaded had to start all over god that sucked

back to broadband, it is avalible, at minimume in dsl form, in almost all developed areas that are the larger markets for entertainment, an interesting solution to the issue you bring up of rual issues, has been implemented by best buy and mcdonalds of all people, where they localy host broadband, so you can come in and use the internet there to load what you need, from what ive read more current releases would be kept on a local drive, and you could send ahead for requests so they would be ready when you arive, or come back to the location.

I would say theft is an issue, though only from what i have observed, i know 4 people who have switched to all digital because of past theft of the library of material. I do not dispute that physical media is good I enjoy it myself. I do foresee more and more people backing up, not because they know to, but because companies will offer it as a free service with use to avoid issues with things like fried hard drives it makes sense in a costomer service solution

I do agree with you on costs will come down, but buying downlaods will be cheaper for users and more profitable for content owners. no matter how you cut it, you can not remove shipping/packaging costs of dvd/blueray, and lost salse on units that were over produced, or even worse producing too few to meet demand, and consumers dont come back to buy under a second printing. with digital all of that goes away.   the content owners get even more value from reducing the middle man, in the new world the internet is the middleman, and we the users pay to get on it to do all kinds of crap.

also i dont doubt there will always be a market for hardmedia, i expect jumpdrives, or a solid state to be the next big real thing. but thats a bit off. 

blueray is just not enough to justify itself (outside of a digital storage media that is) the advance in picture is not good enough (in soem cases none at all if they did not remaster the blueray from original film, and not a vhs, or dvd). it is not a smaller form factor, it does not offer much more in the way of features.

blueray could have been better, one of its main issues is the lack of  a final standard which is due to movie industry worried over piracy, a lack of agreement by large computer companies MS& apple over specs, and production uniformity.

for now it is a subformat being pushed on to a public, that has not look at it favorably. yes this could change, or the industry could force on us by killing new dvd releases, but i dont forsee either one happening. 

Yuo say DSL is available almost everywhere?  I just LOL'd so hard that i fell on the floor and ROFL'd.

Regarding the comments about Dish TV and Directv offering 1080p HD service.  Neither satellite provider offers 1080p HD service, nor do they plan to offer it in the future.  Both providers offer 1080p VOD service, sort of.  The DishTV 1080p VOD offering is currently Speed Racer, with a second movie planned in November.  Dish TV pushes a copy of 1080p Speed Racer to the receiver during the night regardless of if the consumer purchased it.  If a user pays $7 to watch Speed Racer, the receiver unlocks the movie.