I think if they re-examine the market in 6-8 months things may look a little better for blu-ray. Why? Because the HDTV switchover will force a segment of the market to upgrade to digital technology. As that happens, and more HDTVs end up in the market, blu-ray will get a little boost. It’s a more natural sale to push a high-def disc player to someone whose getting a high-def TV. Especially if prices fall during that same period. Of course, it’s likely to be tempered some if the economy keeps heading south.
However, if some other technology, perhaps like flash ram based media cards, drops even more in price and goes up in capacity, the disc as media could be facing a tough battle. How’d it be to buy your movies on a card perhaps the size of a credit card? Small, durable, easy to store, easy to use. Players would be easier to build, with no moving parts to break, so likely cheaper. And upgrades in the future wouldn’t require new laser tech or disc media, just higher density media, which can already be greater in density than the 25/50GB of a blu-ray. SDHC cards, tiny little suckers, have already hit 32GB. How many of those could you fit on a cradit card sized piece of media?
So while I think it’s possible blu-ray can make it, they better stop screwing around, or somebody is going to surpass them.