From my basic understanding, is it fair to say that blue ray is a better storage format and that is why it is superior?
I would think that blue ray or HD-DVD will have comparable picture and sound quality until you get to the point that HD-DVD gets limited on space and starts compressing. On the other hand, just because blue ray has more storage capacity, it doesn't even mean they will use it properly. I could see them compress stuff just to speed up production rather than making the absolute best quality.
Also, aren't the new compression formats much better? So you can compress data and then uncompress it with little to now loss in quality? If so, then I don't think it will matter if HD-DVD is compressing more.
To me, the war really boils down to who has the most movies on the market. This could come from more initial backing from studios, being the first on the market, or having lower priced discs. The common consumer is not going to read the high tech specs and opt to not buy one because the other looks good on paper. I would bet that when they both hit the market, you will not see a quality difference between the two. Any quality difference will likely come from the studio who transfers the film. Just like DVD, there is a HUGE range of quality out there. I am amazed when I rent movies, how different discs can be for picture quality. I'm sure we will see the same thing on HD discs. The difference we see on DVDs today is not because of storage limitation. It is because the studio opts to not spend the money to make a good transfer while other do.
Back on the subject of availability: It is like the saying "he with the most toys wins". I think this could be somewhat applied to this war. "He with the most movies wins". If you go to the store and see a bunch of format A and a few of format B. People will by A. If format A is much less expesive than B, people will buy A. If we do see a 50/50 split in titles early on and one is cheaper then the cheaper will likely win out unless the quality is substantially greater (which I don't think we will see).
If we see a 50/50 split in titles and the prices are similar then we are all SCREWED!!!!!!!!!!
I personally will jump on either one when it is pretty apparent that one will eventually win. If it is unclear, I will sit on the sidelines and wait it out.