Ask your parents about Betamax. I believe one format is the only logical solution, and that once the winner is declared you bet your ass the studios will put their product on the new format. I spoke with both Family Video and Blockbuster, and they don't want to distribute both formats either.
Sony Blu-Ray has an advantage in that they have more exclusive movies right now, which is because they own Sony Studios, Columbia Pictures, and they are affiliated with Disney. I'm sure they own more too.
HD-DVD, IMO, HAS A BETTER CHANCE TO WIN BASED ON TWO VERY ELEMENTARY THINGS.
1.) The branding.
The name HD-DVD makes sense to a larger audience, it just sounds right, like the next step in DVD. Put yourself in your grandparents shoes, they are just getting used to the DVD player they got for xmas, what is Blu-Ray?
2.) The price.
If HD-DVD continues to offer players at a price of $99, such as the HD-A2, I believe the sales of players will increase the demand by consumers for more titles on HD-DVD will result in more studios releasing on HD-DVD. Studios care about profit.
Nevermind the small tech specs, such as audio format, decoders, disc storage capacity; they are very similar formats and the tech stuff isn't going to be the deciding factor.
Blu-Ray needs a sub $200 player to compete, even if they are currently wining in disc sales.