Some things to point out:
-I think Toshiba's plan all along (since they were making so much money on the regular DVD format) was not to "win" the HD format race, but rather delay it.
-Taken the point above Toshiba may further complicate things by not letting go of Paramount (although this is more of a contracted time exclussivity deal) or Universal...which means that the competing side (Blu-Ray) will either be forced to some kind of reckoning terms (bigger cut and/or midground specs) or have incomplete libraries...this isn't "over" yet.
-One of the reasons Universal (and to a lesser extent Paramount & WB) chose their sides earlier on is because they've been trying to jolt the movie industry...it's obvious these 3 titans do not like rental and to some extent don't like physical retail (because they get burned (pun intended) on piracy & previously viewed sales they don't see a lick from) this is why you'll see a lot of their media on other formats (online/subscription services/set tops) day 1 right next to the physical store shelf discs.
-You guys keep saying how "sly" WB is about this when they said (before XMAS mind you) that they weren't choosing sides...hell, what do you expect them to say: "don't buy all these 10's of thousands of HD-DVD discs we made this X-MAS 'cos we're chosing BR right after."
-Speaking of which, if you weren't paying attention, WB was running tons of great sales on their HD-DVD discs (Harry Potter & Batman collections) this XMAS...can you say clearance?
-If you wanna talk "sly" when it comes to WB, it should be noted that they were amoung the first to release DVD's and they did so before the spec was truly finalized which lead to several things: the format being easily cracked, WB getting a "headstart", thusly them making enemies.
-Taken the point above, it's probably why WB decided to announce this now, before CES so as to not piss off MS & Toshiba as much as if they were to have dicked them at or after CES Nintendo style.
-As far as easy pirating, WB knows all too well ('cos it was mainly their fault jumping the gun with DVD before it was ready) the dangers of this issue and it seems HD-DVD was RECENTLY OPENLY HACKED...so that may have had some effect on this announcement too.
-Paramount (Viacom/Nick/MTV/DreamWorks) recently did align with HD-DVD for mainly an I believe, valid spec-point (online access to progressive special features (I hate buying a movie and then the same movie *with better features* comes out 2 months later...that's BULLSHIT) so that as new features become available, registered buyers have access to them without having to buy a new "edition" of the same movie)...however, when the announcement was made there was A LOT of pissing/moaning by directors who wanted their movies to be on the opposing or both formats: Michael Bay & Steven Speilberg being amoung them!
-Sony has A LOT riding on these events and this means A LOT for PS3...Sony has a dangerous strategy and this may be part of the turning point for them...Sony aquired MGM for this reason, they almost bought Blockbuster (rumor a couple years back, I work for BB) through Columbia House in order to try to force Blu-Ray, but instead opted to keep a very good/open relationship with Blockbuster (who, BTW, is about the only rentail chain that isn't dying in a dying business) and people WILL bite on PS3 once the price is right mainly BECAUSE OF Blu-Ray...Sony & Blockbuster (as well as all the other BR partners) are pushing this format down everyone's throats and this can effect gaming so it is relavent to not only movies, but gamers as well!
-To add, this could've REALLY F'D up Billy Gates CES/X360 plans...this is legit for gaming news!
All that said (sorry I had a lot of points to make) I love DVD and (while I have an HDTV) I think the way the movie studios and CE companies went about HiDef formats was ALL WRONG. It shouldn't be a "format", it should be online digital distribution (like iPod/iTV and the like) and this can prevent a lot of the problems with people today...pirates are always gonna find ways to get what they want, but how 'bout lowering prices (via downloads instead of discs) and offereing ALL special features in reward to all those people who legitimatly buy and register your movies? To top it off, not only would you have those special features but you can opt to buy the movies soundtrack and/or a portable resolution version of the movie thus giving the consumer more value? I guess that just makes too much sense.
Also, gaming related...this really brings the focus off Nintendo vs them and brings it back to MS vs Sony...Nintendo further seperates itself and creates it's own market seperate and apart from them. We know this, but this will drive the point to everyone else outside of gaming as well and when it comes to Sony vs MS, I think Sony will ultimatly end up "winning" between the two.