I agree and I disagree.
I think that Blu-Ray could very easily get cornered into nothing more than a niche market similar to SACD or Laser Disc, while download services and other distribution methods become the "next" generation format for movies.
I've said it hundreds of times before... new formats are ALWAYS driven by conveniences NOT quality. If you take quality out of the picture what incentive do people have to go with Blu-Ray over DVD? There really isn't any incentive, actually there's much more incentive to stay with DVD at that point.
Now compare DVD to digital disto by way of downloads or memory sticks in the stores, again quality aside, there are quite a number of incentives to go digital distro for most consumers.
Similarly, compare CD to SACD, and compare CD to digital disto like iTunes, and other music stores... Convenience is king...
I disagree because I think it's NOT too late for Blu-Ray. I think the quality differences is staggering enough, and digital distro is young enough that Blu-Ray could sweep the market but to do that they need fully featured players for less than $250 and media priced at $15-$20
Judging by the speed of evolution for the digital distro services I think they have about a year and a half to do that until their cooked beyond return. since digital distro is more a software and infrastructure based platform it's a whole lot more nimble than a physical format like Blu-Ray...
It's clear that the Blu-Ray backers breathed a sigh of relief when HD-DVD threw in the towel, prices have actually gone UP considerably for both players and media...
People seem to forget that one of the biggest selling points of HD-DVD was that the manufacturing processes were much much cheaper than Blu-Ray meaning that prices would go lower faster, and that meant faster adoption once the "war" was over...
Not everything is about who has the best specs... in-fact, it's rarely about that when the mass market is involved.