Sony's Blu-Ray Misses Its Moment

This should be Blu-ray's big moment in the sun.

Sony's (SNE Quote)next-generation, high-density, optical/video disc technology finally won the battle over the Toshiba and Microsoft (MSFT Quote)-touted HD-DVD format.

But what exactly did they win?

Yes, Blu-ray is the high-definition disc of choice for the movie industry. New movie releases tout that they're now available on both DVD and Blu-ray, but so what? For most consumers DVD, is a lot less expensive -- player and discs are dirt cheap compared to Blu-ray machines (although those prices are falling).

And the next step might not be about getting consumers to switch from one disc format to another. It could be that future movie consumers will prefer downloading movies directly to their home.

For now, everyone is hedging their bets on the next direction for the home movie-viewing industry. Blu-ray machine manufacturers are reaping lower production costs and have begun slashing the prices of some of their current playback decks from companies like Sharp, Sony, Samsung, and Panasonic (PC Quote). What used to cost $300 or more at the beginning of 2008 now hovers around $200.

If you search really hard on the Internet you might even find Blu-ray "hardware" selling for $170 or less. Prices for Blu-ray "software" -- the actual discs -- are falling, too. Next-generation Blu-ray machines, which should be announced soon, will have new features but will cost more.

It will take a long time to convince millions of old-fashioned DVD users that their machines are technologically outdated. Double that skepticism while the country is battling this economic downturn. DVD discs are inexpensive, and DVD playback decks are very, very cheap. Rentals are not only cheap but they're abundant.